- December 19, 2019 at 8:53 pm#43184
Brexit aside (for me at least) what are the pitfalls of buying a abroad boat, if any?
For example, I buy a boat from Thailand, go sailing end up back in the UK for 3 months before moving onto next destination.
I’m a UK citizen does it mean I have to pay vat immediately?
I then want to sell the boat does it have to go back to Thailand to be sold (unless I paid duties etc in the UK)
I just can’t seem to get my head round it all, from what I can see the second we sail anything into UK waters I would be liable for duty/vat without the 18month rule that would ordinarily apply to non resident.
I know obviously with brexit looming everything is up in the air but I think the same question could almost be applied to any country?
IE espa was purchased in Turkey would you have been able to take it back to the UK for any time or even sail through the EU for that matter?
Also can you re register under a UK flag if purchased elsewhere or would vat need to be paid to do that.
I appreciate any area of tax is a minefield yet boats seem to be even worse 🤷.
Hope that makes sense 😂
TIADecember 20, 2019 at 12:30 pm#43196
Yes, this is a bit of a minefield and it’s something we have experience of.
First of all you can register your boat anywhere from anywhere, so it’s possible to be based in Turkey and register the boat in the UK. Esper was registered in Delaware when we purchased her and we re-registered to London. You will not pay VAT for that.
If you enter into the EU with an ex-VAT boat I believe you are allowed 180 days, after which you would be obliged to pay VAT in the country you are in, or the next country you arrive in, so you might want to think about finding the country with the lowest VAT if you end up in this situation. You could of course nip over to Morocco and then you’d get another 180 days upon arrival in the EU.
The problems start when you enter the UK. As I understand it you would have to pay VAT immediately upon arrival.
Brexit is going to throw a spanner in the works. Who knows where that will leave us and our UK registered boats cruising around Europe? That’s about as clear as Brexit is to anyone!
@liz-cleere may have something to add to this.
Peace and fair winds!December 20, 2019 at 12:33 pm#43197
Also, VAT and boat registration are separate. That is, you could register your boat in the UK and pay your VAT in Spain. Of course that’s how it stands currently. Brexit will probably change that situation too!
Peace and fair winds!December 20, 2019 at 7:14 pm#43213December 21, 2019 at 9:55 am#43232LizAdmiral@liz-cleere
SY Esper was US flagged out of Delaware when we bought her (a tax dodge for the previous Turkish owner) so we re-registered out of London, UK, when we re-named her.
She was also bought ex-VAT, which meant we were liable for VAT every time we entered EU waters, not just UK waters. The percentage varied between countries, with various places in Spain offering the lowest amount at the time. We sailed in Greece without anyone having any interest in looking at our VAT papers, but we have never risked going to the UK on Esper. After the crash, and the problems Greece had, we left the Med, but I would have been reluctant to go back to Greece because they were looking at every which way to find money.
Brexit will (eventually/probably) mean that we will have to get Schengen visas for ourselves when/if we sail to European waters. It depends on what the UK government negotiates with the EU. I’m hoping as Brits we’ll be getting some kind of advantage, but who knows? On the plus side, they won’t be clobbering us for VAT anywhere in Europe, but again who knows? The way things are going they’ll keep a reciprocal agreement for VAT and we’ll end up having to get visas AND pay VAT!
I’d keep the boat in SE Asia if I were you and just fly back when you need to. It’s beautiful, stress-free (for foreigners), inexpensive and with an enormous sailing ground here. Our friend, @american, has a Thai-flagged vessel and I know it can present more hassle when sailing out of the country, but is not impossible. If you can re-register as a UK vessel, I would recommend it.
Peace and fair winds!December 21, 2019 at 2:13 pm#43247American McGeeNavigator@american
Speaking to your example based on my experience of buying a boat in Thailand… A couple of things I’ve come to understand which you might want to take into consideration. Take all this with a grain of salt as the regulations and procedures seem to change yearly and I’m due for my annual visit to see what’s new (and renew my registration).
First is that Thai boat registration falls into two categories: In-country (small) and International (large/shipping). As a “pleasure craft” you’ll automatically fall into the In-country (small) category. That means you’re limited to sailing within 100nm of the coast and restricted to certain waters (ie: I can sail the western coast of Thailand up to Burma and down to Malaysia).
Technically you’re not supposed to leave Thai waters with this sort of registration. But I’ve done it more than a few times with lots of smiling and acting dumb (Jamie will tell you it’s not an act). It does not matter that my boat was built in South Africa, crossed the Indian Ocean, been down to New Zealand and back… it’s not an ocean-going vessel as far as the Thai officials are concerned.
And you’re meant to renew this registration annually in person with an inspector from the local Harbor Master. This same inspector is tasked with all the annual renewals on long tails, speed boats, ferries, and the like around that region… so you hope to catch him traveling to-from one of those appointments near wherever you’ve parked your boat… so he’ll stop by and look at yours. The process and timing with this can result in rage or laughter depending on your personality type.
And you’re technically required to have a Thai-licensed skipper and engineer on the boat when it’s in use on the water. And you have to adorn it with the Thai-standard number, name, passenger/crew limit info. And you have to buy (cheap) disability/death insurance. And once assigned to a region you must always check in-out with that particular harbor master. And, and, and…
Why do all of this? For me, it’s because I leave the boat in Thailand and sail Thai waters 99% of the time. I don’t want to mess with boat-visa runs to Malaysia. And I don’t intend to go long-term sailing out of Thailand. And, probably most importantly, I am a fan of Kafka.
There are a few other challenges and benefits to being Thai flagged but I’ll leave it here for now. If you’re still interested in this route and have more questions, let me know.
Congrats, BTW on Brexit!December 21, 2019 at 3:43 pm#43248
You were doing so well with that post until the last line 😉
Peace and fair winds!December 21, 2019 at 7:07 pm#43250
Great post American thankyou I will certainly come back to you if we choose that route, haha with regards to brexit I’m glad it’s sorted in the sense of clarity of direction it’s going in. Good or bad is to be seen but certainly exciting times hence why I want out buy a boat and get away from people and bollotics 😂December 22, 2019 at 4:00 pm#43260
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