nicho
RIP
A quickie! If a secondhand boat is purchased from overseas and brought back to the UK (on which VAT has not been paid), does the purchaser pay VAT on the secondhand purchase price, or on it's price when first sold from new? Ta!
VAT question (probably daft, sorry)
- Thread starter nicho
- Start date
Whitelighter
Well-Known Member
You pay VAT and import duty (1.9%) on the invoiced purchase price of the boat that you have paid.
There is a caveat that if your price paid is obviously low then it can be revalued for tax, but I've done this twice and not had either value questioned
There is a caveat that if your price paid is obviously low then it can be revalued for tax, but I've done this twice and not had either value questioned
Tranona
Well-Known Member
The VAT is paid on the landed value. If you are buying the boat and using the purchase price as the basis then the landed price would include the shipping, duty and clearance. However, the rules allow for it being based on a value as obviously not all imports occur immediately on purchase. The boat might, for example have been used outside the EU for some time since purchase so will have depreciated, or may have had significant subsequent expenditure for example to upgrade it before sailing to Europe, so could in principle be taxed on the cost of the work as well.
If it is a recent purchase just before import it is difficult to claim the value is any different from what you paid (including shipping etc) but if going for a valuation in the absence of a receipt for purchase then you need to justify the value - professional help may then be useful.
If it is a recent purchase just before import it is difficult to claim the value is any different from what you paid (including shipping etc) but if going for a valuation in the absence of a receipt for purchase then you need to justify the value - professional help may then be useful.
nicho
RIP
Thanks guys.
superheat6k
Well-Known Member
Duty will depend upon where it is being bought from, e.g. Channel Island are 0% duty.
If you do buy abroad make sure local costs are not shown on the purchase invoice, e.g. brokers fees. Negotiate these as a separate fee / invoice with the vendor / broker, after all paying the broker does not affect the final fee the vendor receives, but there is no reason for you to pay UK VAT on the sum for a service received outside the UK - after all you don't pay UK VAT on the beer you might drink, etc.
The next question you will ask is how do you actually go about paying the UK VAT ? A question for which there is not a clear answer anywhere on online - PM me if you need help.
If you do buy abroad make sure local costs are not shown on the purchase invoice, e.g. brokers fees. Negotiate these as a separate fee / invoice with the vendor / broker, after all paying the broker does not affect the final fee the vendor receives, but there is no reason for you to pay UK VAT on the sum for a service received outside the UK - after all you don't pay UK VAT on the beer you might drink, etc.
The next question you will ask is how do you actually go about paying the UK VAT ? A question for which there is not a clear answer anywhere on online - PM me if you need help.
MapisM
Well-Known Member
Ahem. No reason aside from being a legal requirement, in this case...?
I mean, if the "landed value" Tranona mentioned works along the same principles I'm aware of (and I don't see why it should be different between EU Countries, CI being obviously an exception), any inherent costs should be included in that value.
Tranona
Well-Known Member
Don't think coming from the CI to EU would be an exception to the general rule. If you bought a boat in the CI then had £10k of work done on it before importing it, then that would be included in the value of the boat for VAT. Equally if you bought a boat privately but paid a broker or lawyer to handle the paperwork in principle that should also be included. If you bought through a broker then you have no extra costs as they are paid by the seller, not the buyer. Can't see any logical reason for then being able to deduct them. The Buyer paid £xk for the boat, independent of what the seller paid the broker for his services. VAT is not on the net sum the vendor receives - the transaction price is the value for VAT.
MapisM
Well-Known Member
Agreed.
When I said that CI is an exception, I meant assuming to import a boat from overseas to the CI, period - which is what I understood superheat6k meant in the first line of his post.
When I said that CI is an exception, I meant assuming to import a boat from overseas to the CI, period - which is what I understood superheat6k meant in the first line of his post.
theoldsalt
Well-Known Member
I imported a 42' yacht from Guernsey nearly 3 years ago. I contacted HMRC by telephone and we negotiated a market value for the purposes of paying the VAT. They did not require a copy of the purchase invoice and the value we agreed was well below the price I paid, thus saving me a considerable sum. I paid the VAT by bank transfer and shortly after received a laminated VAT receipt through the post.
So my experience was quite different from the advise given in previous posts.
So my experience was quite different from the advise given in previous posts.
nicho
RIP
Thanks. Why does anything involving tax have to be so complicated!
Truro Ex Pat
Well-Known Member
Ok I have a question if I buy a Non vat boat in Montenegro can I pay VAT in Uk if I take it to Italy and France etc before every getting any where close to the UK?
Tranona
Well-Known Member
You normally pay at the state of first entry into the EU, although think it is possible to elect to pay in the UK. Rates are very little different in different states (although higher in Greece, for example), but given the discretion allowed for establishing value on which to base VAT you may want to explore which state is likely to be lowest cost and least hassle. If you do elect a different state from your first stop, make sure you have documentation to support it, or you could find yourself being fined in addition to paying VAT - happened to a forum member last year in Italy.
Tranona
Well-Known Member
Because it is ill thought through from the start and then messed with to either close loopholes or provide incentives to encourage specific behaviours. Add to that nearly 30 different sets of legislators have translated into their local laws and then passed authority down to lower levels. Any hope of simplicity, consistency, fairness etc got lost on the way.
What woud all the lawyers, tax specialists, agents, inspectors etc have to do if it were not so. Just think of the unemployment figures.
Nick_H
Well-Known Member
Say you wanted to import a boat from the US to France, but logistically it can only be unloaded in Southampton, then I recall that you can submit a form to customs to state that it is just passing through, and you could then pay VAT and duty in France. On that basis, it seems likely that you could buy a boat in Montenegro and sail it directly to the UK through other EU states and defer the VAT payment until you reach the UK, though I certainly don't know that for sure.
Tranona, are you saying you could elect to pay VAT in the UK even if the boat was staying in France or Italy for a while, or even permanently?
Tranona
Well-Known Member
Like you, not sure of the exact conditions, but think it is possible if the boat is destined for the UK and just passing through other states. Can't see an advantage though in paying in the UK except the treasury gets the money to waste instead of it being wasted in Italy!