VAT PAID?

[dignity]

I sold a motor cruiser last year, I bought it second-hand, just had the new owner on the phone requiring proof of VAT been paid. How can I proof this with no original documentation, bearing in mind I sold it nearly a year ago?

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[squidge]

As it was secondhand when you bought it if it was built prior to 1985 in the EU I think that it is Vat exempt any way. You could find out by searching in the forum as it has cropped up before.
Good luck /forums/images/icons/smile.gif

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[tony_brighton]

did you not have an original bill or sale? Or a marine mortgage?

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[dignity]

All done with cash, did have a bill of sale once but unfortunately it got lost over the years! Even a second-hand bill of sale wouldn't prove payment, or would it?

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[AndrewB]

Caveat emptor!

I expect your buyer is now trying to sell and finding his buyer is demanding proof of VAT status.

When you sold the cruiser, did you specifically represent it to the buyer (or to your broker if you used one) as being VAT paid? If you didn't, then this isn't your problem, and it would be best not to get involved.

If you can't get out that way, then you may be in trouble. However, there may be some ways out.

If the yacht was built prior to 1st January 1985 and was inside the EU on 31st December 1992, then it is exempt from VAT. But you must have proof - technically a customs form 'SAD' should have been obtained for the yacht back in 1993. In practice though any clear proof it is older than 1985 seems to be acceptable.

Yachts built before 1st January 1993 and then worth less than £4,000 are also exempt: if you sold the cruiser second-hand for less than £4,000 then in practice VAT won't be a concern.

Can you trace the manufacturer? Even if no longer in business, this may be helpful, as a copy of the original receipt may exist. I've heard that customs may be willing to grant VAT-paid status even without this, if the cruiser was built in the EU and the manufacturer can confirm it would not have been originally sold as a VAT-free export.

Finally, you could try laying the same onus of proof on the guy who sold it to you ... if he told you it was VAT paid.

 

[dignity]

Re: Caveat emptor!

The person who bought it off me is going to france with the boat, so I think he's just covering his own back. Unfortunately the gentleman I bought it from died.

Been looking on Custom Excise website, it states that a private bill of sale between two individuals would suffice.

The boat was built by Silva Yates back in 1985 cannot seem to trace them.

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[AndrewB]

Re: Caveat emptor!

Yes, not a bad idea to contact Customs. I found them helpful when I was having trouble establishing my yacht's VAT situation. Basically they were prepared to write a note saying they would regard the yacht as VAT paid, pretty much on the basis that we didn't seem to be trying to pull a fast one. Mind you, we had better documentation than you do.

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[rich]

Re: Caveat emptor!

Silva Yates, Gone for ever,, the boats are now built in guernsey...

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[Guest]

Re: Caveat emptor!

I have just been through the VAT mill as we are hoping to go to France this year.After checks on the Web I phoned the Customs helpline who were helpful but useless.I ended up speaking to several Customs units scattered around the country before finding someone who understood the problem and was able to tell me that they no longer give letters verifying VAT status of vessels as they have no legal validity.You may be able to do a talking job on a personal visit to HM Customs local to you on a totally unofficial and goodwill basis and get some sort of letter but this is unlikely.Then contacted the RYA Legal Dept. who advised simple bill of sale will suffice and that it should be pointed out to the Douaniers that the collection of VAT is a matter for HM Customs.As a former member of the Constabulary I can safely say that the veracity which any form of stamp confers upon a document cannot be overstated.It would appear the French have the same reverence for official stamps.These plus lots of paperwork in a neat folder coupled with a very good attitude may carry the day.Good luck!

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[AndrewB]

Re: Caveat emptor!

I've also heard that the RYA have been giving the advice that if the yacht is UK owned and registered, then other EU countries will accept that VAT payment, and equivalently RCD compliance, is the responsibility of UK authorities.

As so much with the EU, the practice may work out differently. A few years ago I saw an English owner grilled in Portugal (Lexios) because he had no VAT evidence for his SSR registered yacht. Certainly he was held up over this, and was being threatened with having to pay, but I don't know the eventual outcome. And a recent bill of sale between private owners on its own is no proof that VAT has been paid.

 

[vyv_cox]

Re: Caveat emptor!

When our boat was registered Part 1 I went through a long search process to establish that VAT had been paid. My understanding, possibly optimistic, was that Part 1 was proof of payment or waiving of same within the definitions described further up the thread.

SSR proves absolutely nothing but reference to boat name was useful in following the ownership chain for me.

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[extravert]

Re: Caveat emptor!

Who in customs did you contact? Whenever I have tried to contact customs I just get a national help line who are not much help at all.

<hr width=100% size=1>Adventures of the <A target="_blank" HREF=http://www.xrayted.fsnet.co.uk>Teddy Bear Boat</A>

 

[Guest]

Post deleted by danfoley

 

[extravert]

Re: Caveat emptor!

This is all just a real mess. What is the answer? I am selling a boat, the purchaser wants proof that VAT has been paid, I haven't got it, so what next? Am I just going to have to stump up 17.5% of the value of my boat in order to make it sellable?

<hr width=100% size=1>Adventures of the <A target="_blank" HREF=http://www.xrayted.fsnet.co.uk>Teddy Bear Boat</A>

 

[gtmoore]

Not just the RYA though...

...the Customs and Excise Notice 8 "Sailing your pleasure craft to and from the United Kingdom" describes the documentation required to prove the vessels age and location on 31/12/92 and then says:

"If you are unable to provide any of the above, whilst cruising within the EU you should carry a Bill of Sale (between two private individuals in the UK). Whilst this is not conclusive proof that VAT has been paid, it does indicate that tax status is the responsibility of UK Customs."

It also goes on to say

"It is also advisable to contact the relevant authorities in the Member State, or their Embassy in the UK, to confirm what documentation will be required in advance of your voyage."

....so I guess that's like a disclaimer.

Anyway, I carry a copy of this notice with me (not that I've sailed to Europe yet). It was given to me by an official at the Customs and Excise stand at last years Southampton Boat Show after discussing the issue.

As you described though - in reality it maybe not so simple.

<hr width=100% size=1>Gavin

 

[Neal]

Do you know where the boat had arrived from?

Andrew, the boat you saw 'grilled' in Portugual - do you know if it had arrived from another EU Member State or from a country outside the EU?

Thanks.

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[AndrewB]

Re: Do you know where the boat had arrived from?

That's a good point. It was a new looking yacht, and the owner definitely told me he had come from England, but come to think of he wasn't specific as to the route. It hadn't occurred to me before to question this. But on the west coast of Portugal, maybe one can understand why Customs there might be suspicious.

They asked me too there, one of only two times I have been asked to provide VAT evidence. (The other time was in Belle Ile, France). All I have is a letter from UK customs, as my yacht was in Australia on 31.12.92 and the original VAT invoice is lost. But when I said the yacht was built in 1983, and the fact that it looked its age, they waved my papers aside.

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[Birdseye]

Re: Caveat emptor!

ref vyv cox's comments on part 1 registration.

this is the core of the problem. whilst registration docs in most of the rest of the ec prove that vat has been paid and not reclaimed, they do not do so in the uk . that is why we get asked for the original vat invoice - not a copy since the original would have had to be handed in if the boat had been exported and the vat re-claimed.

to compound matters, lots of frenchmen were buying boats in the uk, exporting them to the channel islands and then re-claiming the vat. not unsurprisingly, that didnt appeal to the froggy government.

however, if a boat is sold in the uk from one uk resident to another, then its vat status is in theory the business of the uk government as the relevant tax authority. the rya told me that in their experience, the question only ever came up in the third world parts of the ec (portugal, greece) when there was a reason for the official concerned to want to be difficult - ie the yugoslav campaign (greece) or the absence of ssr, or an argument with an official or a relative / friend of an official, departing marina without paying etc. personally i have never been asked for any vat docs.

incidentally, even if you sold the boat as vat paid, knowing it to be so, the transaction has gone through and his comeback to you can surely only be if he finds that it is not vat paid. ie he has to prove that you mis represented the vat status of the boat. given the difficulty of getting the time of day out of HMCE (civil servants? more like uncivil masters) how is he going to do this? i'm no lawyer so if it gets that far you need to get proper advice, but my instinct would be to try and help as much as poss but not to worry (as yet) - his problem if indeed there is one at all.

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