Advice Received On Re-Entering EU With Yacht

Created by doina. Last modified on 2004-07-13 14:39:11
Topic: VAT

I am a UK citizen and my yacht is owned by a US company. I have been living aboard for the past two years, so have no permanent residence. I recently asked for advice on what options are open to me on returning to the EU as regards importing the yacht without incurring VAT and/or changing my current status of residence. I received the following reply:

REPATRIATION

Repatriation may be claimed when you move into the EU permanently, i.e. become an EU resident. To be entitled to import the yacht within the scope of the repatriation provisions, you would have to become an EU resident which is likely to trigger tax obligations.

Another issue to be borne in mind is that all goods imported under the repatriation provisions should be used privately (i.e. a yacht should not charter) and should remain in your possession for at least the first 12 months after importation. During that period, you are not allowed to "sell, lend, hire out" any of the goods you import via the repatriation route. If Customs know that a yacht is about to be imported under these provisions, they would expect the owner to meet all tax obligations as an ordinary EU resident.

TEMPORARY IMPORTATION

Non-EU residents are eligible for Temporary Importation relief. On the basis that you have a UK passport, Customs are however likely to assume that you are an EU resident and would accordingly expect the yacht to be VAT-paid. It would be hard to persuade Customs of your entitlement to TI status. This may also trigger income tax obligations.

In conclusion, it would seem that Customs may not target a US yacht that is owned by a US corporation. Therefore it is a possibility that the authorities would not be alerted to the issues, in particular to your EU links.