VAT Status post Brexit

[macd]

All of this is irrelevant- proof of Vat status from the UK is worthless as the UK will be a third country so just like the US. Doesn’t matter that it used to be in the EU and was when VAt was paid.

That is logical, but speculative. The difference is that the US has never been in the EU (although there's nothing to stop its citizens owning boats that are, and remain, EU VAT-paid). It's perfectly possible that there will be some sort of transitional arrangements covering the VAT issue, comparable to the ones which unified VAT status across the EU 30 years or so ago. The EU has a historic fondness for such measures.

I quite agree that the competence for a non-EU agency (HMRC) to attest to EU27 VAT status post-brexit may be improbable. But, as others have written, there's no down-side to having a T2L. At worst, it will have no value, but nor will it carry any penalty and it costs almost nothing.

 

[LadyInBed]

This is as how I see it.

Whilst having no faith in T2L as proof of payment VAT/EVA, I got one as just another string to my bow.

My boat was bought in 1984 for home completion, I have no original bill of sale docs so even it is not required, anything from HMRC that says VAT paid is fine by me

 

[nortada]

My boat was bought in 1984 for home completion, I have no original bill of sale docs so even it is not required, anything from HMRC that says VAT paid is fine by me

A T2L doesn't say VAT is paid so if your are thinking of taking your boat into the EU, it might be a good idea to contact HMRC and establish your VAT status.

 

[macd]

...it might be a good idea to contact HMRC and establish your VAT status.

...and good luck with that. It's extremely unlikely that any VAT return HMRC received even mentioned LiB's boat. VAT just isn't accounted in that way. HMRC might be persuaded to support the verity of any documents the boat might have, but I wouldn't even bank on that. And remember, always, that boat's don't actually have any "VAT status", except in a loose, conversational sense. They only experience VAT-able events. (And, yes, I'm aware that HMRC use the expression; they ought to know better.)

On the other hand, if the boat were sold within the EU27 pre-brexit to, say, a spouse, for "€1 and other considerations"...
(Being slightly mischievous there, but it's an approach I've not seen suggested elsewhere. It might well work, whatever happens with brexit arrangments. Any thoughts, Tranona?)

 

[lw395]

Several things going on here.
1) We don't know what the rules will be.
2) Different people are asking subtly different questions.

If a UK-flagged boat has been in the EU, property of a UK national who has residency rights in that EU country, it seems likely that he can sell that boat in the EU as VAT paid. As a UK national, he might also get away with importing it to the UK.
If a UK national is just visiting the EU on BDay in his UK based boat, then I'd expect he can take it home and sell it in England VAT paid. But selling it in the EU would count as importing it to the EU.
In between I'd guess there are grey areas.
I would expect the devil to be in the detail.

 

[macd]

But selling it in the EU would count as importing it to the EU.

Not if it happened before brexit.
(In which case, it's worth considering any boats originally bought in the UK but now 'resident' in the EU27 and owned by EU27 nationals. Would VAT suddenly become due on them after brexit? I suspect not.)

 

[lw395]

Not if it happened before brexit.
(In which case, it's worth considering any boats originally bought in the UK but now 'resident' in the EU27 and owned by EU27 nationals. Would VAT suddenly become due on them after brexit? I suspect not.)

It's confusing enough without you taking the second half of the paragraph then disagreeing with it if you change the first half.
While we are in the EU, yes you can sell your boat in the EU without that causing VAT to be due. Unless it's the property of a VAT registered entity I suppose!

 

[macd]

It's confusing enough without you taking the second half of the paragraph then disagreeing with it if you change the first half.
While we are in the EU, yes you can sell your boat in the EU without that causing VAT to be due. Unless it's the property of a VAT registered entity I suppose!

The point, surely, is that everything sold in the EU28 for the last several decades is VAT compliant. (Ignoring anything fiscally illegal, of course). A lot of that stuff -- £billions-worth? -- will have had its original VAT paid in the UK but now will be in the EU27. That's the point of the open market. Is it all suddenly to become non-compliant?

 

[sailaboutvic]

My question to the ones in the ( U.K. Is a third country and VAT paid on boat in the U.K. Won't count ) camp .

There must be hundreds of boats owned by other people in the EU which was originated in the U.K. Like my ex boat which I brought new in the UK and now Owned by an Italian , are you say that the VAT paid in the U.K. Won't no longer stand and these people will have to pay VAT again , as some how I can't see that .

 

[macd]

Like my ex boat which I brought new in the UK and now Owned by an Italian , are you say that the VAT paid in the U.K. Won't no longer stand and these people will have to pay VAT again , as some how I can't see that .

That precisely makes my point, Vic. It's unthinkable that the Italian who bought your boat might be billed for VAT again (unless he exported it from the EU and it then returned). So why would anyone else?

 

[Chris_Robb]

That precisely makes my point, Vic. It's unthinkable that the Italian who bought your boat might be billed for VAT again (unless he exported it from the EU and it then returned). So why
would anyone else?

As Mac says making all UK VAT payment fail would be a breech of EU LAW. Remember one thing. The owners nationality of the vessel is completely different from the rights the "good" attained on payment of Vat within the then EU.

There is some doubt about a boat outside the EU maintaining is VAT rights so belt and braces is to be in the EU on the critical date when ever that is.
Remember that built in to EU LAW is the right of EU residents to re import the vessel under the repatriation of assets even after 3 years (There may be restriction re the background. Ie. Working for many years abroad. )

So boats now in the EU whether owned or not by the 27 will retain their VAT. If any leave for more than 3 years they loose VAT excepting for residents of the EU who may be able to re import them subject to the rules.

So any vessels in the UK that want to retain their VAT should set sail forthwith to the continent or Ireland to crystallize the boats rights ( nor theirs)

 

[grumpygit]

That precisely makes my point, Vic. It's unthinkable that the Italian who bought your boat might be billed for VAT again (unless he exported it from the EU and it then returned). So why would anyone else?

I would guess when/if Brexit does happen that any proof of VAT paid into the EU pot while the UK was a member state will suffice.

A good explanation of post Brexit is on PawPaw's link on "EU commission rules on pleasure craft"

 

[Garold]

Since our yacht is currently in Greece I am following this thread with interest. Also, because she is just over three years old and the loss of vat paid status would impact the value, I hope that there is some clear govt confirmation on this matter at some point.

An interesting twist on this discussion is what happens post-Brexit, when you buy a brand new boat in the U.K. and sail it straight to Europe and keep it there.

You wouldn’t necessarily have to pay UK vat because you are sailing it outside of UK waters ( I believe that you currently have about a month to leave UK/EU waters before vat is due if say you are sailing your new boat off to the Caribbean). But after Brexit, you don’t need to go to the Caribbean.

And once the boat is based in Europe, every 18 months, the boat just needs to leave EU waters for a day, in order to restart the vat clock.

This suggestion that was put to me by a yacht broker when I asked him if he felt that Brexit would cause a slump in new U.K. boat sales. Interestingly, the conversation was over a year ago and I’ve only just remembered it after reading this thread. He was already looking at how it would impact them.

This is the type of scenario that is more likely to prompt the EU to look into the status of yachts post Brexit, because the current rules could put them at a disadvantage with new yacht sales.

Garold.

Ps. Perhaps also, after Brexit, if a U.K. resident, bought a boat in the EU that was not vat paid, it looks like they could keep it in EU waters without ever having to pay the vat, so long as they leave EU waters every 18 months.

 

[grumpygit]

Would by putting the boat ashore technically put it "In Bond" alter it's criteria?

 

[sailaboutvic]

To be honesty guys I think this thread and others just like it is no more then more scare monging the same stuff that got us all in this mess in the first place .
With the kind of money involved that UK boatie spend in the EU , what they going to do kick us all out .
My gut feeling is this will all come to nothing and some thing will be sorted , And if not , we find a way around it .

 

[Irish Rover]

To be honesty guys I think this thread and others just like it is no more then more scare monging the same stuff that got us all in this mess in the first place .
With the kind of money involved that UK boatie spend in the EU , what they going to do kick us all out .
My gut feeling is this will all come to nothing and some thing will be sorted , And if not , we find a way around it .

I agree there's been too much scare mongering about this issue. Having to obtain a transit log, if that's what happens, is not going to cause any major inconvenience to cruisers. The boat can stay for 18 months and only needs to leave for a day to reset the clock. he most likely source of inconvenience will be personal visa limits on duration of stay of the owners/crew [I suppose I'm scare mongering as well now :redface-new: ]

 

[dunedin]

I agree there's been too much scare mongering about this issue. Having to obtain a transit log, if that's what happens, is not going to cause any major inconvenience to cruisers. The boat can stay for 18 months and only needs to leave for a day to reset the clock. he most likely source of inconvenience will be personal visa limits on duration of stay of the owners/crew [I suppose I'm scare mongering as well now :redface-new: ]

Separate points, not related to the VAT status of the boat.
The reason people are raising questions is the VAT value can be a substantial amount if money.
And VAT rules are not likely to be determined by local marinas and harbours desire to maintain British yachtsman. There is a huge gap in the influence and decision making paths between harbours and central EU VAT policy making.

 

[Irish Rover]

Separate points, not related to the VAT status of the boat.
The reason people are raising questions is the VAT value can be a substantial amount if money.
And VAT rules are not likely to be determined by local marinas and harbours desire to maintain British yachtsman. There is a huge gap in the influence and decision making paths between harbours and central EU VAT policy making.

I was responding to Vic’s “kick us out” rhetoricical question? I appreciate the point about value but I can’t envisage a situation where a VAT paid boat will not retain VAT paid status either in the UK or the EU or possibly both. If it’s only in the UK then I’d imagine EU boats sold into the UK after B day would have to pay UK VAT making UK boats more attractive in the UK market. All speculation of course but whatever happens there will be pluses as well as minuses and it won’t be the big disaster being predicted by some.

 

[sailaboutvic]

Separate points, not related to the VAT status of the boat.
The reason people are raising questions is the VAT value can be a substantial amount if money.
And VAT rules are not likely to be determined by local marinas and harbours desire to maintain British yachtsman. There is a huge gap in the influence and decision making paths between harbours and central EU VAT policy making.

Read my posting #49 , I really can't see anything like that happening , for the reason given in my posting , there just too Many boats owned by other member in the EU 27 that started off as UK boats , three boats I sold in the pass ended up one in Italy one on Holland and one in Germany all started off with vat paid in the U.K.
Let's say France decided to leave , is anyone going to tell me thousands of Jen Dufour owner will be liable to pay VAT for a second time .
We all need to chill and start looking forward to a new sailing season and let the idiot that we voted in sort out the mess .

 

[macd]

A good explanation of post Brexit is on PawPaw's link on "EU commission rules on pleasure craft"

It's handy that a precis of two elements is available in one place. The information therein (and much more) has been freely available for aeons and has been the basis for informed comment on these forums for a similar length of time. That hasn't stopped ill-informed flights of fancy, as this thread demonstrates.