VAT Problems in Croatia .... again!!! This is getting beyond a joke ....

[Baggywrinkle]

Update: Result!!! .... after bombarding them with links to EU law and advice from brokers, the RYA, and various specialist boat registration companies they have conceded that if the sales contract has my German address on it and the sale is concluded in Croatia then where I choose to register the boat afterwards is irrelevant to it's status as Union Goods.

 

[Baggywrinkle]

As long as you dont want to import the boat in the uk ... leave it registered in croatia ? Croatia allows non-resident to register you just need a croatian tax number, a local agent in Croatia can do this for you.
Or does it work only for EU citizens ? Not sure..

It's registered in Germany, and unfortunately, as is often the case, when you register a boat locally in the country where the boat is kept, then you have to comply with all their laws relating to boats on their register.

New regime for vessels flying the Croatian flag: Croatia extends the boat TÜV - SeaHelp - Ihr Pannendienst auf See.

No thanks, Croatia now want's an MOT for boats registered there ....

What has changed for owners under Croatian flag? The permanent boat registration (without TÜV) has been cancelled without replacement. All those who previously had a permanent registration must now apply for regular technical inspection of their boat. If it is older than ten years, the application must be submitted by 31.12.2021. Boats between five and ten years must be submitted to the TÜV by 31.12.2023 at the latest. New boats, i.e. not older than five years, have until 31.12.2025 before the first technical inspection must take place.

I much prefer UK registration.

All those boats that were lured onto the Croatian register by the special 5% VAT regime back in 2013 when they aceeded to the EU are all now ripe for further exploitation with regular MOTs .... well I'm not playing.

 

[Zing]

Update: Result!!! .... after bombarding them with links to EU law and advice from brokers, the RYA, and various specialist boat registration companies they have conceded that if the sales contract has my German address on it and the sale is concluded in Croatia then where I choose to register the boat afterwards is irrelevant to it's status as Union Goods.

Why was it important to see your German address on the sales contract?

 

[chrishscorp]

Pootling around harbours in the UK a biannual or three yearly MOT on a boat may not be a bad thing, it would clear out some of the crap that is about, though that would mean we need a proper waste disposal stream
Sorry bit of thread drift there

 

[Baggywrinkle]

Why was it important to see your German address on the sales contract?

It must be demonstrated that it is an EU resident to EU resident sale which reinforces the VAT paid status, combined with the location of the sale (also mentioned on the contract) being in the EU. It has to be demonstrated that the sale did not occur outside the EU (and this is where the UK registration seems to cause confusion) so it's just a question of evidence of this fact.

 

[Zing]

It must be demonstrated that it is an EU resident to EU resident sale which reinforces the VAT paid status, combined with the location of the sale (also mentioned on the contract) being in the EU. It has to be demonstrated that the sale did not occur outside the EU (and this is where the UK registration seems to cause confusion) so it's just a question of evidence of this fact.

I asked because, I don't think the buyer's residence is relevant in the case of a VAT paid boat sale (non VAT paid is different and a liability could arise for an EU resident). So long as it is proven to be VAT paid and the sale is transacted in the EU then that's all that matters as to the question of reinforcing the VAT paid status. Demonstrating your residence is irrelevant to the question of where the sale is concluded. You need other proof of the transaction having been concluded in the EU.

So if a UK resident bought the boat your are buying instead of you, and the sale was documented to happen in the EU then the place of residence outside of the EU would have zero legal relevance as to the boat continuing as an EU VAT paid boat, would it not?

 

[Tranona]

I asked because, I don't think the buyer's residence is relevant in the case of a VAT paid boat sale (non VAT paid is different and a liability could arise for an EU resident). So long as it is proven to be VAT paid and the sale is transacted in the EU then that's all that matters as to the question of reinforcing the VAT paid status. Demonstrating your residence is irrelevant to the question of where the sale is concluded. You need other proof of the transaction having been concluded in the EU.

So if a UK resident bought the boat your are buying instead of you, and the sale was documented to happen in the EU then the place of residence outside of the EU would have zero legal relevance as to the boat continuing as an EU VAT paid boat, would it not?

That is indeed correct, but not worth arguing with the Croatian authorities in this case as they have already conceded that they were wrong. Not worth rubbing the salt in further.

 

[Baggywrinkle]

I asked because, I don't think the buyer's residence is relevant in the case of a VAT paid boat sale (non VAT paid is different and a liability could arise for an EU resident). So long as it is proven to be VAT paid and the sale is transacted in the EU then that's all that matters as to the question of reinforcing the VAT paid status. Demonstrating your residence is irrelevant to the question of where the sale is concluded. You need other proof of the transaction having been concluded in the EU.

So if a UK resident bought the boat your are buying instead of you, and the sale was documented to happen in the EU then the place of residence outside of the EU would have zero legal relevance as to the boat continuing as an EU VAT paid boat, would it not?

Belt and braces, for the reasons @Tranona gave. Take the win when it is offered.

 

[Hooligan]

I just had a massive result. Been in Greece since August 2021. Boat was in Italy on Brexit night. U.K. vat paid. I didn’t check in or get TL as I viewed myself as Union goods. Been a lot of issues re Transit Logs so thought time I tried to get an Unlimited TL. Got it today!!!! Btw for all of us who got T2Ls, they are not worth the paper they are written on. I have been speaking with HMRC re this TL issue and they clearly told me that the T2L is not accepted as anything official in the EU unless that country decides it will accept it. So best not rely on this in my view.

 

[Baggywrinkle]

I just had a massive result. Been in Greece since August 2021. Boat was in Italy on Brexit night. U.K. vat paid. I didn’t check in or get TL as I viewed myself as Union goods. Been a lot of issues re Transit Logs so thought time I tried to get an Unlimited TL. Got it today!!!! Btw for all of us who got T2Ls, they are not worth the paper they are written on. I have been speaking with HMRC re this TL issue and they clearly told me that the T2L is not accepted as anything official in the EU unless that country decides it will accept it. So best not rely on this in my view.

Congratulations, and good to know, I won't bother getting a T2L and will stick with the previous owners invoice with VAT on it. It was a T2L obtained by a Croatian spedition company that saved my boat sale in 2021 ... before it was produced, the Slovenian and Croatian authorities were insistent that the new Slovenian owner had to pay VAT even though I had the Croatian import document with VAT and import duties settled. It's a gift that keeps on giving - I keep getting told if I use my German citizenship and do German registration then all this goes away.

 

[Cariadco]

Not sure if this is relevant as your boat hasn’t left Croatia but re T2Ls HMRC just sent me the following advice

The Union Customs Code Implementing Regulation (EU) 2015/2447 (Article 199) details means of proving the customs status of Union goods (proof of Union status), which might include the invoice or a T2L. Whilst the UK was a member of the EU, it was possible to obtain a retrospective T2L from HMRC. According to the European Commission, documentation such as a T2L or a customs opinion letter, issued by the UK before the end of the Brexit transition period, is no longer valid in the EU. The European Commission advised that "for a boat lying in the EU at the end of the transition period, the person concerned needs to submit a new request to obtain a proof of Union status to one of the Customs authorities in the EU”.

I am focussed on the Greek shambles but sounds like Croatia as bad. I have an Irish passport and will reflag the boat in Ireland now along with many others who are doing this. In fact any U.K. citizen can do this as well under Irish rules. Apart from never having to deal with EU officials again you get another advantage. Insurance Premium Tax is lower over there so likely your premiums go down. Downside is the admin to get it done.

I note this section:
''According to the European Commission, documentation such as a T2L or a customs opinion letter, issued by the UK before the end of the Brexit transition period, is no longer valid in the EU. The European Commission advised that "for a boat lying in the EU at the end of the transition period, the person concerned needs to submit a new request to obtain a proof of Union status to one of the Customs authorities in the EU”.
So, for a new Proof of Union Status, I contacted the Greek Custom Authorities (as I am in Corfu) from your link, but none of the email's work as they are on the old system. However, they did answer the phone. They advised I go speak to the Local Custom Authorities, here at the Corfu Commercial Port, which I will in the next few days.
I have a T2L and a letter from the HMRC stating the boat is fully VAT compliant, and a letter from the Marina, stating the boat was here on the 31st December 2020.
Hope this is useful to anyone in a similar position to me, who are based in Greece.

 

[MontyMariner]

I am going to register it on the U.K. Ships Register

If you are referring to the UK SSR one of the criteria is that 'you live in the UK for at least 185 days of the year'
Register a boat
and
UK Ship Register Eligibility | UK Ship Register
I don't know how tight this is controlled.

 

[Hooligan]

I note this section:
''According to the European Commission, documentation such as a T2L or a customs opinion letter, issued by the UK before the end of the Brexit transition period, is no longer valid in the EU. The European Commission advised that "for a boat lying in the EU at the end of the transition period, the person concerned needs to submit a new request to obtain a proof of Union status to one of the Customs authorities in the EU”.
So, for a new Proof of Union Status, I contacted the Greek Custom Authorities (as I am in Corfu) from your link, but none of the email's work as they are on the old system. However, they did answer the phone. They advised I go speak to the Local Custom Authorities, here at the Corfu Commercial Port, which I will in the next few days.
I have a T2L and a letter from the HMRC stating the boat is fully VAT compliant, and a letter from the Marina, stating the boat was here on the 31st December 2020.
Hope this is useful to anyone in a similar position to me, who are based in Greece.

You should have no issues at all

 

[Baggywrinkle]

If you are referring to the UK SSR one of the criteria is that 'you live in the UK for at least 185 days of the year'
Register a boat
and
UK Ship Register Eligibility | UK Ship Register
I don't know how tight this is controlled.

I'm applying for Part 1 which means I only need a U.K representative with a U.K. address - so all is good. My experience with the UKSR so far has been overwhelminly positive and I'm about 75% of the way through the process.

I'm not eligible for SSR because, as you say, I am not U.K. resident.

 

[johng39]

You are totally correct that the flag has no impact on the VAT status, I know as I checked with RYA legal and with HMRC when purchasing last year. However, all the advice was put an EU flag on it, because people are basically getting it wrong & the issue is when you try to sell the boat to an EU national. I have a Malta registry on mine, bloody expensive, bloody painful, but I have no issue with EU VAT discussions with idiots who don't understand the implications of the flag state.

 

[Baggywrinkle]

You are totally correct that the flag has no impact on the VAT status, I know as I checked with RYA legal and with HMRC when purchasing last year. However, all the advice was put an EU flag on it, because people are basically getting it wrong & the issue is when you try to sell the boat to an EU national. I have a Malta registry on mine, bloody expensive, bloody painful, but I have no issue with EU VAT discussions with idiots who don't understand the implications of the flag state.

Ran into that problem selling my last boat which was EU VAT paid but UK flagged. It cost €27 to resolve, converting the Croatian import paperwork to a Croatian issued T2L. It was imported at zero rate VAT but the documentation surrounding this seemed to create confusion. I am also a German/UK citizen with German residence which helps.