VAT Not Paid

[DavidBolger]

Hi,

We are thinking about looking at getting an boat down in the Med and have been looking on line at a few options. Many boats state that the VAT is not paid. What does that mean for a private purchaser. I assume these boats have been in a charter company which is VAT registered. If I don't buy it as a VAT registered company/person, do I need to pay the VAT on the price we pay and at what rate? Is it the rate in the country where the boat is flagged or about to be flagged (my own home country)?

Appreciate the advice in advance.

regards

David

 

[Pasarell]

If it's not VAT paid then you are liable for it as a private purchaser. I believe you have to pay it in the country where you buy the boat. Having said that, I know a few people who have bought ex charter boats and not paid the VAT in Greece, although if their papers were checked I imagine they would be hit pretty hard.

 

[duncan99210]

Pretty simple really. A non VAT paid boat has probably been owned by a charter company who either reclaimed or never paid the VAT. As the purchaser you are responsible for paying the VAT in the EU country where the sale takes place.

However, there’s another route for a boat not being VAT paid: if it’s been imported from outside the EU it may well not yet have VAT paid. If that’s the case, you also need to check if there paperwork showing it conforms to the RCD as well as sorting out the VAT situation.

 

[skipper681]

Thanks for explaining.

That is something I've never understood either.

Thank you.

 

[skipper681]

Just noticed my post count is 666. That's bad so I'm posting this to make it this one more.

Math Teacher: "If I have 5 bottles in one hand and 6 in the other hand, what do I have?" Student: "A drinking problem."

What's the difference between men and pigs? Pigs don't turn into men when they drink.

The future, the present and the past walked into a bar. Things got a little tense.

I just found out I'm colorblind. The diagnosis came completely out of the purple.

 

[ithet]

Pretty simple really. A non VAT paid boat has probably been owned by a charter company who either reclaimed or never paid the VAT. As the purchaser you are responsible for paying the VAT in the EU country where the sale takes place.

Yes and no. Effectively the VAT is an extra sum paid by the buyer. But in these circumstances it is the SELLER (as a VAT registered entity) that is responsible for collecting it (issuing a VAT invoice) and passing on to the appropriate VAT authorities.

 

[RichardS]

If it's not VAT paid then you are liable for it as a private purchaser. I believe you have to pay it in the country where you buy the boat. Having said that, I know a few people who have bought ex charter boats and not paid the VAT in Greece, although if their papers were checked I imagine they would be hit pretty hard.

The traditional way around this is to actually purchase the boat by signing contracts and transferring monies whilst offshore in international waters. Some dated and timed photos of the sale "ceremony" are also usually taken.

The boat can then be taken to where VAT is to be paid or sailed to somewhere where there is a time dispensation before VAT becomes due.

Richard

 

[Graham376]

In addition to the above info, even if you buy a VAT paid boat outside the EU, Turkey for instance, as an EU resident you are liable for VAT when you bring it in. Sales often appear to have taken place in Greece for this reason.

 

[davidwf]

When I bought my new boat 5 years ago the Vat was paid in the UK as this is the country of use. I had to provide proof to the boat builder in the Netherlands that it was paid. The National Unit for Personal Transport , Dover HMRC 01303 664171 is responsible for collecting the VAT. They are really helpful and worth giving them a call, then you will know from the horses mouth your position.

 

[duncan99210]

When I bought my new boat 5 years ago the Vat was paid in the UK as this is the country of use. I had to provide proof to the boat builder in the Netherlands that it was paid. The National Unit for Personal Transport , Dover HMRC 01303 664171 is responsible for collecting the VAT. They are really helpful and worth giving them a call, then you will know from the horses mouth your position.

I think that’s only applicable if you’re buying a new build boat and exporting it to another EU country within a certain timeframe.

 

[superheat6k]

I believe if you conduct the transaction in International waters you can then declare the boat imported into the EU at the next port of call, so pick a port in a low VAT rate Country. Gibraltar used to be a favourite for this, but as it will likely join us next month as part of the Brexit departure from the EU I doubt Gib will work any more.

 

[Graham376]

I believe if you conduct the transaction in International waters you can then declare the boat imported into the EU at the next port of call, so pick a port in a low VAT rate Country. Gibraltar used to be a favourite for this, but as it will likely join us next month as part of the Brexit departure from the EU I doubt Gib will work any more.

Gibraltar is a British Overseas Territory, and also part of the European Union, but under Article 28 of the 1971 UK Accession Treaty it is not part of the European Union VAT Area.

 

[macd]

Gibraltar is a British Overseas Territory, and also part of the European Union, but under Article 28 of the 1971 UK Accession Treaty it is not part of the European Union VAT Area.

It has never been part of the customs union, either, Graham, so I'm as doubtful as you about superheat's suggestion that it could facilitate union goods status. Mind you, VAT payments are very attractive there, mainly because they don't exist.

 

[Graham376]

It has never been part of the customs union, either, Graham, so I'm as doubtful as you about superheat's suggestion that it could facilitate union goods status. Mind you, VAT payments are very attractive there, mainly because they don't exist.

Goods delivered from UK for boat in transit can be had VAT free but, for every item I checked, was still expensive due to carriage charges and Gib tax. Shepherds prices were a joke, dearer than UK with VAT

 

[Boo2]

Gibraltar is a British Overseas Territory, and also part of the European Union, but under Article 28 of the 1971 UK Accession Treaty it is not part of the European Union VAT Area.

Does this mean that VAT is not payable on any transfer of ownership of a yacht which takes place in Gib ? If so then why don' t all such transfers take place there ?

Boo2

 

[Graham376]

Does this mean that VAT is not payable on any transfer of ownership of a yacht which takes place in Gib ? If so then why don' t all such transfers take place there ? Boo2

I have no idea about tax on boat sales in Gib but would assume changing ownership there a bit pointless as VAT would still be due on its import to UK or EU if owned by a resident of either.

 

[macd]

I have no idea about tax on boat sales in Gib but would assume changing ownership there a bit pointless as VAT would still be due on its import to UK or EU if owned by a resident of either.

+1
As a consequence of which, I think, sales of Gib boats that already happen to be EU VAT- paid are often conducted elsewhere to preserve that status.
Boats imported to Gib, on the other hand, seem to be subject to 12% import tax if remaining there for six months or more.

And a merry, tax-light Christmas to all.

 

[Graham376]

From EU VAT site -

Importation of goods from outside the EU
Basic rule
The chargeable event occurs – and VAT becomes chargeable – when the following types of goods enter the EU:

• goods from EU territories not covered by EU VAT rules that are in free circulation.

 

[srah1953]

Is the VAT payable on the original new price or the price now being paid?

 

[Graham376]

Is the VAT payable on the original new price or the price now being paid?

Payable on the value at time of import. A Dutch couple I discussed it with in Spain said the authorities asked them to value the boat and were quite lenient.