Used boats, VAT and Brexit
What is the issue for UK Boat owners?
HMRC are planning to treat boats as per any other goods returning to the UK under the RGR (Returned Goods Relief) regulations.
From the end 2021, Returned Goods Relief (RGR) will only be available for goods returning to the UK within three years of export.
This could mean that UK owners whose boats have been based in the EU for more than three years will be liable to pay VAT for a second time if they want to bring their boats back home. This is still being argued over by HMRC, RYA, British Marine, etc etc.
Boats are a tiny part of the RGR issue.
Boats are not unique in this. Lots of other individuals, industries and businesses are potentially affected as all "Domestic Goods" are included in the RGR proposals. ("Domestic goods" = any items exported from the UK and then returned within three years where the exporter and importer are the same person and where goods have not been changed or have undergone any processes, with the exception of maintenance.
This rule covers millions of goods and items, not just boats, plus the issues are not concluded yet.
There still remains a lack of certainty and fundamental aspects of RGR and ‘VAT Paid Status’ are still yet to be addressed by HMRC.
Boatshed's advice is to photograph and retain as much documentation for your boat as you can. A record of the location of boats is also going to be part of any audit trail. Marina bills and yard bill copies will help. Make sure keep as many documents as you are able.
Boatshed Brokers always record information like this when we list a boat for sale and we retain a copy of all these documents for future reference.
Many boats have been listed and sold numerous times by Boatshed, so we often retain older secure copies of this type of information from previous owners and buyers, this may also help our customers in the future.
The best source of current information around Brexit is the RYA and British Marine websites.
Boatshed recommends this excellent information from the RYA.
This ongoing issues and negotiation by RYA is also good to keep an eye on.
For customers looking for specific Brexit and VAT advice please contact our support team HERE so we can advise on an individual basis if needed.