Please note that this page is intended as a guide only. Customs Notice 8 'Sailing your pleasure craft to and from the United Kingdom', is a useful source of information as is Notice 728. They can be viewed or downloaded from HM Customs . We also have our own fact sheet courtesy of the RYA which we will be happy to send you by E-Mail
'ANY yacht purchased outside the EU will be liable for VAT, regardless of age or previous tax history. There may also be Import Duty unless the boat is more than 12 metres length overall, or built in the EC. Charges become due at the first port of call.' (source: HM Customs & Excise)
It is important to realise that the VAT status of a yacht can change throughout a vessels life. For example, if a yacht has been purchased in the UK VAT-paid and is then taken outside the EU to Turkey where it is eventually sold, it has LOST its original VAT-paid status. This means that VAT will again be payable on the boat if it is brought back by the new owner, who is an EU citizen, into the EU. VAT must be paid in the first port of call within the EU.
This also means that if a boat is owned by an EU citizen in a non-EU country and is VAT-unpaid, it may not be used to visit the EU even for a day unless VAT is paid on it immediately on entry to the EU.
If you are changing residence from a non-EC country to an EC country, you may import a vessel free of Customs duty and VAT if:-
- You have lived outside the EC for at least 12 months
- You have owned and used the vessel outside the EC for at least 6 months
- You did not get your boat under a duty or tax free scheme (such as the 'sailaway scheme')
- You declare the vessel to Customs on arrival in the EC
- The vessel is not lent, hired, used as security or sold in the EC for 12 months after relief is granted.
- If you fail to comply with this requirement, charges will become due The rules regarding your 'normal place of residence' (where you now live and where you have lived) are complex. If you are in any doubt, contact HM Customs & Excise or your national tax authority.
- VAT is due on the importation of goods from outside the EC. There are provisions for this VAT to be relieved when an EC VAT paid vessel returns to the EC after being outside the EC. This provision is only appropriate if the importation is undertaken by the person who exported the vessel. If an EC VAT paid vessel leaves the EC, and whilst outside the EC is sold, the new owner will,unless eligible for one of the relief's described in Notice No. 8, be liable to pay VAT if the vessel is brought back into the EC.
EC law allows pleasure craft from outside the EC to be temporarily imported into EC waters free of duty and VAT, subject to certain conditions. These conditions vary according to whether the pleasure craft has been brought to the EC for private or for commercial purposes. Breaching these conditions is an offence and, under the Customs and Excise Management Act 1979, section 124, could result in seizure of the vessel.
