VAT: Buying In Europe Now and Collecting The Boat After 'B Day'.

[langstonelayabout]

OK, I’m about to look at a boat. It looks good in the pictures and the description and price nearly match up. Thing is, I’m in the Solent (UK) and the boat is in Republic of Ireland (Eire).

The fun thing is something called Brexit, currently scheduled for the end of this month.

If I were to buy it later this month but still leave it in Ireland and collect it in spring 2020 would I be liable to pay UK VAT on it, even though it became a UK owned boat when I bought it? Your thoughts please?

 

[lw395]

Sounds like a grey area to me.

Your location might complicate things further?
Are you ex-pat for tax purposes?
Are you going to be Uk resident when you take delivery of the boat?

Frankly you'd be bonkers to put too much store in amateur interweb opinions trying to apply logic where there often is none.

 

[photodog]

And that is the million dollar question.

 

[Irish Rover]

I don't think you will have any difficulty provided you obtain absolute proof of it's VAT paid status prior to purchase. You should then be able to avail of the promised Returned Goods Relief law in the event of a no deal B.

 

[langstonelayabout]

Sounds like a grey area to me.

Your location might complicate things further?
Are you ex-pat for tax purposes?
Are you going to be Uk resident when you take delivery of the boat?

Frankly you'd be bonkers to put too much store in amateur interweb opinions trying to apply logic where there often is none.

Oh blimey that’s true. My home is near Portsmouth but I’m legally resident in Saudi and the only tax here is 5% VAT on most things. I will be looking to put the boat onto the UK SSR. I'll be legally expat at time of purchase.

I believe that the boat is EU VAT paid which works everywhere in the EU/UK at the moment. I really don’t want to have to stump up an additional 20%. It will be a private purchase too (not through a broker).

I guess we can state any date we wish on the bill of sale…:nonchalance:

 

[lw395]

Technically it might not be covered by 'returned goods' relief as it won't be returning to the UK.
Not sure you can put it on SSR without a UK residence either?
AIUI, expats can bring quite a lot of chattels with them when they return, but you won't be bringing it from Saudi? Still, it's another avenue to explore perhaps?
You have left it quite last minute to DYOR. OR maybe not!

I wonder whether a UK domiciled company buying the boat might be useful?

You look like an 'edge case' and I wouldn't put much faith in the shaky general reassurances we've had.
There are gaps and flaws in the general advice IMHO and I really don't know how being an expat affects things.

 

[Sandy]

If I were to buy it later this month but still leave it in Ireland and collect it in spring 2020 would I be liable to pay UK VAT on it, even though it became a UK owned boat when I bought it? Your thoughts please?

Nobody knows.

 

[SteveSarabande]

OK, I’m about to look at a boat. It looks good in the pictures and the description and price nearly match up. Thing is, I’m in the Solent (UK) and the boat is in Republic of Ireland (Eire).

The fun thing is something called Brexit, currently scheduled for the end of this month.

If I were to buy it later this month but still leave it in Ireland and collect it in spring 2020 would I be liable to pay UK VAT on it, even though it became a UK owned boat when I bought it? Your thoughts please?

Just get someone to bring it back before brexit, then there isn’t a problem. If you have a uk address you can register it on the SSR.

 

[Rafiki]

Just get someone to bring it back before brexit, then there isn’t a problem. If you have a uk address you can register it on the SSR.

I agree this is the safest route. You could just have it brought back to somewhere in Wales and then a marina invoice would prove that it was moved tax paid within the EU before the UK left. I assume the distance to the nearest marina in Wales wouldn't be very large and you would be with the prevailing wind.
I'm not sure that owning it in a company and then using it personally is such a good idea. There are lot's of rules about receiving benefits from assets owned by a company, you could even find yourself treated as receiving a taxable benefit each year of 10% of the value of the boat - mind you if you aren't tax resident perhaps that wouldn't matter.

 

[lw395]

...
I'm not sure that owning it in a company and then using it personally is such a good idea. There are lot's of rules about receiving benefits from assets owned by a company, you could even find yourself treated as receiving a taxable benefit each year of 10% of the value of the boat - mind you if you aren't tax resident perhaps that wouldn't matter.

Yes, you'd need proper planning to go the company route. If the boat is less than the VAT threshold in value, the OP could maybe simply buy it from the company when he is resident. I've heard of people doing similar but the rules change all the time so DYOR.
I believe it can be OK to own a boat via a company, provided the boat is not loss making, but 'yacht' to a taxman is like a red rag to a bull.
I don't offer advice, just ideas to check out and unqualified opinion.

 

[Graham376]

It's a complicated situation. Returned goods relief wouldn't apply to the boat if you personally hadn't owned and taken it out of the UK. Has it ever been a UK VAT paid boat? Strictly speaking, unless ordinarily resident in UK, you can't register on SSR but plenty of "foreigners" get around that OK so I'm sure that can be sorted. My inclination would be to buy it, get it UK registered immediately but leave it in the EU (Ireland) until after B day (to retain EU VAT status) and then bring it home afterwards. Just another UK boat returning after a holiday cruise.

 

[dunedin]

Just get someone to bring it back before brexit, then there isn’t a problem. If you have a uk address you can register it on the SSR.

I would be careful about that option. That would lose EU VAT status.
The OP's circumstances are made complex by non UK residence. If had been UK resident the plan to leave in Eire and bring back in 2020 would have been ideal.

 

[duncan99210]

As I understand it, if a boat is EU VAT paid and outside UK on no deal B day, it will continue to be regarded as EU VAT paid. If it’s then brought back to UK, it will be regarded as an import and thus liable to VAT on arrival. However, there seems to be a loophole in that you should be able to claim returned goods allowance for it: that used to require having owned and used it overseas for a set period (used to be 2 years, then dropped to 18 months).

All of that is really speculation as no one seems to have a good read on exactly what’s going on. I’m still debating whether to bring my boat home from Greece or not. I need more certainty before making a decision.

 

[Sybarite]

The generating fact for VAT is the transaction. The transaction date is often associated with the delivery date.

I would suggest moving the boat from its current location as evidence of the fact that the transaction has taken place and then berthing it under your own name elsewhere, even if it is still in the RoI.

But I am not a VAT expert.

 

[JumbleDuck]

I agree this is the safest route. You could just have it brought back to somewhere in Wales and then a marina invoice would prove that it was moved tax paid within the EU before the UK left.

Will anyone actually care, though? I'm finding it hard to imagine who is going to examine every boat in Britain and ask their owners to prove where they were on B-day.

 

[lw395]

I don't think I'm taking it for granted that the UK will actually leave the Customs Union, or whether that might happen at the end of this month.
If we do leave then, a few used yachts are a bit of a detail in the short term, but in the long term the grip of bureaucracy tends to catch up.

 

[dunedin]

Will anyone actually care, though? I'm finding it hard to imagine who is going to examine every boat in Britain and ask their owners to prove where they were on B-day.

Like a house, it is when you come to sell that the paperwork may come under most scrutiny. The new buyer will want to be sure of the VAT status, particularly if the boat is worth a bob or two and/or the buyer is from Europe.
If the boat is an inexpensive MAB sold locally perhaps less so.

 

[SteveSarabande]

It will probably turn out to bea 23’ boat worth a few thousand, and then no one really will care

 

[Graham376]

Will anyone actually care, though? I'm finding it hard to imagine who is going to examine every boat in Britain and ask their owners to prove where they were on B-day.

The owner or future owner may care, depending on whether he wants to take it out of the UK or not. Unfortunately, EU States tend not be be as lax as UK when it comes to examining paperwork trails, particularly if they see a chance to boost income.

 

[JumbleDuck]

The owner or future owner may care, depending on whether he wants to take it out of the UK or not. Unfortunately, EU States tend not be be as lax as UK when it comes to examining paperwork trails, particularly if they see a chance to boost income.

But the paperwork will show that it has always been in Ireland ...