VAT sitution ....

[Guest]

A friend of mine has been offered a choice of Moody's .... a) 1979 ..... b) 1985

Both are non-VAT paid boats ... so as I understand it liable for VAT if not careful !!

Both of us have tried to get proper answers from HM C&E ... but they gave waffly, non-decisive answers - basically thety couldn't help !! Great !!!!!

Now the question is what is the position and how do they calaculate the VAT if payable on either ?? Is it based on original NEW price when supplied to Channel Isles, or is it on later second-hand price sold to my mate ?? What rates etc. etc. as VAT rates changed a number of times through those years ...

Boy do we need help !!!

 

[dansar]

If you want a helpful contact at the VAT office then send me a PM. This guy helped me in June with our purchase. OK, we had to pay VAT but only on the price we paid. We now have a VAT paid status yacht and a certificate to prove it. /forums/images/graemlins/laugh.gif

David

 

[AngusMcDoon]

There used to be a HMC&E VAT leaflet called "UK Guide for Yachts" which helped in a terse way, but it's no longer a current document. Some of the boat VAT information has been incorporated into a later document, which can be found here.

There's also a bit of boat stuff in HMC&E notice 728, which can be found here.

 

[jamesjermain]

I asume your friend is either buying a boat from a British-based individual who has been operating the boat VAT free as a commercial venture or are importing it from abroad (outside the EC).

In either case VAT is due on the value of the boat at the time of purchase. Generally speaking C&E will accept the value as being the price your friend pays for her but they have the right to have the boat independently valued and/or to buy the boat at the price paid. This is to stop people issuing fraudulent receipted invoices for ridiculously low sums in order to avoid VAT.

The rate of VAT you will pay will be the rate currently applying in the country where the transaction takes place. So if the boat is lying in a high VAT location, take it to a low VAT state in order to make the transaction. If boat, buyer and seller are all in the UK, you may not be able to do this, but the UK is one of the lower VAT states anyway.

 

[Talbot]

I reckon that its totally reprehensible the way that HMCE wiggles over this, and it really angers me that the RYA are not making a big fuss over it.

 

[Guest]

Hey Talbot ....

Need answer from you ol'bean .... what beam is your cat ?? HH are asking for the may do ....

 

[Blueboatman]

As an addendum and an example ,I asked HM+C specifically about the scenario of importing a US boat into the UK. That import duty and vat are due based upon the secondhand sale price,they were absolutely clear about that .This is explained clearly in the above thread..
More interestingly perhaps ,I explained that by the time I had had refitted such a vessel and upgraded and added such equipment as quality selfsteering,sails ,liferaft etc,-in order to make a safe passage-all of this would also be arriving in the uk theoretically adding duty-liable value to the boat ,yet at the same time being now of second hand (used once) value itself . HM+C response was that all this can be worked out..
So the question remains -If you decide to import ,is it a consideration to include- Worth choosing the boat with the best inventory or buying the basic boat and then buying quality gear and adding it before arriving?
.

 

[pappaecho]

I have a letter from the Yacht VAT unit dated 1995 with regard to the above. I would like to publish same, but do not have the appropriate webspace.
In essence it says that you do not have to prove VAT paid prior to 1.1.85, so the 1979 boats would not have to prove that VAT was paid or otherwise. The 1985 boat presumably would. PM me if you want a copy

 

[jamesjermain]

They have, and do. They just don't mention it every month

 

[jamesjermain]

The 1985 date only applies to boats kept in the EC at the time. A boat exported to America before 1985 then re-imported would have to pay VAT. Even a boat built before 1985, exported after 1985 then re-imported would have to pay.

 

[David_Jersey]

[ QUOTE ]
or is it on later second-hand price sold to my mate

[/ QUOTE ]

the later second hand price.

[ QUOTE ]
What rates etc. etc. as VAT rates changed a number of times through those years

[/ QUOTE ]

the current VAT rate.

It could be argued that buying a boat from down here which is not VAT paid is a good thing (as long as this is reflected in the price), as when you import her into the UK (EU) and pay the VAT you have an original official receipt from HM VATman (or whatever they are called now /forums/images/graemlins/laugh.gif), saying something like "VAT paid of £xxxx on yacht AAAAA" - which IMHO is probably going to carry a bit more weight with any VAT bod (in the UK or EU) than waiving an 25 year old VAT invoice and a mooring receipt from 1992.

Of course I am sure that everyone who buys a boat from down here actually pays the VAT............. /forums/images/graemlins/smirk.gif

Finally I have not yet seen anything definitive about the RCD which applies to us down here (although I haven't looked very hard)......... but you might want to make sure you are comfortbale with the position.

Finally, finally............ are they in Guernsey or here in Jersey? (don't worry I have just boight a boat!) and have you had a look at them yet?

 

[avmoerbe]

Dear All,
We are looking at purchasing a German flagged boat, lying in Spain, will register it in the UK. There is no VAT certificate, the boat is from 1989. There is a lot of work to be done, so we can get it for a good price, but indeed we will do up and sell on. Can anyone confirm what's what in this case?
Many thanks.

 

[Bobobolinsky]

Get the guy, if he is private to give you a low invoice and pay the Vat. If it's a doer upper, it's cheap anyway. Pay the vat at what you buy it for and just smile. Unless of course the yard that built it can provide original documents and Vat invoice.

 

[Tranona]

Dear All,
We are looking at purchasing a German flagged boat, lying in Spain, will register it in the UK. There is no VAT certificate, the boat is from 1989. There is a lot of work to be done, so we can get it for a good price, but indeed we will do up and sell on. Can anyone confirm what's what in this case?
Many thanks.

It is irrelevant where it is "flagged" it is the status of the owner that matters. If he is a private EU resident then it is just like buying from somebody in the UK. No VAT is involved. Just get the usual documentation, particularly a Bill of Sale - use a model one from the RYA or MCA and as much back history as you can get to show it is an EU boat. However, it is most unlikely you will ever be asked for anything to do with VAT.

 

[Tranona]

A friend of mine has been offered a choice of Moody's .... a) 1979 ..... b) 1985

Both are non-VAT paid boats ... so as I understand it liable for VAT if not careful !!

Both of us have tried to get proper answers from HM C&E ... but they gave waffly, non-decisive answers - basically thety couldn't help !! Great !!!!!

Now the question is what is the position and how do they calaculate the VAT if payable on either ?? Is it based on original NEW price when supplied to Channel Isles, or is it on later second-hand price sold to my mate ?? What rates etc. etc. as VAT rates changed a number of times through those years ...

Boy do we need help !!!

Your first port of call is the RYA. Although you have some sound advice on here, particularly from James, the RYA has a whole section on its website on buying a boat and dealing with VAT (and RCD if appropriate) on imported boats. It is all in an easily accessible form so you can work out which rules apply to your specific set of circumstances. This will probably answer all your questions, but in the unlikely event it does not there are links to HMRC.

 

[davey]

VAT fiddle?

Your first port of call is the RYA. Although you have some sound advice on here, particularly from James, the RYA has a whole section on its website on buying a boat and dealing with VAT (and RCD if appropriate) on imported boats. It is all in an easily accessible form so you can work out which rules apply to your specific set of circumstances. This will probably answer all your questions, but in the unlikely event it does not there are links to HMRC.

A friend is interested in a British registered yacht being sold by a British yard. The boat looks to be twenty years old at least and was being restored by its owner. The owner died and the yacht became the property of his widow. The widow then sold the "project boat" to the boatyard probably for a lot less than it was worth. The boatyard then advertises it. Nibbles reveal that they want to charge VAT! - oh was the widow registered for VAT? - I don't think so! Nibbles also reveal that they want £150 (probably plus VAT!) to lift the boat onto a lorry or trailer. I'm inclined to tell my mate to walk away from it. According to HM Customs in such a case the yard should only charge VAT on the difference between the purchase price and selling price and I don't suppose they bought the boat for a pound! Boats are not a bargain at all when the sellers start hitting you with all these charges. As the boat is only 2 to 2.5 tonnes and 24 feet LOA these charges do seem OTT.

 

[Tranona]

This could be complicated or simple depending on the facts. No question with services like the lift - VAT is payable if the provider is VAT registered.

As to the boat. If it was still owned by the widow, you could buy it direct from her and no VAT would be involved. If it is owned by the yard, either purchased or more likely taken in lieu of storage charges, the yard will have to account for VAT when they sell it. It is completely irrelevant to you (or your mate) whether they are accounting for VAT - the only thing that matters is the price you pay - is it value to you? The only impact of VAT is on the seller as it reduces the value of the sale to him.

Think about it - when you buy a used car from the dealer, do you question the VAT? VAT is a tax on the transaction, not on the asset and a boat bought from a VAT registered trader is a chargeable event for VAT purposes.

 

[Ex-SolentBoy]

I really like this idea of resurrecting an old thread with lots of replies, then posing a new question.

 

[jwilson]

A friend of mine has been offered a choice of Moody's .... a) 1979 ..... b) 1985

Both are non-VAT paid boats ... so as I understand it liable for VAT if not careful !!

Both of us have tried to get proper answers from HM C&E ... but they gave waffly, non-decisive answers - basically thety couldn't help !! Great !!!!!

Now the question is what is the position and how do they calaculate the VAT if payable on either ?? Is it based on original NEW price when supplied to Channel Isles, or is it on later second-hand price sold to my mate ?? What rates etc. etc. as VAT rates changed a number of times through those years ...

Boy do we need help !!!

If bought recently ex VAT then HMCE will normally accept either the actual purchase price (though if clearly "dodgy" or "One Pound and other considerations" they have the right to revalue it themselves), or a surveyor's or sometimes a broker's written valuation.

When arranging to get non-VAT-paid yachts VAT paid in order to make them more saleable in the UK, and able to legally stay here to be sold, HMCE has always accepted a surveyors valuation. VAT is always at the current rate wherever the yacht is physically located when the tax is paid. Spain lower than UK, Luxembourg lower still, but tricky getting there for most yachts.

 

[digbyseadog]

vat explanation simple please

Ok I buy a new cat for 200,000.00 pounds and sail off round europe for 18 months then across to the USA then back to the UK after 3 years How much vat will I pay when I return to the UK ?

Or I buy a second hand cat for 200,000.00 pounds in the french Caribbean ?

or I buy a new cat in Malta ? is it 5.6 % vat is it legal ?

Now please be gentle with me I have spoken to customs and it was hard work and I am none the wiser they just shouted 20% and took a dim view of avoydance

I am English but born in Singapore and live in the UK and have duel nationality if required with Oz and the USA as well but never used it so far.... Any help ?
Also any tips ?