In order to provide answers and clarifications on VAT and customs issues post-Brexit, the International Council of Marine Industry Associations (ICOMIA), European Boating Industry (EBI), European Boating Association (EBA), British Marine (BM) and the Royal Yachting Association (RYA) decided to publish a guide on the matter for yachting companies and users.
In this guide, which has been approved and validated by the European Commission, there are key scenarios that affect boats (detailed below) on the application of VAT in different situations. These important clarifications are the result of an initiative led by the EBI together with the European Commission.
VAT issues scenario post-Brexit
Scenario
Impact on VAT Paid Status (VPS)
Scenario 1
✓ EU VAT Paid Status
The boat retained EU VPS status.
Scenario 2
✓ EU VAT Paid Status
The boat keeps its Union status and it is therefore in free circulation with EU VPS.
Scenario 4
✓ EU VAT Paid Status
According to the information provided, the boat has Union status and keeps it unless the boat is taken outside the customs territory of the Union.
Scenario 5
✓ Temporary admission
A person is established in the customs territory of the Union if he/she fulfils the conditions established in Article 5(31) UCC. If the person is not established in the customs territory of the Union, then he/she can declare the boat for temporary admission if it has non-Union customs status.
Scenario 6
EU VAT Paid Status Lost
Article 203 UCC requires evidence of a previous export to the UK. The Commission guidance indicates that, in the absence of an export declaration, evidence of the previous movement of the boat to the UK is required. If the boat has never been in EU27 it is impossible to provide evidence of movement to the UK.
Scenario 7
Documentation required
Article 203 UCC requires evidence of a previous export to the UK. The Commission guidance indicates that, in the absence of an export declaration, evidence of the previous movement of the boat to the UK is required. If the boat has never been in EU27 it is impossible to provide evidence of movement to the UK.
Scenario 8
Documentation required
It is for the Member State to decide whether the conditions for RGR is possible (Article 203 UCC) are met. Article 203 UCC requires evidence of a previous export to the UK. The Commission guidance indicates that, in the absence of an export declaration, evidence of the previous movement of the boat to the UK is required. Member State authorities must therefore assess whether that satisfactory evidence can be provided in this scenario.
With reference to the Scenarios 7 and 8 Evolution will keep you updated on the different requirements and procedures as a proof of export demanded by every member state within the EU27.
The following acronyms are used:
TPE = The time at which the transition period ended – 31 December 2020, 23:00 UTC
VPS = VAT Paid Status: i.e. in free circulation
EU28 = EU before TPE, i.e. including UK
EU27 = EU after TPE, i.e. excluding UK
GB = England / Scotland / Wales excluding Northern Ireland
TA = Temporary Admission
RGR = Returned Goods Relief
UCC = Union Customs Code
*All information believed correct at time of publishing of the above article – 9th April 2021. Evolution holds no liability for subsequent changes made to these clarifications, the future actions of the European Commission or the actions of individual EU nations ***
The Union Customs Code referred to within this document can be found here.
As the guide has been approved and validated by the European Commission, if any of the key scenarios presented in this guide are not applied in any designated EU country, there is the possibility to file formal complaints in front of the European Commission. This action may require clarification on the documentation requested.
For further assistance please contact us at customs@evolutionagents.com.
Evolution Yacht Agents is the leading-edge team of professionals dedicated to providing assured and quality support and services to yachts in Spanish waters.
A full range of superyacht specialized services includes: charter license & legal advice, TPA (Vat exemption), customs & logistics operations, provisions & interior supplies, deck & engineering supplies and crew & VIP services.