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  1. #1
    Join Date
    Apr 2009
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    1,723

    Default Brexit VAT Issues

    I was all set to single hand across to Cherbourg, in the even of a no-deal exit on 29 March.

    VAT and Brexit will not be a problem for UK sailors who are resident in the UK -- you get 18 months every time you enter (temporary importation), and can reset the clock with one day in non-EU waters.

    The problems start if you are EU resident, whatever is your citizenship. EU residents are not allowed to use non-EU-VAT-paid boats. And can you be sure that you will never become EU resident in the future, say at retirement? Even having EU residents on board can create a legal problem, with a non-EU-VAT-paid boat.

    The RYA has been trying to get something worked into the Withdrawal Agreement, which states that Union goods remain Union goods after Brexit, but so far apparently there is no such agreement. It seems conceivable that your boat will become either Union or UK goods with either Union or UK VAT-paid status, depending on where it is physically located on the day of Brexit, or the end of the transition period, or something.

    https://www.rya.org.uk/knowledge-adv...es/Brexit.aspx

    https://www.rya.org.uk/SiteCollectio...e-Summer18.pdf

    https://assets.publishing.service.go...pean_Union.pdf

    What a mess! I was supposed to have my boat out of the water during April for maintenance, but now I'm thinking I'd better not do that, in case I need to make a quick dash across the Channel.

    Anyone have any better understanding of any of this?

  2. #2
    Join Date
    Mar 2002
    Location
    Greenwich
    Posts
    7,180

    Default Re: Brexit VAT Issues

    Quote Originally Posted by Dockhead View Post
    I was all set to single hand across to Cherbourg, in the even of a no-deal exit on 29 March.

    VAT and Brexit will not be a problem for UK sailors who are resident in the UK -- you get 18 months every time you enter (temporary importation), and can reset the clock with one day in non-EU waters.

    The problems start if you are EU resident, whatever is your citizenship. EU residents are not allowed to use non-EU-VAT-paid boats. And can you be sure that you will never become EU resident in the future, say at retirement? Even having EU residents on board can create a legal problem, with a non-EU-VAT-paid boat.

    The RYA has been trying to get something worked into the Withdrawal Agreement, which states that Union goods remain Union goods after Brexit, but so far apparently there is no such agreement. It seems conceivable that your boat will become either Union or UK goods with either Union or UK VAT-paid status, depending on where it is physically located on the day of Brexit, or the end of the transition period, or something.

    https://www.rya.org.uk/knowledge-adv...es/Brexit.aspx

    https://www.rya.org.uk/SiteCollectio...e-Summer18.pdf

    https://assets.publishing.service.go...pean_Union.pdf

    What a mess! I was supposed to have my boat out of the water during April for maintenance, but now I'm thinking I'd better not do that, in case I need to make a quick dash across the Channel.

    Anyone have any better understanding of any of this?
    Why would you do a quick dash across the channel unless you wanted to permanently keep your boat in the EU and just visit the UK afterwards? For us it’s simple - we keep our boat in the EU and will cope with being unable to have it in the UK for more than 18 months. The worst affected I guess would be those who have a UK boat that they plan eventually to retire on to the Med. Nobody does the same the other way.

  3. #3
    Join Date
    Jan 2004
    Location
    Bricks & mortar: Italy. Boat: Aegean
    Posts
    10,430

    Default Re: Brexit VAT Issues

    Quote Originally Posted by RupertW View Post
    For us it’s simple - we keep our boat in the EU and will cope with being unable to have it in the UK for more than 18 months.
    Perhaps not so simple if you're UK resident at the time. Temporary Importation is expressly not available to residents. A UK resident may be able to bring a boat in from the EU27 (or anywhere else) tax-free as 'returning goods' (if it is indeed returning). Still a murky area.
    Last edited by macd; 22-03-19 at 13:42.
    All epigrams are false

  4. #4
    Join Date
    Apr 2009
    Posts
    1,723

    Default Re: Brexit VAT Issues

    Quote Originally Posted by RupertW View Post
    Why would you do a quick dash across the channel unless you wanted to permanently keep your boat in the EU and just visit the UK afterwards? For us it’s simple - we keep our boat in the EU and will cope with being unable to have it in the UK for more than 18 months. The worst affected I guess would be those who have a UK boat that they plan eventually to retire on to the Med. Nobody does the same the other way.
    Well, here's my thinking, which is based on a little knowledge and a lot of speculation:

    I am not UK resident and don't plan to become such (although you never know -- life is long, or can be).

    However, I do hold an EU residence permit. Although I am not TAX resident so probably not subject to these rules, I wouldn't want to face some nasty Belgian jobsworth on a mission, without a document which shows that my boat was "exported" to the EU while it could be done without any formalities (prior to Brexit or perhaps, the transition period).

    Such a document should be more or less proof against problems in the EU.

    So what about the UK? I just doubt that the UK is going to yank the UK-VAT-paid status of every UK flag boat which is physically in Europe on the day of Brexit. How would they even know, even if they were politically dumb enough to do such a nasty thing?

    So my reasoning is that by being in EU waters on the day of Brexit, I'll have a document (Cherbourg marina receipt) which should satisfy Europeans, even if I have European residents on board, and that I'm unlikely to need to even discuss where the boat was, with UK authorities, so best of both worlds.


    Note to those of you with designs on Med cruising -- unless the final Brexit deal provides otherwise, your UK boat may not be used even with EU residents on board, even if the owner himself is not EU resident. And if you become EU resident, you won't be able to use your boat at all in EU waters. And count on getting checked frequently, wearing the Red Duster. This could be a very sticky business indeed.

    I just don't think that the opposite situation would be a problem. If anyone ever asks, you just don't show the Cherbourg marina receipt. But I've never been asked to show a VAT document, not once, in tens of thousands of miles over 10 years of cruising UK waters, from Land's End to the Orkneys. If you are wearing the Red Duster and are UK registered, and for goodness sake if it's a UK built boat which has never been registered outside the UK, I just can't imagine what kind of problem there could be. But as I said, I'm speculating, so will be very grateful to hear from anyone with deeper knowledge.

  5. #5
    Join Date
    Aug 2004
    Location
    Gosport
    Posts
    3,023

    Default Re: Brexit VAT Issues

    Looks like the plan for a dash across the channel needs to slip sideways a couple of weeks. May know more on Tuesday, but its difficult to keep up.

    Pete
    Moody 31

  6. #6
    Join Date
    May 2007
    Posts
    36,222

    Default Re: Brexit VAT Issues

    I don't think visiting Cherbourg at the magic hour counts for anything at all.
    What will matter is where the boat is ordinarily based, to whom it belongs, where it is registered. Maybe other factors. People with genuine dual citizenship may even get to choose.
    There will be a Brittany Ferry mid channel at slinging out time. That will remain EU VAT paid I suspect.

  7. #7
    Join Date
    Jan 2004
    Location
    Bricks & mortar: Italy. Boat: Aegean
    Posts
    10,430

    Default Re: Brexit VAT Issues

    Quote Originally Posted by lw395 View Post
    I don't think visiting Cherbourg at the magic hour counts for anything at all...
    If that's simply based on a judgment that such a test would be rather arbitrary and even unfair, I suggest you reflect on the conditions met by boats deemed VAT-paid back in '92. Just as quixotic but exactly comparable.
    All epigrams are false

  8. #8
    Join Date
    May 2007
    Posts
    36,222

    Default Re: Brexit VAT Issues

    Quote Originally Posted by macd View Post
    If that's simply based on a judgment that such a test would be rather arbitrary and even unfair, I suggest you reflect on the conditions met by boats deemed VAT-paid back in '92. Just as quixotic but exactly comparable.
    Not really.

  9. #9
    Join Date
    Jan 2004
    Location
    Bricks & mortar: Italy. Boat: Aegean
    Posts
    10,430

    Default Re: Brexit VAT Issues

    Quote Originally Posted by lw395 View Post
    Not really.
    Not really to which bit?
    You "don't think visiting Cherbourg at the magic hour counts for anything at all", yet give no reason for such a thought. Tea leaves? Magic mushrooms? Or something a little more rational?
    All epigrams are false

  10. #10
    Join Date
    Jan 2004
    Location
    Med
    Posts
    5,691

    Default Re: Brexit VAT Issues

    Quote Originally Posted by macd View Post
    Not really to which bit?
    You "don't think visiting Cherbourg at the magic hour counts for anything at all", yet give no reason for such a thought. Tea leaves? Magic mushrooms? Or something a little more rational?
    Your on form this morning Mac
    Warning forumite dyslexia near by
    www.bluewatersailorcroatia.webs.com

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