Yank requests VAT enlightenment

[Guest]

Seriously considering purchasing yacht in Europe rather than sailing or shipping mine across. If I purchase a used yacht in Europe do I pay VAT? How much is VAT? What other 'hidden' costs are there when purchasing in Europe? Would I just be better off taking mine over and dealing with the various EC regulations as I encounter them?

Finally, if I purchase an American owned yacht cruising in Europe would I need to register the sale there (and pay the VAT) or would I be able to register it in the USA and just pay the local sales tax here (6%) plus documentation fees ($250)?

Hope I haven't asked to much.

 

[extravert]

You don't pay VAT on a used boat, only a new one. I can't think of any other hidden costs in the UK at least. To us, it seems that the cost of used boats in the EU is higher than equivalent boats in the US.

If you are just visiting the EU then there is no problem bringing your American owned and American registered boat from the US to here to sail, as long as it goes back again. I expect that there is a visitor's time limit. If you are importing it permanently then it is a can of worms probably best avoided. There is EU wide legislation called the RCD which applies to all new boats sold here and also used boats imported permanently into the EU.

As for the last question, I don't know.

 

[AndrewB]

If you buy a second hand yacht in the EC, it is likely that VAT will have already been paid, and the price will reflect that. Make sure you get proof of VAT payment. There is no additional sales tax on resale (at least in the UK). You will not have to obtain temporary importation relief on such a yacht, and it could then be kept in the EC indefinitely.

If you bring your own yacht, you will get temporary importation relief for it when you first clear Customs. You are then permitted to keep it in EC for 18 months, but not to leave the yacht for any period of time, charter or sell (without further clearance).

You cannot buy a US boat currently in EC waters, without breaching the terms of its temporary importation relief. In theory both RCD and VAT would then apply. However, if you approach local customs it might be possible in the circumstances to reach an agreement about retaining the temporary importation relief.

Where the yacht is registered (flagged) is irrelevant to VAT rules. All yachts are liable that have not been granted temporary importation relief.

 

[Chris_Stannard]

Be careful when people say you do not have to pay VAT on a second hand boat. Many boats are operated exVAT as they are owned by companies and are officially for the use of the company or some such reason, which is legally acceptable. If this is the case and you buy through a reputable broker he should inform you of the status of the boat, either VAT paid of ex VAT. I do not know how honest brokers in other EU countries may be in this respect, in the UK they will usually be upfront, but this may not be the case with UK owners. The rate of VAT, or TVA in France, varies from country to country, the UK is currently 17.5% and others are higher.

If you have friends, or contacts in the area, it might pay you to register with some brokers and then get them to do the initial work of looking at boats for you to save you a wasted trip form the States. You do not say what sort of a boat you are looking for and how much you want to pay, but I guess it is a cruising boat. If you look at the boats for sale on this site I think you may find that boasts in the UK are more expensive than they are in the USA. If you have any specific questions I can help with do not hesitate to email me and I will do my best to give you an answer, but my cruising area is the English channel and Northern France so I do not know the Mediterranean or Spain.

Good Luck

Chris Stannard

 

[Guest]

thanks all for advice. a lot clearer now. yes, boat do appear to be considerably cheaper here in the states, as i can see from my internet wanderings. we have a sales tax here, probably the equivalent of VAT, but it's different in two ways; 1, it is much lower (varies state by state but it's 6% in florida), and 2, it is levied every time the boat is sold so it applies to used boats as well.

thanks again for advice.

 

[vyv_cox]

You don't enjoy the benefits of the European Parliament. If you did you would also be able to share the pleasure of paying 17 - 20% VAT to support it. Perhaps the government has yet to realise that second-hand goods are VAT exempt, but give them time....