Californian TAX office are good people

[SimonV]

Contacted the Board of Equilization the other day with a queary about buying and becoming tax exempt. This is what the good people told me this is the email.

Hello Simon:

If you take possession of the vessel in California, or in California
territorial waters, you will owe tax on the transaction. If you want to
have an exempt sale, take possession of the vessel outside the 3-mile
limit.

Thank you for contacting the Board of Equalization's Information Center.
If you have any questions, please contact us between the hours of 8:00
a.m. and 5:00 p.m., Monday through Friday, Pacific Time. Our telephone
number is (800) 400-7115. We wish you luck in your future endeavors.
KWB

How good is that, our people would tie you up in knots and still give you an ambiguous answer.

[uspirate]

my bro just did an off shore delivery in calif. thanks for the tip!

[sailorjim99]

G'day Simon

Did you by chance ask the Federal Govt. about any tax payable?

Looks as if you are getting set to go over mate?

Jim.

[sailingdog]

LOL... please be aware that you also won't have the California court system to use if you have a problem with said transaction, since California doesn't have jurisdiciton over an international transaction.

[Gene T]

They failed to tell you that if you bring it back into the state within one year you will have to pay sales tax. You may be able to register it in another state and pass through California, but you cannot move the boat to California without paying the tax.

[SimonV]

There was more on the web site which allows the vessel up to 90 days to effect repairs to ready the vessel for transport out of the state.(this was ammended to not more thewn half of the first twelve months of ownership). The Boat will also have Oz registration this takes a couple of weeks as the Coast Guard have to cancel the registration, cost $70 Then the cancelled forms have to be sent to OZ with application for the boat to be registered as an Australian vessel prior to leaving the slip, for filling another of the requirements. This tax concession also includes new equipment that is fitted to the boat US Customs need to inspect and be informed of journey if planning to stop say San Diego as well as Mexican Authorities in San Diego. It is quite clear that when leaving the state you can stop off to rest and provision and bunker. But if you stop off and take some friends for a day trip this is deemed personal use and is frowned upon.

a. Limited Exclusions Repair, retrofit, and modification of aircraft and vessels

An aircraft or vessel is not presumed to have been purchased for use in California, and is therefore not presumed to be subject to use tax, if the aircraft or vessel is brought into this state within the first 12 months of ownership for the limited purposes of repair, retrofit, or modification, provided that no more than 25 hours of air or sailing time is logged for incidental or other use. This exclusion does not apply to vehicles.

The big test is if you are a resident of California, other wise presumption is removed.

Edit: what it does is remove the difficulties in the bill of sale requirement, It otherwise remains tax free but you have to prove the vessel is being exported. This way you only need to prove export if queried.

[dohenyboy]

Really two issues here. If you buy from a California broker, it will have to be satisfied that there is no tax payable. If tax is due and the broker does not collect it, he will be liable.
Second issue, proving to California that you removed the boat within the time frame and did not return. Keep proof of transport receipts, mooriing receipts, insurance policies that show where boat located. BOE often takes years to assess you and if you have not kept the receipts they will assess the tax