VAT status in EU

[JaneM]

Sorry for numpty questions, but I’d be very grateful for advice on this:
I’m considering buying a share of a yacht in Greece. She was definitely there on/pre-Brexit day. VAT status is unknown, and there is no transit log.
From what I read, can VAT paid status be assumed as she was in Greece on/pre Brexit day?
If so, is a transit log required?
Thanks

 

[Irish Rover]

I doubt anyone can give you definitive answers to your question without more information. However, assuming the yacht didn't enter Greece under Temporary Admission arrangements prior to B day, then I think it's probably safe to assume it's regarded as EU VAT paid. If however the amount you're investing in the share purchase is a significant sum you may not want to rely on assumptions.
Whether it needs a transit log may depend on the flag. If it's an EU flag then no. If it's a UK or other non EU flag then I'm not sure as the "rules" if you can call them that, or maybe more correctly the interpretation of the rules, have changed frequently. Others may be more up to date.

 

[JaneM]

I doubt anyone can give you definitive answers to your question without more information. However, assuming the yacht didn't enter Greece under Temporary Admission arrangements prior to B day, then I think it's probably safe to assume it's regarded as EU VAT paid. If however the amount you're investing in the share purchase is a significant sum you may not want to rely on assumptions.
Whether it needs a transit log may depend on the flag. If it's an EU flag then no. If it's a UK or other non EU flag then I'm not sure as the "rules" if you can call them that, or maybe more correctly the interpretation of the rules, have changed frequently. Others may be more up to date.

Thanks very much. From what I'm told, the yacht was apparently bought from her first owner Sunsail, Croatia. She is UK SSR registered

 

[Irish Rover]

Thanks very much. From what I'm told, the yacht was apparently bought from her first owner Sunsail, Croatia. She is UK SSR registered

Sunsail generally sell their yachts excluding VAT - I bought my current boat from them ex VAT last year. So this new information doesn't get us much further. Was it the current owner bought it from Sunsail or has it changed hands more than once since. From my experience Sunsail are by the book as regards contracts, bills of sale etc. I'm surprised you're not able to get a full history. Dates are important as well. Croatia joining EU 2013, UK leaving etc.

 

[Baggywrinkle]

Sunsail Croatia do sell VAT Paid owners yachts from their fleet, e.g. https://www.mooringsbrokerage.com/used-boats/2019-jeanneau-sun-odyssey-389-croatia-kinoa-9844805 , in which case there should be some paperwork from Sunsail showing VAT Paid, and if you are lucky, Sunsail may have retained copies of that paperwork. They also sell VAT unpaid yachts as @Irish Rover indicated so the new owner will either have to pay VAT, for which there should be paperwork, or if non-EU resident, have TA paperwork which means it is VAT unpaid.

I have the Croatian VAT payment paperwork for my current boat where the amount paid is indicated - Check the boats papers for invoices/sales contracts showing VAT or TA paperwork.

This is unfortunately just one part of the puzzle though, as it would have to be proved that the boat, on it's way from Croatia (where VAT was supposedly paid) to Greece, didn't leave EU waters long enough to lose VAT paid status, and that it never changed hands outside the EU.

Hopefully the previous owners can supply this information.

If not, assume it is not VAT paid and adjust the price accordingly.

I sold a UK registered EU VAT paid boat in 2021 in Croatia. The new owner was a Slovenien. Both port authorities (Croatia and Slovenia) claimed that as the boat was UK registered it was not VAT paid .... even though I had the Croatian VAT paperwork. I ended up employing a spedition company to create a T2L based on the Croatian paperwork and everyone was happy.

There is a lot of confusion regarding UK flagged boats, even with the authorities. Don't know how the Greek authorities will see this until they have a look at whatever evidence you have of VAT payment.

 

[Tranona]

Thanks very much. From what I'm told, the yacht was apparently bought from her first owner Sunsail, Croatia. She is UK SSR registered

Normally boats from charter operators are sold VAT unpaid but if it is a private buyer who is EU resident wanting to keep it in the EU VAT is charged and an invoice provided showing VAT payment. So critical that you see if there is one. However a non EU resident can buy VAT unpaid and then keep it in the EU under Temporary Admission which gives 18 months renewable. Brexit is a bit of a red herring as just being there does not necessarily make it VAT paid as it only applies to boats that were already VAT paid status, not to boats located in the EU under TA. You don't say how old the boat is or when it was bought from Sunsail, but Croatia only joined the EU in 2013 and its treatment of VAT in the transition period was a bit chaotic!

There are extra complications in Greece as it treats boats differently for Transit log purposes depending on VAT status. So important to establish status before committing. If the boat has been used in Greece for a long period of time, this suggests that the current owners will have sorted all this out and should be able to provide you with clear documentation to show that the share they are selling is usable in the way you want.

 

[Irish Rover]

Sunsail Croatia do sell VAT Paid owners yachts from their fleet, e.g. https://www.mooringsbrokerage.com/used-boats/2019-jeanneau-sun-odyssey-389-croatia-kinoa-9844805 , in which case there should be some paperwork from Sunsail showing VAT Paid, and if you are lucky, Sunsail may have retained copies of that paperwork. They also sell VAT unpaid yachts as @Irish Rover indicated so the new owner will either have to pay VAT, for which there should be paperwork, or if non-EU resident, have TA paperwork which means it is VAT unpaid.

It can even be more complicated in that they sell VAT paid boats owned by a private company, on the condition the buyer exports the boat out of the EU, so that the seller can reclaim the VAT.
As all responders have said OP needs more information.

 

[JaneM]

Sunsail generally sell their yachts excluding VAT - I bought my current boat from them ex VAT last year. So this new information doesn't get us much further. Was it the current owner bought it from Sunsail or has it changed hands more than once since. From my experience Sunsail are by the book as regards contracts, bills of sale etc. I'm surprised you're not able to get a full history. Dates are important as well. Croatia joining EU 2013, UK leaving etc.

Thanks again Irish Rover. No, it seems the existing syndicate haven't asked these questions. From what they've told me, they think the syndicate is at least the 3rd if not 4th/5th owner. They have apparently been in touch with Sunsail but no reply as yet... I'll follow up with Sunsail.

 

[JaneM]

Normally boats from charter operators are sold VAT unpaid but if it is a private buyer who is EU resident wanting to keep it in the EU VAT is charged and an invoice provided showing VAT payment. So critical that you see if there is one. However a non EU resident can buy VAT unpaid and then keep it in the EU under Temporary Admission which gives 18 months renewable. Brexit is a bit of a red herring as just being there does not necessarily make it VAT paid as it only applies to boats that were already VAT paid status, not to boats located in the EU under TA. You don't say how old the boat is or when it was bought from Sunsail, but Croatia only joined the EU in 2013 and its treatment of VAT in the transition period was a bit chaotic!

There are extra complications in Greece as it treats boats differently for Transit log purposes depending on VAT status. So important to establish status before committing. If the boat has been used in Greece for a long period of time, this suggests that the current owners will have sorted all this out and should be able to provide you with clear documentation to show that the share they are selling is usable in the way you want.

Thanks very much Tranona - yes, interesting point re Croatia. I'll chase Sunsail but suspect they no longer have bill of sale which would probably be in early 2000's

 

[Irish Rover]

Thanks very much Tranona - yes, interesting point re Croatia. I'll chase Sunsail but suspect they no longer have bill of sale which would probably be in early 2000's

If it was early 2000's it predates Croatia joining the EU so Sunsail are not going to be able to assist. You then need to establish when, and under what arrangements it entered the EU.

 

[JaneM]

If it was early 2000's it predates Croatia joining the EU so Sunsail are not going to be able to assist. You then need to establish when, and under what arrangements it entered the EU.

Thanks. Sounds as though the only hope is if any of the existing syndicate can trace former owners. Otherwise I guess I'll have to assume VAT not paid :-(

 

[Baggywrinkle]

Thanks very much Tranona - yes, interesting point re Croatia. I'll chase Sunsail but suspect they no longer have bill of sale which would probably be in early 2000's

You'd be surprised, with my last boat which was built in 1999 I wrote to Bavaria Yachts GmbH in Germany and got the original bill of sale to a leasing company in Austria, wrote to them and got the bill of sale to the Charter Company selling the boat to me, and the Charter Company I bought from obviously had a sales contract with me. This was around 2011 so the records were kept for over a decade by both companies.

Not much use though if it has been through a number of private owners and the sales contracts have been lost.

 

[JaneM]

You'd be surprised, with my last boat which was built in 1999 I wrote to Bavaria Yachts GmbH in Germany and got the original bill of sale to a leasing company in Austria, wrote to them and got the bill of sale to the Charter Company selling the boat to me, and the Charter Company I bought from obviously had a sales contract with me. This was around 2011 so the records were kept for over a decade by both companies.

Not much use though if it has been through a number of private owners and the sales contracts have been lost.

Worth a try though - I'll contact Sunsail, see if we can trace ownership. Thanks very much

 

[Tranona]

Thanks very much Tranona - yes, interesting point re Croatia. I'll chase Sunsail but suspect they no longer have bill of sale which would probably be in early 2000's

If it is that old I would be less worried about documentation and VAT payment. There are many boats in Greece from that period that have no documentation in respect of VAT and almost certainly VAT was never paid. The key thing is that it should have a transit log which presumably it has had if it is being used. Presumably the current syndicate members are happy and do not have problems using the boat. Are you buying a share in an existing syndicate or is it a new one?

 

[Irish Rover]

If it is that old I would be less worried about documentation and VAT payment. There are many boats in Greece from that period that have no documentation in respect of VAT and almost certainly VAT was never paid. The key thing is that it should have a transit log which presumably it has had if it is being used. Presumably the current syndicate members are happy and do not have problems using the boat. Are you buying a share in an existing syndicate or is it a new one?

See #1. No Transit log.

 

[Tranona]

See #1. No Transit log.

Yes, but I am asking if it has had one. Difficult to see how a boat like that can have been in Greece for so long without one. As ever without full details one has to guess a bit and ask questions. Don't think there is much point in trying to get anything from Croatia when it has been in Greece for so long and possibly changed ownership there more than once . Title is probably good based on Bills of Sale for each change of ownership so the only real question is whether it can be used legally in Greece which means a transit log (and paying cruising tax of course).

 

[Irish Rover]

Yes, but I am asking if it has had one. Difficult to see how a boat like that can have been in Greece for so long without one. As ever without full details one has to guess a bit and ask questions. Don't think there is much point in trying to get anything from Croatia when it has been in Greece for so long and possibly changed ownership there more than once . Title is probably good based on Bills of Sale for each change of ownership so the only real question is whether it can be used legally in Greece which means a transit log (and paying cruising tax of course).

Did VAT paid UK registered yachts need a transit log in Greece prior to the UK leaving the EU?

 

[Tranona]

Did VAT paid UK registered yachts need a transit log in Greece prior to the UK leaving the EU?

Yes, its predecessor the Pleasure Craft Transit Log (DPAK) which in theory should have been shown and stamped at every port! I am looking at the one for my first Bavaria from 2008 when I took it out of charter, registered it on the SSR in my name. Kept it as a souvenir when I sailed the boat back to UK. It only has 3 stamps in it for the 2 years I used it in Greece which gives you an idea how well it was policed then. Understand it is more rigorous these days particularly for non EU flagged boats.

 

[JaneM]

If it is that old I would be less worried about documentation and VAT payment. There are many boats in Greece from that period that have no documentation in respect of VAT and almost certainly VAT was never paid. The key thing is that it should have a transit log which presumably it has had if it is being used. Presumably the current syndicate members are happy and do not have problems using the boat. Are you buying a share in an existing syndicate or is it a new one?

Existing syndicate; no transit log.
Thanks everyone for all your information and suggestions; I’ll do some more digging

 

[Irish Rover]

Existing syndicate; no transit log.
Thanks everyone for all your information and suggestions; I’ll do some more digging

As I think you realise, the information you have doesn't add up. Is the boat in use? Is it registered for and paying Tepai (cruising tax)? Happy digging.