VAT matter.

[Sneaky Pete]

I’m considering buying a sail boat that is lying in Ireland. The boat had been registered by first owner in the UK. It was sold to a buyer in Ireland who re-registered it in that country, don’t know why.
Now that the UK is out of the EU if I conclude the purchase of the boat, and bring back to UK, would I be liable for VAT on the purchase price.

 

[dunedin]

Yes

 

[pandos]

I’m considering buying a sail boat that is lying in Ireland. The boat had been registered by first owner in the UK. It was sold to a buyer in Ireland who re-registered it in that country, don’t know why.
Now that the UK is out of the EU if I conclude the purchase of the boat, and bring back to UK, would I be liable for VAT on the purchase price.

Why wouldn't the last buyer register it in Ireland?...

Are you sure it is on the proper Irish register? We no longer have a ssr type of thing so it may not be registered at all...

I have heard of boats being sold via NI based brokers and due to the protocol vat was not an issue...

 

[Tranona]

Registration is irrelevant. If it was in Ireland on 31/12 2020 then it is EU VAT paid and if you import from EU into the UK you will b liable for VAT on import.

 

[Graham376]

If the seller is the person who took it from UK to Ireland, he/she can bring it back, claim RGR and then sell it to you without any VAT liability.

 

[Concerto]

If the seller is the person who took it from UK to Ireland, he/she can bring it back, claim RGR and then sell it to you without any VAT liability.

I believe only if he is a UK resident. Otherwise you will still have to pay VAT again. That is the rules, even though we all believe them to be morally wrong to pay VAT for a second time. One of the many joys of a poor Brexit negotiation.

 

[Graham376]

I believe only if he is a UK resident. Otherwise you will still have to pay VAT again. That is the rules, even though we all believe them to be morally wrong to pay VAT for a second time. One of the many joys of a poor Brexit negotiation.

Not sure about that, it's the movement of the boat over a customs border under different ownership which attracts duty and/or VAT. If under the same ownership as when exported, why would VAT be due?

 

[Mistroma]

Not sure about that, it's the movement of the boat over a customs border under different ownership which attracts duty and/or VAT. If under the same ownership as when exported, why would VAT be due?

Surely it would be EU goods if a French citizen bought it and moved it to France in 2020 and no chance of RGR now if sold in France to a UK resident.

An Irish citizen doing the same thing in Ireland should be the same if not normally resident in the UK then and now.

There is the small matter of Ireland being a special case in many ways.

 

[Irish Rover]

Careful about the difference between GB and UK. It's important for this purpose.

 

[AngusMcDoon]

Surely it would be EU goods if a French citizen bought it and moved it to France in 2020 and no chance of RGR now if sold in France to a UK resident.

The question is can an Irish citizen and resident claim RGR when reimporting a boat back into the UK that was previously in the UK. There's nothing in the rules I can find to say no...

Pay less import duty and VAT when re-importing goods to the UK

 

[AngusMcDoon]

Otherwise you will still have to pay VAT again. That is the rules, even though we all believe them to be morally wrong to pay VAT for a second time. One of the many joys of a poor Brexit negotiation.

The 3 year rule wasn't part of the B negotiation. The EU, long before B, created the directive that boats that spend more than 3 years outside the EU have to pay VAT again on return. It's been carried over into UK rules after B. The UK can now change it if it wishes, but probably won't.

 

[Graham376]

The 3 year rule wasn't part of the B negotiation. The EU, long before B, created the directive that boats that spend more than 3 years outside the EU have to pay VAT again on return. It's been carried over into UK rules after B. The UK can now change it if it wishes, but probably won't.

Yes but don't forget it has always been the case that the 3 years can be extended in both UK and EU at the discretion of Customs. What I'm suggesting is that to obtain RGR within 3 years or, during the extended period if granted, I have only seen mention of ownership and don't see anything regarding residence of owner. Of course I may be missing something, it's 20+ years since I cancelled my VAT registration and closed the company.

 

[Tranona]

That is correct. There is no restriction to just UK citizens/residents. VAT is on the transaction involving the goods. Remember the rule was for all goods ,moving in and out of the EU as it was or the UK as it is now, not just boats. It really only becomes an issue for boats because many go out for longer. Now anybody popping over to Cherbourg for the weekend (and other short term visits) with a UK VAT paid boat will be making use of RGR when they return through the filing of the C1331 and getting clearance.

When buying or selling boats across customs areas you have to look at the specifics of the transaction and apply the rules as written. The RYA/BMF have published a document which shows how the rules are applied in most of the common scenarios.

 

[AngusMcDoon]

That is correct. There is no restriction to just UK citizens/residents. VAT is on the transaction involving the goods. Remember the rule was for all goods ,moving in and out of the EU as it was or the UK as it is now, not just boats. It really only becomes an issue for boats because many go out for longer. Now anybody popping over to Cherbourg for the weekend (and other short term visits) with a UK VAT paid boat will be making use of RGR when they return through the filing of the C1331 and getting clearance.

When buying or selling boats across customs areas you have to look at the specifics of the transaction and apply the rules as written. The RYA/BMF have published a document which shows how the rules are applied in most of the common scenarios.

In the HMRC website I linked to above it says that an extension to the 3 year rule is allowed for UK residents re-importing personal goods. It lists pleasure craft. Whether that was always the case before the current temporary extension, or that is the temporary extension, I don't know. The document was updated in December 2021.

The requirement that the goods must be returned no more than 3 years after the date of export will be waived if any of the following circumstances apply:
...<irrelevant stuff removed>

The requirement will also be waived if:

• personal property of a UK resident is being returned to the UK for either:
  • personal (non-commercial) use of a UK-resident person
  • meeting household needs of a UK-resident person

‘Personal property’ includes:

• cycles, motor cycles, private motor vehicles (and their trailers), camping caravans, pleasure craft and private aircraft
• ...<other stuff>

 

[Graham376]

Seems I was wrong. It's a while since I last read the guidance notes and now see they were updated last December and residence is a factor as Angus says above.

1. 29 December 2021
   The 'Normal time limits for returning goods' section has been updated to reflect recently introduced legislation that explains how the waiver to the 3-year rule applies.

 

[Tranona]

Yes, this was the post Brexit concession to deal with the difficulties of people moving back from Europe as a consequence (plus Covid delays) which is why it is restricted to personal possessions. There is also the "Returning Residents" relief which has always been there but which is more specific and restricted being determined by the owner taking up residence in the UK rather than just bringing personal property in.

 

[Sneaky Pete]

Spoke to customs and excise today bottom line was that they have had no experience of this, not sure but thought I may be ok, NOT GOOD ENOUGH. Told me to phone border force, there is one in Edinburgh, chap said I think you would be ok, but best try customs and excise who deal in VAT matters. Fine. So sent e-mail to a link that deals in vehicles coming back into UK from EU. Waitout.

 

[Tranona]

Spoke to customs and excise today bottom line was that they have had no experience of this, not sure but thought I may be ok, NOT GOOD ENOUGH. Told me to phone border force, there is one in Edinburgh, chap said I think you would be ok, but best try customs and excise who deal in VAT matters. Fine. So sent e-mail to a link that deals in vehicles coming back into UK from EU. Waitout.

No point in talking to general customs people. This is the place for the rules www.gov.uk/guidance/sailing-a-pleasure-craft-that-is-arriving-in-the-uk Scroll down the the section on Declaring an import and you will get the contact in Portsmouth which specialises in importing boats.

From what you have said - the boat is in the EU and outside the UK and if you are a UK resident importing the boat into the UK from outside it is liable for VAT. It is irrelevant how it got to be in the EU. VAT is a tax on the current transaction which will be importing the boat and from what you say it (and you) are not eligible for any of the reliefs.

 

[dunedin]

You could ask the rules for moving from Ireland to Northern Ireland (then to GB)? Nobody seems to know how this should work (least of all those in London who agreed the protocol) and MAY be a loophole (tax avoidance not evasion). But I doubt string likelihood of HMRC saying it is OK.