VAT Paid Status - What can you prove ?

[macd]

(Not a response to Richard in particular, just tagging onto the end of the thread)
Where in statute does it state that boats enjoy unique VAT status? I have cameras on board, TV, and stacks of other peraphernalia, all of which attracted VAT when purchased new. But does it occur to me to keep evidence of that VAT payment with me? Not for a second. Buy a used car, and of course you always carry VAT evidence in the glove box. Not. So why oh why is it such an issue with boats? The answer, I'm coming to believe, is that it's not -- but for some reason some authorities would like us to think it is.

There was a long and authoritative thread on the subject a few weeks back (I've just done a fruitless search for it, but it's worth the trouble if you missed it). A must read and a call to arms if ever I saw one.

Incidentally, my boat's old enough to be 'deemed VAT paid' or whatever the expression is. To back this up, for years a succession of owners has carted around a poor photocopy of a letter from a marina stating that on an arbitrary date years ago, Morwenna was on one of their berths. No description of the boat, no hull number, just 'Morwenna'. So if you want VAT evidence for your boat, just re-name it Morwenna and I'll gladly send you a bad photocopy of the bad photocopy, you can buy me a beer, so I'll be happy, you'll be happy and beaurocrats everywhere will also be happy. What a load of bollox.

 

[Tranona]

I am not arguing with you in principle as VAT has to be paid anywhere you buy a boat in the EU. What I am saying along with many others on these fora is that in practice there is no way that you can ever prove that VAT has been accounted for correctly as an owner because it is not your responsibility, but that of the VAT registered vendor. Your VAT receipt is only evidence that you paid the money to the vendor, not that it was then paid to the Revenue.

If you buy a boat privately from another private EU resident there is no VAT on the transaction and therefore no VAT receipt. There is no evidence (in the UK at least) that the Revenue have pursued any individual boat owner for non payment of VAT on an existing boat unless it has been inported by an individual from outside the EU without declaring and paying VAT. This is clearly an offence. This does not mean that VAT offences don't occur with boats, but the only person who can commit an offence is a VAT registered vendor or a private person importing a boat (or any other asset on which VAT is levied such as a car).

I am not saying either that registration is proof of VAT, simply pointing out that if the boat is normally kept in the UK it is presumed that any VAT issues are the responsibility of the UK HMRC.

No Customs authority can hold your boat without getting a court order, and as there is no offence connected with not having a VAT receipt no court would allow that. It is different if the VAT offence is committed by a VAT registered trader or where there has been an attempt to evade VAT on importation.

Hundreds, probably thousands of boats change hands between private individuals every year without any VAT "paperwork" because in practice there is no problem.

It is not the location of the boat that necessarily determines where VAT is paid, it is the location of the seller. For example, I could buy a boat from a UK dealer for delivery to the Med. If I pay the dealer in the UK I will be paying VAT in the UK. Remember VAT is not a tax on the asset (boat) but on the transaction.

If you have any concrete evidence, for example by court cases that boats have been impounded and owners pursued for VAT then I am sure many here will be interested in hearing about them. This question gets asked regularly here and no evidence has been forthcoming. The RYA has asked all its members to report any incidents to them and again nothing has happened.

 

[pheran]

Of possible interest to anyone contemplating the purchase of a second-hand boat in Holland. If the original VAT-paid receipt is not available, you can invite the Customs authority to inspect what documentation is available and give them authority to make other enquiries. They will then exercise their judgement and if they decide VAT probably has been paid, they will issue a certificate to this effect. This is a gem because the wording effectively tells other EU authorities to butt out!
I did this. The service was free and the Dutch customs man was very proud of the fact that Holland is the only EU country to do this. HMCE please note - its obviously not rocket science!!

 

[PeterGibbs]

Q - Where in statute does it state that boats enjoy unique VAT status? I have cameras on board, TV, and stacks of other peraphernalia, all of which attracted VAT when purchased new. But does ...........

______________________________________
Transport vehicles - boats coming under this description - have been singled out for special treatment - CE has a pamphlet on the subject, which is as helpful as an candle in a gale, of course..

As the above posts show clearly, this was a piece of law shoved together without consideration of the practicalities of applying it over time.

A bill of sale from a defunct broker or agent showing VAT paid is clearly uncheckable and therefore worthless - it could easily be contrived on a PC! There is no official central national registry (as for land) to maintain records over the life of the asset. So, in extremis - ie when the authorities get nasty - they can seize the asset against a new VAT payment.

As with so many technical threats to happiness in this life - like multiple fines for driving at 31mph in a 30 mph zone - it doesn't happen. But every year someone will be fried because legislators like to legislate, and have no real interest in the application of law - that's up to the courts.

Who's going to be the first fallguy for the new diessel regs.. can you feel the grip of CE on your collar...?

And so we pass on to the upcoming joys of E Borders...now what will I do if I can't make my posted passage, and have a non- EU citizen on board..oh my...

PWG

 

[macd]

"Transport vehicles - boats coming under this description - have been singled out for special treatment"
Doesn't that apply only to importing? I've just checked out the Gov's own advice on buying a vehicle (within the UK, not from another EU country) -- www.direct.gov.uk/en/Motoring/BuyingAndSellingAVehicle/AdviceOnBuyingAndSellingAVehicle/DG_4022402 -- and nowhere does it mention VAT, much less evidence of payment of same.

And, as you say, 'proof' of payment of VAT is largely illusory. I was registered for VAT for years and my statements to them never indicated on what VAT was reclaimed or levied on an item-by-item basis. All that the VAT man gets is a nett bottom line. In normal circumstances he could not say with certainty that VAT has been accounted for on a specific item, merely that for the period when a particular transaction took place the books appeared to balance (and usually, barring a VAT inspection, he took even that on trust). The only evidence of individual VAT amounts was in my books and receipts, most of which have since been lobbed -- quite legally -- in a skip.

This is quite different from an import tax where, presumably (I've never done it) you get an official receipt on payment of the duty, tying it uniquely to the imported goods. The same may well apply to VAT paid on an imported boat, but such transactions are a relative rarity compared to the usual private individual to private individual sales within the same country.

Did someone mention bollox?

 

[gjgm]

only had this view second hand, but "deemed paid" apparently is a tax status that meets whatever criteria (dont ask me!).
Apparently the word deemd in this context isnt the ususal English language meaning.
I ve been through this episode with VAT an HMRC,RYA and specialist marine solicitors, so I can speak with more experience than many perhaps.
In my experience, you need to speak to the right person, and ask the right question. If you ask how to do something that is impossible, you wont get very far.

 

[sailorman]

i can prove VAT not paid & is now EXEMPT from VAT /forums/images/graemlins/grin.gif /forums/images/graemlins/grin.gif

 

[mcframe]

[ QUOTE ]
Well, it is not actually their job. VAT seems to be the responsibility of the state where the Boat and owner reside - although that in itself is unclear. The official advice from our HMRC is that other states will not pursue VAT issues related to British boats.

This does not mean to say that they won't investigate if they think that an offence may have been committed in relation to VAT. However, not having a receipt is not an offence!

[/ QUOTE ]

OMG! It's another Red Ensign thread!

<Warning>
Do not hoist Red Ensign on recently-bought Bavaria after visit to UBS cashpoint unless in UK waters. /forums/images/graemlins/laugh.gif