VAT Question

[JJ FL]

Hello,

I need help ...

We bought a boat berthed in France.
It has been under Swiss flag since new (2000).
The VAT was paid on it in 2005, imported into E.U in France (boat there full time).

The boat will remain in France.
BUT we will register the boat in the US (US Citizens).

Question...
When I want to re-sell the boat, will the new buyer have to re-pay VAT if it is to stay in Europe or the is VAT paid good for the life of the boat, no matter where the boat goes or is registered throughout its lifespan?


Thank you very much.
Trying to make a decision...

 

[Tranona]

Registration has nothing to do with liability for VAT. VAT only arises when the item is involved in a transaction that is deemed a "chargeable event". If you keep the boat within the EU that is VAT paid and sell it in the EU then a sale from one private individual to another is not a chargeable event. However, if you take the boat out of the EU and sell it then it is liable for VAT if it comes back into the EU - unless the person importing it can get one of the (limited) exemptions. You can take the boat out of the EU temporarily and bring it back yourself and you would not have to pay VAT and could then sell it with no further VAT liability. Make sure you have the original receipt for the VAT payment in France.

So, VAT is not a once and for all asset tax, but a transaction tax. You can find good information on VAT on the RYA website or HMRC VAT Notice No8.

BTW if you are keeping the boat in Europe you may want to reconsider registering it in the US. No advantage to do that and potentially you will be stopped and questioned more often than if you registered it in an EU country such as Belgium.

 

[JJ FL]

BTW if you are keeping the boat in Europe you may want to reconsider registering it in the US. No advantage to do that and potentially you will be stopped and questioned more often than if you registered it in an EU country such as Belgium.

Thank you very much for the answer.
The advantage for us is to not pay the annual boat tax in France.
I guess we need to weigh that savings against the potential frequent questioning by Customs.
I am hoping (maybe naively) that once we have been checked once or twice, the local Customs agents will know the boat and not bother us (that being if we stay in the same area of course).

 

[Carmel2]

The advantage for us is to not pay the annual boat tax in France.

Boat tax in Corsica is a fraction of what it is on the main land............................just saying.

 

[jordanbasset]

I could be wrong but believe if you are resident in France you can be liable for the tax. I also think country of registration does not affect the tax liability, but again could be wrong.

 

[JJ FL]

Boat tax in Corsica is a fraction of what it is on the main land............................just saying.

Good to know.
The thing is, with the boat, we bought a slip in Menton so the boat will be berthed there indefinitely.

 

[JJ FL]

I could be wrong but believe if you are resident in France you can be liable for the tax. I also think country of registration does not affect the tax liability, but again could be wrong.

Actually you are correct, the residency affects the tax liability, but I am not a French resident.
I have French and US citizenship, and I reside in the US, so I have checked on that and I am not liable for the boat tax, as long as the boat is not under French flag of course.