VAT in France

[doug748]

Again.

I have just posted this to the RYA:

"RYA
Ensign Way
Hamble
SO31 4YA

Dear Sir,

Earlier this summer, whilst on passage from UK to Brest, I was approached by French Customs Officers at L'Aberwrach.

After inspecting my passport and ship registration papers, I was asked for proof that VAT had been paid on the original purchase price. The boat is an unexceptional 1979 built sailing cruiser. My response was that I had little with me but that is was an old boat and normally considered exempt from close scrutiny. After a few words with his colleagues the matter was not pursued. However the parting words were, as near as I can remember them:

“You know, you should carry your VAT papers - we can ask to see them”

I must stress that the exchange was very positive and the comment came across as friendly advice. This time.

Two points:

This exchange confirms that, at the very least, VAT accountability on old boats is a topic of conversation at some official level in France.

It begs the question as to what would happen if the matter were pressed. I am sure that such evidence I have would not pass muster. Many owners will have nothing at all to show.

I am not a member but in view of published advice thought that you would wish to know of developments on the ground.

Yours etc"

 

[sailorman]

Again.

I have just posted this to the RYA:

"RYA
Ensign Way
Hamble
SO31 4YA

Dear Sir,

Earlier this summer, whilst on passage from UK to Brest, I was approached by French Customs Officers at L'Aberwrach.

After inspecting my passport and ship registration papers, I was asked for proof that VAT had been paid on the original purchase price. The boat is an unexceptional 1979 built sailing cruiser. My response was that I had little with me but that is was an old boat and normally considered exempt from close scrutiny. After a few words with his colleagues the matter was not pursued. However the parting words were, as near as I can remember them:

“You know, you should carry your VAT papers - we can ask to see them”

I must stress that the exchange was very positive and the comment came across as friendly advice. This time.

Two points:

This exchange confirms that, at the very least, VAT accountability on old boats is a topic of conversation at some official level in France.

It begs the question as to what would happen if the matter were pressed. I am sure that such evidence I have would not pass muster. Many owners will have nothing at all to show.

I am not a member but in view of published advice thought that you would wish to know of developments on the ground.

Yours etc"

Why not support the RYA & join as a full member. after they are there to look after our interests & i have been paying your share to date & the past 40 yrs

 

[doug748]

Why not support the RYA & join as a full member. after they are there to look after our interests & i have been paying your share to date & the past 40 yrs

The gesture is appreciated.

I was thinking of not joining the AA, do you also chip in for me with them?

 

[toad_oftoadhall]

Why not support the RYA & join as a full member. after they are there to look after our interests & i have been paying your share to date & the past 40 yrs

I don't contribute to my local history society. Could you chip in to them for me as well? I assume you already contribute to all the Historical/Archeological Societies in your area. They're working in your interests, after all, why should others subsidize you?



OP: IMHO you should contact French Customs, thank them for letting you off and asked them what law you would be breaking if you failed to produce in future.

“You know, you should carry your VAT papers - we can ask to see them” means nothing. I'm perfectly entitled to ask to see your socks. It doesn't mean you have to wear socks or that you have to show me them.

You can contact French Customs here:
http://www.douane.gouv.fr/menu.asp?id=1

I really don't see how the RYA can guess what was in the mind of this customs guy. He might be wrong about his law, he might be aware of a recent change to the law, or he might just be making it up as he goes along. (Plenty of examples of enforcement types making up powers off the top of their heads on youtube.)

Finding out the reasoning of French Customs on this will take you 20 minutes and save the RYA potentially unlimited research.

When you find out what law(s) French Customs think you've fallen foul of I reckon you should inform the MCA and UK customs. If there's some law nobody is aware of they're probably better placed to advise the RYA rather than the other way round IYSWIM.

 

[JumbleDuck]

OP: IMHO you should contact French Customs, thank them for letting you off and asked them what law you would be breaking if you failed to produce in future

I get very confused by all this VAT stuff. As I understand it (a) the VAT due on the original sale was payable by the original purchaser, and not by anyone he may have sold the boat to, or anyone they may have sold the boat to, or anyone they may have sold the boat to and (b) even if I have VAT receipts for every sale back to the original, I could still have done something which made the boat VAT liable again.

So they seem to be asking for proof of a liability which isn't the OPs and ignoring a liability which might be the OP's. Have I got that right?

 

[Twister_Ken]

Yachts in the EU pre-1985 are deemed to be VAT paid. However, it's possible you might be asked to prove that the boat was in the EU at that time. A builder's certificate, boatyard bills or mooring receipts dating from back then seem to be regarded as sufficient proof. So if you have such papers, it would be good to carry them aboard. And it seems the French like originals, not copies.

 

[toad_oftoadhall]

So they seem to be asking for proof of a liability which isn't the OPs and ignoring a liability which might be the OP's. Have I got that right?

I think you're right & that the idea of it being illegal to visit France without 'proof of VAT status' [1] is total nonsense for all the usual reasons stated.

I find JFM's posts on this topic quite useful - this thread has both sides of the case spelt out for us:

http://www.ybw.com/forums/showthread.php?228526-Vat-Paid-Invoice&p=2429843#post2429843

I still think it's worth OP using this encounter as a reason to check with French Revenue and pass some facts on to the MCA and UK Customs. Maybe it will reveal some new information and certainly can't hurt.



[1] Whatever that is. A receipt showing a company charged an extra 17.5pc on a sale which they say was for VAT doesn't prove any VAT was paid.

 

[Twister_Ken]

[1] Whatever that is. A receipt showing a company charged an extra 17.5pc on a sale which they say was for VAT doesn't prove any VAT was paid.

I have a receipt from HMRC for VAT on my boat. That'd do on a new boat, dunno what you'd do for an older boat unless the original owner passed on all the paperwork.

 

[toad_oftoadhall]

I have a receipt from HMRC for VAT on my boat. That'd do on a new boat, dunno what you'd do for an older boat unless the original owner passed on all the paperwork.

These arguments have been ongoing forever, I'll post a good thread on this from the past again:

http://www.ybw.com/forums/showthread.php?228526-Vat-Paid-Invoice&p=2429843#post2429843

We don't need to cover old ground.

Maybe the OP will get some new facts from French Revenue which will open a new avenue of discussion.

 

[macd]

I have a receipt from HMRC for VAT on my boat.

Then you're in a minority. Most boats, if they have an original receipt at all, have one from the seller and, last I heard, HMRC wasn't in the yacht sales business.

 

[tjbrace]

We bought our yacht in France in 2006, it is 1991 vintage. I don't know if original receipts were available, but Roland Vergriette, the owner of SNIP Yachting and the broker, made certain that we had a certificate which absolutely stated that all taxation was paid. I have showed this in Dieppe subsequently, and it was never questioned.

 

[Twister_Ken]

Then you're in a minority. Most boats, if they have an original receipt at all, have one from the seller and, last I heard, HMRC wasn't in the yacht sales business.

No, but they're very definitely in the business of collecting VAT when a new boat is sold.

 

[Sybarite]

Yachts in the EU pre-1985 are deemed to be VAT paid. However, it's possible you might be asked to prove that the boat was in the EU at that time. A builder's certificate, boatyard bills or mooring receipts dating from back then seem to be regarded as sufficient proof. So if you have such papers, it would be good to carry them aboard. And it seems the French like originals, not copies.

I believe that the douanier made a simple mistake. I also believe the onus would be on him to prove that the pre-1985 boat was not in the EU at the time.

However, as you say, if you have the paperwork it saves a lot of hassle..

 

[macd]

No, but they're very definitely in the business of collecting VAT when a new boat is sold.

Very much so. But the only time they will issue is receipt is in the event of someone importing a boat and paying them the VAT directly. In every other case the receipt is from the the last VAT-registered vendor in the purchase chain...and, as Toad has said, all that demonstrates is that VAT was paid to the vendor, not necessarily to HMRC. Hence, if you have the "receipt from HMRC"" that you describe, you're in a small minority.

 

[toad_oftoadhall]

I have a receipt from HMRC for VAT on my boat. That'd do on a new boat,

I can't resist.

I don't see how a HMRC VAT receipt can prove VAT has been paid on a new boat.

I presume HMRC collect the importer/builders VAT at the end of the financial year and it isn't itemized per sale.

So at the point the boat is bought HMRC have no idea if VAT will be paid. Even if they issue you a receipt (up to 2 years later?) once Sunseeker (or whoever) pay their VAT bill in full HMRC still have 7 years to investigate Sunseeker at which point they might find out that Sunseeker (or whoever) hadn't paid their VAT bill in full at all.

Even so, lets say that an HMRC receipt does satisfy whatever French law that requires me to prove the company I bought stuff from has paid their VAT bill. Lets say a boat owner has one for his boat. Presumably every other item on the boat is still 'illegal' without it's HMRC receipt. Wrist watches, ipads, phones, binoculars, charts. Taken as a whole a boat is a collection of thousands of things that will have been acquired in VATable transactions, hard to imagine there's a requirement to prove that Cotswold Outdoor paid their VAT bill the year someone bought their bag in one of their shops.

I believe that the douanier made a simple mistake.

No he didn't. He said: “You know, you should carry your VAT papers - we can ask to see them”. A sentence so vague I can't see how it could be wrong.

Can he ask to see "VAT papers"? Yes, he can ask for anything he wants to ask for. Anyone can. He doesn't say any law is broken if the request is not complied with.

People should carry "VAT papers"? "Should" can mean there's an obligation but it doesn't have to. Who knows what sense it was meant. It just as likely he meant "You should carry a "VAT papers" because it helps us fill in our search form quickly." Hopefully the OP can get in touch with French Revenue and clarify exactly what he was told.

So many of these legal misunderstandings are caused by the misconception that something requested by someone in a uniform is always legally required. I was asked to show my camera to a Spanish policeman once. Cameras aren't legally required in Spain AFAIK.

I'm just waiting for an HMRC bloke to ask for a cup of tea. YBW will go into meltdown. I can imagine the posts saying every uk flagged vessel must carry full tea making facilities, including sugar and choice of full fat, semi, and skimmed milk.

I was determined not to post further on this thread, it's all been said before. YBW is addictive.

 

[Deleted member 36384]

...... I'm just waiting for an HMRC bloke to ask for a cup of tea. YBW will go into meltdown. I can imagine the posts saying every uk flagged vessel must carry full tea making facilities, including sugar and choice of full fat, semi, and skimmed milk. .....

This will probably be a tax deductible expense, I will ask for a receipt.

 

[Twister_Ken]

I can't resist.

I don't see how a HMRC VAT receipt can prove VAT has been paid on a new boat.

I presume HMRC collect the importer/builders VAT at the end of the financial year and it isn't itemized per sale.

In my case I bought a new boat from Sweden, paying the builder direct.

I then submitted a form to HMRC for Payment of VAT on an imported 'means of transport' giving the price paid in SKR, and the exchange rate at the time of transaction.

HMRC then billed me for the VAT

I returned the bill with an appropriate cheque.

HMRC returned the bill, stamped 'paid'.

I keep the receipted bill on the boat.

The UK office for the builders acts just as an information/facilitation point and not as a sales agent, so my payments (except for launching and commissioning charges) went directly to the builder.

 

[toad_oftoadhall]

[1] Whatever 'proof of VAT status' is. A receipt showing a company charged an extra 17.5pc on a sale which they say was for VAT doesn't prove any VAT was paid.

I have a receipt from HMRC for VAT on my boat. That'd do on a new boat,, dunno what you'd do for an older boat unless the original owner passed on all the paperwork.

I don't see how a HMRC VAT receipt can prove VAT has been paid on a new boat.
I presume HMRC collect the importer/builders VAT at the end of the financial year and it isn't itemized per sale.
So at the point the boat is bought HMRC have no idea if VAT will be paid. Even if they issue you a receipt (up to 2 years later?) once Sunseeker (or whoever) pay their VAT bill in full HMRC still have 7 years to investigate Sunseeker at which point they might find out that Sunseeker (or whoever) hadn't paid their VAT bill in full at all.

In my case I bought a new boat from Sweden, paying the builder direct. HMRC then billed me for the VAT I keep the receipted bill on the boat.

Sorry I haven't been clear. I'm not questioning your own HMRC receipt proves VAT was paid on your transaction. I'm disputing that would always be the case on new boats as you originally said. In most cases it won't be. New or old. For the reasons I state.

 

[Tranona]

I'm disputing that would always be the case on new boats as you originally said.

Show me where he said that? All he said was that he had an HMRC receipt for his boat, not that all new boats had one. You seem to read into it something that was not there.

 

[toad_oftoadhall]

Show me where he said that?

Quoted in bold in the post you're replying to:

I have a receipt from HMRC for VAT on my boat. That'd do on a new boat, dunno what you'd do for an older boat unless the original owner passed on all the paperwork.