Confusion over the EU VAT status of second hand boats following Brexit has led to leading marine bodies in Europe and the UK collaborating to issue new guidance.

Vat on second hand yachts. My client seems to think that there should be no VAT charged on the sale of the boat because they didnt pay VAT on it initially but as a VAT registered business I believe they should be charging VAT on this as it is a supply of goods. One member of the crew must have a radio operators certificate of competence. The International Council of Marine Industry Associations ICOMIA European Boating Industry EBI European Boating Association EBA British Marine BM and the Royal Yachting Association RYA joined forces to.

Yachts located in UK waters at that time will lose their EU union and VAT-paid status irrespective of the nationality of the ownership of the vessel. Therefore if they return to the UK they could be hit with a second UK VAT bill. The only exception to this is when the boat.

It is important to consider the VAT status of a boat when buying or selling second-hand boats and a prospective purchaser should check this at an early stage in the negotiations. As previously reported in PBO since 1 January 2021 British ownedregistered boats are only permitted free circulation VAT paid in EU countries under specific. For EU boats proof of VAT status is also required.

The EU Commission has said that yachts located in the UK at the end of the transition period on which VAT. The general rule in the UK is that if the yacht has increased in value since the date of purchase by the seller VAT will be due on the amount by which the value has increased even if VAT was previously paid on the purchase of the yacht and has not been reclaimed. However sadly not all are so diligent which can lead to delays in a transaction at a later date.

VAT on boats when buying second-hand The Association of Brokers and Yacht Agents ABYA recommends that its members should obtain the relevant paperwork from the vendor before listing a yacht as being VAT paid. Boats built after 1 January 1985 should have had VAT paid by the first owner or importer and evidence of this should come in the form of a VAT certificate or invoice. My Client has a boat that has been used in the business for a few years.

Things are progressing but evidence is still needed. It is also very useful to have a typed sheet containing the name of the boat port of registry and the crew list. Any yachts which are UK VAT paid but have not visited the UK in over 3 years may lose their UK VAT paid status.