UK owned vessels currently overseas subject to new rules post Brexit.

Owners encouraged to review timing of return to protect VAT-paid status.

Global marine transport and logistics provider Peters & May reminds UK boat owners with vessels outside the UK that as the Brexit transition period comes to an end at 11pm 31st December 2020, the rules determining boats’ VAT status will be subject to change.

The latest information available from HMRC is that from 1st January 2021 the rule that yachts must return to the UK within 3 years of having last left the UK/EU in order to be entitled to Returned Goods Relief (RGR) on duty & VAT will be strictly enforced.

‘Whether RGR is applicable will be dependent on it not having undergone any repairs whilst outside the EU that increased its value, when it last left the UK/EU and the amount of time it has been overseas, the date of its reimport into the UK and whether the place from where is it returning is inside the Customs Territory of the EU,’ says the company’s Sea Freight and Customs Manager Adam Towgood. He continues, ‘In order to claim the VAT relief element of RGR, it must also have not changed ownership since it last departed. Where a boat does not meet RGR criteria, duty and VAT will be payable to HMRC upon reimport’.

HMRC has recently announced the grant of a 12-month extension exclusively for boats that are currently within the EU, having departed the UK before 31st December 2017. These now have until 31st December 2021 to be reimported to the UK and claim RGR.

Adam continues, ‘To ensure that there is no VAT payable to HMRC on the reimportation of their boats we are urging UK boat owners to take early action. Owners need to be aware of the dates of their boats’ movements and time away from the UK and act accordingly to claim Returned Goods Relief. A summary of whether HMRC will allow a claim to RGR according to the departure and arrival dates can be found here below.

Peters & May has availability on sailing schedules from the Med which will arrive in the UK before the end of December 2020. Owners choosing Peters & May as their transport provide will benefit from the company’s experts managing the Customs clearance process on their behalf.

The Peters & May team has experience working with HMRC and understands the relevant VAT rulings. An integral part of the company’s yacht transportation service is the completion of complicated paperwork on behalf of the owner.

Adam Towgood says, ‘Navigating the import process and paperwork can be a minefield for owners not accustomed to the technicalities and governing rulings. We work closely with our customers to ensure their boat’s journey home goes smoothly and all relevant legal documentation is completed.’

Further information may be obtained from the below Table, application of Returned Goods Relief (RGR) or by visiting the HMRC website or the website of the UK’s National Governing Body for sailing, the RYA.

UK VAT paid yachts currently outside the EU
Dates of original departure from and reimport to the UK. Until 31st December 2020 From 1st January 2021
  • Departure on or before 31st December 2017
  • Returning after more than 3 years and meeting all other RGR criteria*
Returned Goods Relief (RGR) may be claimed.
No duty/VAT payable to HMRC.
RGR cannot be claimed.
Duty/VAT will be payable to HMRC.
  • Departure on or before 31st December 2017
  • Returning within 3 years and meeting all other RGR criteria*
RGR may be claimed.
No duty/VAT payable to HMRC.
N/A
  • Departure after 31st December 2017
  • Returning after more than 3 years
N/A RGR cannot be claimed.
Duty/VAT will be payable to HMRC.
  • Departure after 31st December 2017.
  • Returning within 3 years and meeting all other RGR criteria*
RGR may be claimed.
No duty/VAT payable to HMRC.
RGR may be claimed.
No duty/VAT payable to HMRC.
UK VAT paid yachts currently within the EU.
Note: A one-year extension was granted by HMRC for the return of departure before the end of transition period, which expires 11pm 31st December2020.
Dates of original departure from and reimport to the UK. Until 31st December 2020 From 1st January 2021
until 31st December 2021
From 1st January 2022
  • Departure from UK on or before 31st December 2017
  • Returning after more than 3 years and meeting all other RGR criteria*
RGR may be claimed.
No duty/VAT payable to HMRC.
RGR may be claimed.
No duty/VAT payable to HMRC.
RGR cannot be claimed.
Duty/VAT will be payable to HMRC.
  • Departure from UK on or before 31st December 2017
  • Returning within 4 years and meeting all other RGR criteria*
RGR may be claimed.
No duty/VAT payable to HMRC.
RGR may be claimed.
No duty/VAT payable to HMRC.
N/A
  • Departure from UK after 31st December 2017
  • Returning after more than 3 years
N/A RGR cannot be claimed.
Duty/VAT will be payable to HMRC.
RGR cannot be claimed.
Duty/VAT will be payable to HMRC.
  • Departure from UK after 31st December 2017
  • Returning within 3 years and meeting all other RGR criteria*
RGR may be claimed.
No duty/VAT payable to HMRC.
RGR may be claimed.
No duty/VAT payable to HMRC.
RGR may be claimed.
No duty/VAT payable to HMRC.

*please refer to HMRC website for qualifying criteria.

Further information please contact:

Adam Towgood​
Peters & May
customs@petersandmay.com

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