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Canuck Sailor
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Discussion Starter #1
Hello all - I'm considering purchasing a used boat in Europe - this specific boat simply doesn't seem to have crossed the Atlantic and is only available over there.
This boat has had the VAT paid. When I remove it from the EU, is there a refund of VAT? Does anyone know?
Thanks for your help and advice.

Wally
 

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Hello all - I'm considering purchasing a used boat in Europe - this specific boat simply doesn't seem to have crossed the Atlantic and is only available over there.
This boat has had the VAT paid. When I remove it from the EU, is there a refund of VAT? Does anyone know?
Thanks for your help and advice.

Wally
Hey Wally...funny that you wrote that as I just did that inquiry today. The broker explained that VAT could be backed out, but I would want to get confirmation from another source. Im sure it would have to be exported in a certain time frame similar to most US States. For us in Canada sailing CDN registered boats (as Canadian citizens) all taxes and any duties are due the moment it enters Canadian waters no exceptions.

Hope that helps.
 

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Super Fuzzy Moderator
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17,137 Posts
Hello all - I'm considering purchasing a used boat in Europe - this specific boat simply doesn't seem to have crossed the Atlantic and is only available over there.
This boat has had the VAT paid. When I remove it from the EU, is there a refund of VAT? Does anyone know?
Thanks for your help and advice.

Wally
From my knowledge of VAT, which is not necessarily 100% accurate re Europe to America once the VAT is paid that is the end of it. If you buy something with the express intent of export you can avoid VAT but if the object has already been registered to someone else and they have paid VAT then I don't believe you can recover it.

From my wanderings through international boat markets buying a boat in Europe and exporting to America is almost certainly going to cost you when it comes to resale, I hope you have already realised this.
 

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Canuck Sailor
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257 Posts
Discussion Starter #4
Hi Sab 30 - I know that if you're buying from a broker and removing the boat from the EU in, I think it's 3 months, the VAT is either refunded or not charged.
Hi TDW - I'm not entirely sure of what you mean when you say it will cost me on resale. Perhaps you could explain further. BTW, the boat will ultimately be registered in Canada, not the US. Don't know if that makes a difference or not.
 

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Super Fuzzy Moderator
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Hey Wally...funny that you wrote that as I just did that inquiry today. The broker explained that VAT could be backed out, but I would want to get confirmation from another source. Im sure it would have to be exported in a certain time frame similar to most US States. For us in Canada sailing CDN registered boats (as Canadian citizens) all taxes and any duties are due the moment it enters Canadian waters no exceptions.

Hope that helps.
Just to be clear...I'm thinking that it would all depend on time frame and whether boat is new or second hand.
 

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Canuck Sailor
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257 Posts
Discussion Starter #6
Boats purchased by Canadian citizens and brought here are subject to GST (federal), applicable provincial sales tax depending on what province they are registered in, and any applicable customs duty. Sadly, the only province with no sales tax is landlocked...sigh.
The best way to determine the charges is to speak to a customs broker. Not all boats will have duties owing, not sure what the breakdown is tho.
In my case, I'm solely interested in bringing an EU registered boat back here - and will the EU refund me the VAT paid when I remove the boat from their jurisdiction.
After that, there are all the Canadian issues to deal with, but that info is easy to find should I ultimately need it. My ex's brother works for Canada Customs...
 

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I'm sure you realize this, but any non-North American built boat will cost you 9.5% duty on top of all the applicable taxes... this can be a pretty big hit depending on what you're planning to spend. Under NAFTA boats built in Canada and US are duty free - a nearly 10% savings.
 

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I'm sure you realize this, but any non-North American built boat will cost you 9.5% duty on top of all the applicable taxes... this can be a pretty big hit depending on what you're planning to spend. Under NAFTA boats built in Canada and US are duty free - a nearly 10% savings.
Faster is correct it is 9.5%.

Im not sure where you are but even though Alberta is "landlocked" you can still get PST exemption if you can prove residency. A perfect example is we sold our boat to an AB resident even though the boat remained in BC although I believe it was delivered offshore..:rolleyes:

The one advantage to purchasing in Europe is that duties were most likely paid entering the US and even though they were paid you MUST pay them again when the boat enters Canada if it is not a NAFTA boat...so in essence by importing directly I feel that you save by not paying duties twice..;) assuming that VAT can also be backed out/exempted. Move to Alberta and you have it made!!! :D
 

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Canuck Sailor
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257 Posts
Discussion Starter #9
Thanks - I wasn't sure about the 9.5% - I do now own a European built boat, but duty wasn't an issue. With this one, it well could be - that would come in as a big hit, esp on top of GST/PST. Might actually make more sense to leave it registered in Europe.
I'm in Ontario, so taxes are an issue. If this deal goes ahead, will have to factor that in. That's close to $15k - ridiculous:hothead
Now I see why big boats fly flags of convenience.

Wally
 

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If you mean to import the boat (as a visitor?) and leave it registered in Europe I'm not sure that's possible.. seems to me there'll be a time limit at which point you'd have to leave the country or register in Canada.

If you mean to leave it in Europe, then that's another thing......
 

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If you mean to import the boat (as a visitor?) and leave it registered in Europe I'm not sure that's possible.. seems to me there'll be a time limit at which point you'd have to leave the country or register in Canada.

If you mean to leave it in Europe, then that's another thing......
I agree I dont think its possible. :(

We have been looking at Elans in Europe and I carry dual citizenship (CDN/UK). If we purchase boat in the UK we cant leave it there as it has to be out in 30 days. (we really dont want to leave it there anyways) If you regsiter it in the UK they are going to ask for all VAT to be paid. You can register it as CDN (for insurance financing etc) and deliver to the US without having to pay any taxes or duty (as long as you abide by each state law regarding time frames), however as soon as it hits Canadian waters all taxes and duties are due at that instant...in their words as soon as it hits CDN waters it is deemed to be "imported" and when you inform customs of the situation...well now you have a rather large bill.

I think the even bigger problem is if you leave it in non Canadian waters and for example sell it in the US when done I'm pretty sure all the state taxes would be due AS WELL AS the 9.5% import duty which would scare a potential buyer...Im thinking now to just buying a NAFTA boat to avoid a large bill ourselves or making resale difficult.
 

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I do not beleive VAT paid will be refunded to you.

It sounds to me like if you buy a car, you pay taxes. Next you want to sale that car and this car will go out of the country. Does the GST/PST you have paid get refunded to you or either the purchaser, no. Only the new tax that should apply on this new transaction can be saved.

When a buyer gets a boat in EU, he decides to pay VAT then he can uses the boat in EU waters all year long.
In case he decides not paying the VAT, then he can only use the boat for 6 months in EU waters and has to leave before the last day. If he doesn't leave, his choice is quiet simple. Drop the boat on yard, or pay VAT to get the boat on waters.

If your broker said you can be refunded, double-check and I will say triple-check. It is a huge amount of money.

Here is a site you can learn about VAT
How VAT works - Taxation and Customs Union - European Commission
 

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Canuck Sailor
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257 Posts
Discussion Starter #13
All of this complexity is making my head hurt - I need to get out sailing, lol...oh, wait, I just got back from a week in Georgian Bay! Must have been the rum making my head hurt.
So, on a French built boat costing $65,000 cdn, we're talking GST, PST and 9.5% for duty - that's a serious ouch factor when you're a cheap sailor like me.
Time to talk to an accountant....seriously though, thanks to all for the advice, it helps to know all this in advance.

Wally
 

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Nearly an Old Salt
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264 Posts
just to confirm, you CANNOT get a vat refund on a second hand boat. Basically the only person that can get a VAT refund is the person paying it in the first place, ie buying it new. SomeEU countries have a designated "sailaway" scheme where you can avoid VAT on a new boat once its being taken out of the EU within a relavtively short time.

ON a new boat you can get a VAT refund, or if done properly you dont have to pay it in the first place.

VAT isnt an asset tax , its a transaction tax., In europe VAT and second hand valuations really dont apply. The quoted price accounts for depreciation which tends to wipe out the VAT. SO a second hand boat with a 100K valuation isnt a 80K + VAT valuation, its just 100K.
 
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