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Brexit Law

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Ian2019 View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Ian2019 Quote  Post ReplyReply Direct Link To This Post Posted: 08 January 2021 at 05:28
Hi a very interesting subject to and some great comments and information. However, I read an article on the RYA web site in 2019 that if your UK VAT paid boat/yacht was in the EU at midnight of the time the UK offically left the EU on Dec 31st 2019 it is regarded as EU VAT paid and can remain in the EU. Did this change?  
H385 2014 "ARLOKO" Tivat Montenegro
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colinc View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote colinc Quote  Post ReplyReply Direct Link To This Post Posted: 08 January 2021 at 10:24
Ian - short answer to your question is yes.  UK boats in EU waters at the beginning of 2021 retain EU "VAT paid" status.  Make sure you hang on to documentary evidence of that fact.  You may have to prove it to customs officers.

I've had a Hanse in the Med for the last 15 years - originally a 370 and then a 505.  I retired 3 years ago and started a life dream to live on board and sail the Med.  But last year I sold the 505 and no longer own a boat.  I decided that Brexit had made that plan impossible or at least very difficult.  I am considering getting a smaller Hanse once again and hope to return to adhoc use in the Med.

There are three levels of legislation to consider - all of which need to be overcome:-

1. Personal passports/visas.   Schengen restricts you to 90 days in rolling 180 days.  Note Schengen is not the same as the EU as many more countries are in Schengen and a few EU countries are not.  There is no Schengen visa that will allow more access than 90 in 180 however individual countries do have visas that allow more access in just that country.  More may do this to let Brits spend tourist money in those countries.  Will see how that develops.

2. Boat "passport" i.e. which flag to fly.  If you are UK resident you can UK flag a boat even if in the Med.  You can also, with a bit of difficulty, flag it in some EU countries - Malta, for example, is possible.  You may need to set up a dummy local company to do this.  There are pros and cons of each different flag.   If UK flagged you will be treated as a third country boat and many EU countries have special laws for such boats - for example in Greece you will need boat transit papers stamped in each port you go to - and special taxes.

3. VAT - most of this is covered in preceding posts in this thread.

So it was that (and Covid to a lesser extent) that made me give up my dream of living on board and sailing the Med.  So sorry Samuel and other Brexiters - that wound is still a bit sore for me.   However there are pros and cons to most things - if I do buy a boat for my 90 day in 180 use I can save paying VAT.

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Ian2019 View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Ian2019 Quote  Post ReplyReply Direct Link To This Post Posted: 08 January 2021 at 11:29
Hi Colin
Thanks for your reply however my question was not the boat in the EU at the begining of 2021 but 2020. I bought ARLOKO in Spain 2020 therefore she was in EU waters when the UK official left the EU, at 2300hrs CET 31 December 2019, I have a letter from the marina stating she was there at that time. I moved ARLOKO to Montenegro (non EU state) in the summer of 2020 and therfore she was not in EU waters at the end of the transsional period 2300CET 31 Dec 2020. So I am seeking clarity from forum members if the VAT staus is as of when the UK officially left the EU (Dec2019) or at the end of the transsional period (Dec2020)? My information regarding at the official time of UK left the EU was from the RYA website.
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colinc View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote colinc Quote  Post ReplyReply Direct Link To This Post Posted: 08 January 2021 at 11:37
Ian - my understanding is the date is start of 2021.  UK left a year earlier but transition period means for taxes etc. it is start of 2021.

But your question illustrates extra complexity to this as much of the law is unclear and subject to interpretation.  So you are never sure when you sail into a new port how the local customs officers will interpret the law.  I could give you several examples of this.

One I have read is that it depends on the flag - so all UK flagged are now not "VAT paid" irrespective of where they were end of 2019 or 2020.   That was in the FT.  But I don't think that is correct. - although one Greek port I was in said it was going to use that rule.


Edited by colinc - 08 January 2021 at 13:05
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Post Options Post Options   Thanks (1) Thanks(1)   Quote colinc Quote  Post ReplyReply Direct Link To This Post Posted: 09 January 2021 at 02:44
I've checked the above post.  Key date is start of 2021.  See: https://www.theca.org.uk/news/brexit_vat_urgent_update for the details where you don't have to be a member to read. 

Ian - for your boat you were neither in UK nor EU waters on that date.  So that article says you can return it to the EU - especially if you paid VAT in Spain.

I'm assuming your boat is UK flagged?  Is that the case?  If so you have to work out how to officially return the boat to the EU - presumably just checking in there will do it.   May complicate those future customers officer conversations - but good luck with that.




Edited by colinc - 09 January 2021 at 03:08
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Fendant Quote  Post ReplyReply Direct Link To This Post Posted: 09 January 2021 at 03:49
Colin. thanks for the interesting article.  

The 3 year trap is also applied by the EU authorities and some Swiss or Norwegan buyers fell into it. 

When they bought a EU boat from a private individual they thought that the EU VAT paid status was forever. You can not claim the VAT back in a private-private deal. Most of these yachties learned it the hard way when they sold the boat later on the international web sites as "EU paid" to EU based customers.
The customs authorities made it clear that VAT was due after 3 years based on the residual value, which was sometimes discovered by the EU buyers after the purchaseOuch.

When you buy a boat from a company you claim the VAT back, when you export it out of the EU. In this case it is clear. that the boat has the *no VAT paid" status with the 18 months rule applicable.
Frank
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Ian2019 View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Ian2019 Quote  Post ReplyReply Direct Link To This Post Posted: 14 January 2021 at 06:09
Hi Colin

Not easy to figure out what is best to do but yes ARLOKO is UK registered with UK VAT paid. I think Ill take a trip into Croatia in the next few weeks and see what the customs says there. I dont think ARLOKO will ever go back into UK waters but only into EU waters.
Cheers
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