Sufficient proof of VAT Paid?

flyingscampi

flyingscampi

Well-Known Member
Joined
15 Oct 2007
Messages
561
Location
Medway
Visit site
I saw a post recently about boats part 1 registered in Guernsey (as mine is) and the issue of VAT status.

I only have a good quality colour photocopy of the original VAT receipt (a pink form C102A) with all the necessary stamps etc.

I am going to write to the previous owners to try and get the original, but assuming this isn't possible, will the evidence I have be sufficient to satisfy an inspector?
 
I would have thought that your boat wasnt vat paid. After all, why keep / register in Gurernsey and leave 17.5% of the purchase cost with the government? Obviously possible to do that but it seems strange.

A copy invoice isnt acceptable because VAT can be reclaimed on export from the UK to Guernsey in which case the original vat invoice would normally have to be handed in. Anyone can keep a copy.

Do you have bills of sale between UK resident owners going back to the opriginal manufacturers one?
 
On a previous thread a poster had obtained advice via the RYA that a copy would in certain circumstances be acceptable. However, I can't find anything on the RYA site that expands on this.

As to whether your boat would be considered VAT paid, you would need to show that it has always been owned by an EU resident and support this with the records of Bills of Sale. It only loses the "status" if it is sold to a non-EU resident. Your Guernsey registration is, I think irrelevant as registration is not linked to VAT. If the boat was originally sold to a Guernsey resident then a VAT invoice would not have been raised.

If you look at the guidance on the site you will see that there is no conclusive proof of VAT status, just a trail of evidence. Having your Bills of Sale and your copy would show, say, the French customs that any VAT issues are with UK Customs. As HMRC does not seem to be in the business of randomly pursuing boat owners - they have much more important things to do - you should not have any problems.

Obviously it would be good to try and get the original invoice, but in having a copy you are better off than probably thousands of boat owners who don't even have that!
 
Not always easy when most builders are now out of business. And there is only a legal requirement to keep records for 6 years anyway.
 
In am in a pretty similar boat (so to speak).
You could try getting in touch with the office that issued the receipt, tho when I tried that the office had closed down and all records had been destroyed; what!
Your blue book would establish the trail of ownership but this really needs to be backed up with bills of sale, sometimes difficult. Do try getting in touch with prior owners, I drew a blank though. I have some proof that my boat was based in the UK on the magic date (around '82ish) but that is a little before your boats time I think. There used to be an office in Dover that was there to give an opinion on these matters - it was so busy they closed it down...

There are lots of reasons why CI registration was and is used, that having nothing to do with fiddling VAT, and I am sure hundreds of yachts have found their way back to the UK, or never left in the first place. Your photcopy and reg doc are better evidence than many folk have, and, as Tranona has suggested, the revenue have more pressing things to do than chase a few bob on VAT issues lost in the mists of time. To put it bluntly I suspect that the EU is more interested in large and newer boaters who are trying to evade bills of £100,000 not MOBoatowners whose boat's total worth might not be a quarter of that.
 
I had a problem with this when selling my boat recently. Customs sent me a certified copy of the stamped import document in the end. It was free but took quite a bit of tenacity on my part to find someone prepared to do it, whats more I had a lot of detail ie an unstamped copy of the form and a copy of my bank statement for the day I paid the VAT (in 2004). It seems there's no easy answer and no official route. Certainly the call centres will have you slamming your head in a door, it's only when you get a name and extention number of someone with a brain and prepared to own the problem will you get anywhere.
 
That is a very different situation from a boat that was just bought from a builder or dealer where there is no record kept of the transaction except by the VAT registered trader - and then for only 6 years. There is also no requirement to put any specific details on the invoice to link it unequivocally to the boat. As an example the identification of my boat on the VAT invoice from the Greek dealer I bought it from is its Greek registry number, which no longer exists as it is de-registered. It does not have the HIN although the Bill of Sale has both.

If you look on the RYA website you will see a confirmation that HMRC ceased issuing any documentation about VAT "status" on individual boats in 1996, because it is almost impossible to be absolutely certain VAT has been "accounted for" if the VAT was collected through a trader.

If I understand you correctly you paid the vAT directly on import to HMRC in which case there would be a record with them. I wonder if they keep records for only 6 years!
 
Yes that's correct, and it was hard enough even then and from what you're saying, if it'a a builder it will be worse. HMRC say that (in my case) the importer should have kept the records. That meant the shipping agent. They hadn't. It's basically a bit of a nightmare, and when I asked if I would have to pay the VAT if I couldn't prove it was paid, they didn't have a means for me to do so. So I can see a circular problem where with no documentation you can't sell your boat......
 
Sorry, I should have posted some more information originally.

It's a 1987 Westerly originally purchased by a Guernsey resident. It changed hands in the Channel Islands before being bought by a UK resident in 1998. He paid the VAT at the Southampton HMRC who issued the receipt (for which I have the copy).

The boat has changed hands twice in the UK (including myself as the fifth owner) and judging from the receipts, has always berthed on the mainland.

I have the blue books going back to the original owner and the bills of sale going back to the second owner in the Channel Islands.

I was going to transfer the registration port to a mainland one but they were so helpful and efficient at Guernsey that I didn’t bother (there is also the cost).

Considering the time gap, I doubt that customs would be any help, so I’ll try the previous owners first.

If I decide to take the boat abroad, can someone confirm that it would be a good idea to take the bills of sale and blue books with me?
 
Assuming you are UK resident, then the bill of sale showing that you bought the boat from a private person who was UK resident is always sufficient proof that you have no VAT to pay in the EU.

It still could be that the previous owner imported the boat without paying VAT (or claimed it back), but that is his problem not yours.

There is not such thing as a VAT paid status (there are many ways where VAT can get paid and be claimed back or the boat to be exported and reimported and VAT due again etc etc).

There is only (limited) proof that you do not owe VAT.
 
I have not been around for a while so things may have changed, but I know that this question crops up all the time on these pages. Have we any evidence of the lack of VAT paid status resulting in HMCustoms asking for payment from a UK resident for a boat that was already imported into the UK? Last time I asked this question, a year or two back, nobody could come up with anybody. It is a wonderfully mad position, due to lack of clarity, which I suspect is deliberate from HMC, and a great bar room topic for pontification. We must have a few customs lads and lassies on here???

We have cruised fairly extensively in recent years and while we have been asked for all sorts of paperwork around insurance, registration, passports, liferaft certificates, and sailing qualifications nobody, foreign or British official, has ever asked us about our VAT status.
 
I think you are correct. Received information is that only owners of new-looking, expensive-looking boats are ever asked for such information. If the boat in question has had five owners I assume it is not very new? The only rider to this is the Guernsey registration, which might set someone's alarm bells ringing.

The RYA conducted a survey of members last year, asking for experience of being asked to demonstrate VAT paid status. This seems to have been a non-event, with very few replies. It seems that this is not a problem for the vast majority.
 
This subject has had a very healthy discussion here

http://www.ybw.com/forums/showflat.php/Cat/0/Number/2070828/page/0/fpart/16/vc/1

I took the matter up with HMRC at the boat show as did another, more informed forumite. A copy of my post on the subject is below.

I am currently trying to buy a 1989 boat wich is being sold by executors, and I have no doubts that the previous owner (in my opinion) was a private individual. Unfortunatly in dealing with the estate it appears that the original 1989 invoice cannot be found (assuming it was available in the first place)

I am keen to complete the purchase of this boat witout any ongoing potential liability (of any sort, cost, inconvenience, worry, etc etc etc) so I took the opportunity to ask for some advice from HMRC representatives at the London boat show last week, as to the best way to proceed. To quote them word for word, their advise was "dont touch it with a barge pole!"

Clearly I did not find this to be particulrly constructive advice, but even after pressing them further, this was without doubt their position.

I tried to discuss with them how best to overcome this issue, bearing in mind that the original VAT invoice from 1989 was not available.

They said that they would not re issue the recipt (even if they had a record that VAT had been paid) as a result of previous litigation they had been involved in. The only way I could obtain a new receipt would be to pay it again and thereafter look after the receipt.

In my case the ball is in the court of my seller. However, as a potential buyer, despite all of the very intersting information provided by the posters in this thread I am obliged to listen to the advise given to me by HMRC and ensure that the potential liability is addressed by the seller now, at the time of the charegeable event. If not I am inclined to walk away from the deal. Short of the seller producing the original VAT receipt, or reduciing the price by the VAT liability as explained to me by HMRC that is what I will do. They will have to continue to advertise the boat untill someone else appears on the scene who is prepared to accept the onging liability which only seems to exist in the eyes or HMRC.

Perhaps the RYA would want to take up this transaction as a test case and draw HMRC into resolving this dreadfull situation once and for all.....
 
Thanks slipknot, that's a really interesting thread - I don't visit that forum too often. I hope jfm is right as I have little to worry about being the third UK resident to own the boat.

If the HMRC are peddling a load of nonsense, how come the RYA hasn't challenged them about it before?

After 10 years of dealing with the CSA I can understand how the HMRC reps at the show wouldn't have a clue about their own legislation.
 
When your 'ship' is on the Part 1 register you get a blue book which is like the registration document for a car.

Apparently you only get the blue book now if you register at the port of Guernsey.
 
You must log in or register to reply here.

Share this page

Top