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post #11 of 29 Old 09-29-2008
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Except, with the boat owners being CANADIAN, they may run into some complications with a US-STATE-REGISTERED boat... and having it under Canadian Flag would get rid of any of those issues. I believe the website you've pointed to is written based on a person being a US Citizen, and may not be applicable to the OP's situation.
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Originally Posted by camaraderie View Post
Actually...Mexico is one of the countries that does NOT require documentation. From Latitude38's Mexico prep advice;

"• Boat Documents — Every boat must carry current vessel documentation that proves ownership and port of registry. If your boat is not a U.S. documented vessel, you must carry state registration papers — and ideally a bill of sale and/or other proof of ownership."
Full details here:Baja Ha-Ha Cruisers Rally: Sailing from San Diego to Cabo San Lucas

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post #12 of 29 Old 09-29-2008 Thread Starter
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Quote:
Originally Posted by magnusmurphy View Post
Register in Canada as a Canadian flagged vessel with Transport Canada but if you don't bring the boat to Canada you never have to pay any duty, nor PST. The GST depends on how you finance the boat. I've done this and have friend who've owned more than one boat this way. ONLY when you bring the boat to CAnada would you need to think of the PST and the import duty if not a NAFTA vessel.

M Murphy
Thanks Murph...

That is good info..I will make a couple of calls today. Do you know what happens when it comes time to sell the boat (ie in the state where I bought it) Being that it is now registered in Canada if someone buys it in that state will they have to pay tax on it as an out of state boat.?


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post #13 of 29 Old 09-29-2008
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Being I live in the state mentioned, California, I'll give you some info on the tax and boating regs.
The sales tax, depending on area where you bought it, will range between 7.5 and 8.5%. And then if its a new boat, the State asks for a one time assessment of 8.5% property tax with 1% to follow for every year after.
But I'd check the luxuary tax with the broker befor buying..
The 1% tax, yearly, is figured on the first of January every year. The Marinas turn in a report to the state for billing.
When we purchased our boat, we took position in Oregon which has NO sales tax..
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Wink I have an answer

For future reference for those interested:

I have received an answer after countless phone calls. As the pp indicated as a CDN citizen it cannot reg in the US under US flag. It must be registered in Canada. NOTE this is different than our normal licensing which is free of cost and quite common which also provides you with a vessel identification number. Regsitering is done through Transport Canada involves a fee ($250) and allows you sail under CDN flag. There is no requirement to import to have it regsitered, just sworn affidavit. Here is the kicker...if that boat EVER comes to Canada, Canada Customs WILL consider it an attempt to import the boat (even though it may be temporary) You either have to pay all duties (if applicable) and taxes or turn around and remain outside of CDN waters. There is no exception to this. The boat can never return home with us unless a very large bill is paid this would be in addition to state taxes already paid in the state it was purchased...ouch

I think there is a previous post but I will ask here in the interest of time..if I purchase in CA do I have to pay CA tax or is there a time frame to physically remove the boat and am I allowed to return, if so is my time limited that I am allowed to remain.

Thanks again all...trying to do all my due diligence and homework which is what Dad taught..


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post #15 of 29 Old 09-30-2008
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Most states have a grace period in which you have to remove the boat from the state. It is often 30 or 90 days. However, if you normally will be keeping the boat in Californian waters, you will probably have to pay the sales tax on it... since the government may see any removal from state waters for a short period of time as one done just to avoid paying the sales tax....If they come to that conclusion, they can get pretty nasty about it...

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For future reference for those interested:

I have received an answer after countless phone calls. As the pp indicated as a CDN citizen it cannot reg in the US under US flag. It must be registered in Canada. NOTE this is different than our normal licensing which is free of cost and quite common which also provides you with a vessel identification number. Regsitering is done through Transport Canada involves a fee ($250) and allows you sail under CDN flag. There is no requirement to import to have it regsitered, just sworn affidavit. Here is the kicker...if that boat EVER comes to Canada, Canada Customs WILL consider it an attempt to import the boat (even though it may be temporary) You either have to pay all duties (if applicable) and taxes or turn around and remain outside of CDN waters. There is no exception to this. The boat can never return home with us unless a very large bill is paid this would be in addition to state taxes already paid in the state it was purchased...ouch

I think there is a previous post but I will ask here in the interest of time..if I purchase in CA do I have to pay CA tax or is there a time frame to physically remove the boat and am I allowed to return, if so is my time limited that I am allowed to remain.

Thanks again all...trying to do all my due diligence and homework which is what Dad taught..

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post #16 of 29 Old 09-30-2008
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Sab30,

As it turns out, I am a California resident. The registration of boats in Calif is through the Department of Motor Vehicles (DMV). I was hoping to find you an e-mail address for them...one that they might respond from...but that is too much to ask from a government agency. I was able to find a phone number or two:

"Technicians are available to assist you during normal business hours if you cannot find the information you seek from our website. The Department of Motor Vehicles call center business hours are Monday, Tuesday, Thursday, Friday 8am to 5pm, Pacific time and Wednesday 9am to 5pm, Pacific time. You may contact us at 1-800-777-0133, if calling outside of the United States you may contact us at 1-916-229-0370. For the hearing impaired the TTY number is 1-800-368-4327."

I have heard of people taking their boats down to Mexico for a period of time to avoid some of the taxes. I don't know all the details however.

Fair winds/following seas,

Skipper, J/36 "Zero Tolerance"
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post #17 of 29 Old 09-30-2008
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"Being that it is now registered in Canada if someone buys it in that state will they have to pay tax on it as an out of state boat.?"

I live in NY and have looked at some boats across the lake in Canada. The broker confirmed that if I buy from them and sail it home they report it as an export and it is not taxed in Canada. I would pay NY state tax as I live there and would register it there. I am sure the rules on the Canadian side are the same regardless of which province you buy in. California I am sure would be happy to take your tax money just as NY is.
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Quote:
Originally Posted by J36ZT View Post
Sab30,

As it turns out, I am a California resident. The registration of boats in Calif is through the Department of Motor Vehicles (DMV). I was hoping to find you an e-mail address for them...one that they might respond from...but that is too much to ask from a government agency. I was able to find a phone number or two:

"Technicians are available to assist you during normal business hours if you cannot find the information you seek from our website. The Department of Motor Vehicles call center business hours are Monday, Tuesday, Thursday, Friday 8am to 5pm, Pacific time and Wednesday 9am to 5pm, Pacific time. You may contact us at 1-800-777-0133, if calling outside of the United States you may contact us at 1-916-229-0370. For the hearing impaired the TTY number is 1-800-368-4327."

I have heard of people taking their boats down to Mexico for a period of time to avoid some of the taxes. I don't know all the details however.

Fair winds/following seas,

Skipper, J/36 "Zero Tolerance"
I was at the mercy of the 5 hr busy signal..thanks I will keep trying

sck - Im not sure how that works..in Canada taxes only have to be paid once..if I had proof of taxes paid in that state (eg. CA) that I planned to resell it in, I didnt think the new owner would be required to pay taxes again in that state..I dunno...


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post #19 of 29 Old 09-30-2008
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In the USA, sales tax on titled items are collected every time the item is sold. There are some exceptions to this, like if it is transferred between family members, at least in some states.

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—Cpt. Mal Reynolds, Serenity (edited)

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post #20 of 29 Old 09-30-2008
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Here's the way we looked at it:

We're Canadian and proud to sail under the Canadian flag. Why fly a foreign flag???
We bought the boat in the US and paid only GST in Canada, no duty and no PST. Yes we know that when we eventually bring the boat back to Canada, which we likely will do, those will be payable. In the meantime however we get a nice deferment. We did take the boat out of US waters to the Caribbean though and things might be different if you leave it in the US. We bought it in RI and only left six months later and nobody ever said anything about any local taxes.

I was also told that since we're Canadian citizens we cannot US flag the vessel. I have met people who flagged boats in countries they've never lived. To me that makes absolutely no sense though and I can never be proud of a flag that has no personal meaning to me. We fly our Canadian flag on our boat's stern proudly - only matched by our South African flag on the port spreader showing our heritage!

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