Widebeam Liveaboard thoughts

[Alan de Enfield]

6 minutes ago, pearley said:

And currently quite a few empty berths.

Yes, there was quite a lot of us left last year after the 30% increase in cost. I'd been there 10 years but no 'loyalty' reduction discussions.

That, on top of the condition of the 'system', made the decision to move back to the sea.

 

Shame as Newark is such a great location and only 30 minutes from home.

[gemmaze]

2 hours ago, Naughty Cal said:

On the rivers you can't just moor on the bank where you please. The banks are privately owned so you have to use designated visitors moorings most of which have a 48 hour time limit. Which can make winter CCing difficult depending on river conditions. 

 

Not much opportunity for "out in the country" mooring.

Ahh I see, so I would need to be on the canals, is that possible up north?

thanks for all the info by the way.

3 hours ago, magpie patrick said:

This point may have already been made but if you're going to explore the northern waterways in a wide beam stick to 57 feet length - otherwise the through route via the Rochdale and Calder & Hebble is not open to you.

 

It's often not open anyway but that's beside the point... 

ahh now that’s an interesting point, problem is unless I am mistaken in order to get zero vat status it has to be at least 60 foot in length and 12.5 wide.

[Naughty Cal]

4 minutes ago, gemmaze said:

Ahh I see, so I would need to be on the canals, is that possible up north?

thanks for all the info by the way.

ahh now that’s an interesting point, problem is unless I am mistaken in order to get zero vat status it has to be at least 60 foot in length and 12.5 wide.

Which would rule out parts of the northern system.

 

Have a look at the maps and decide where you want to cruise which will dictate your size of boat.

 

We are based on the Northern waterways on a Rivers Only licence and have a pretty good cruising range available, although we only have a diddy little boat

[magpie patrick]

7 minutes ago, gemmaze said:

 

ahh now that’s an interesting point, problem is unless I am mistaken in order to get zero vat status it has to be at least 60 foot in length and 12.5 wide.

Which is fine so long as you accept you aint going through the Calder and Hebble - and as a result perhaps not doing the Rochdale as that would mean 91 locks and 33 miles from Manchester to Sowerby Bridge only to turn round and do it all again. The Calder and Hebble is just under 20 miles of a 300+ mile borad network, but it's on one of the two cross pennine routes

 

edited to add - and anything over 62 feet won't fit through the Leeds and Liverpool either...

 

 

Edited June 10, 2020 by magpie patrick

[Alan de Enfield]

33 minutes ago, gemmaze said:

Ahh I see, so I would need to be on the canals, is that possible up north?

thanks for all the info by the way.

ahh now that’s an interesting point, problem is unless I am mistaken in order to get zero vat status it has to be at least 60 foot in length and 12.5 wide.

Ahhh - its all coming out now you want to save £30k, £40k, £50k, £60k ?+ in the price of a new-build.

 

You may save more by buying a Fat-Boat that has already taken the depreciation, there is one for sale in Newark for Offers over £300,000, I think it is 60 x 12.

It is immaculate having never been used (owner said "I don't like Red" - quote from Little Britain) and only 3 or 4 years old.

 

I took some pics of it as I was looking at the canopy mountings.

 

 

 

There is a bit more to it than you suggest - you need to have a boat built with exceptionally high Gunwales and be VERY AWARE of what you are signing with the builder.

Manufacturers are making great claims about their boats which have been subsequently found to be false - do you want to be the one who has to "stump up £30,000 in 7 days" because your builder 'got it wrong' ?

 

A few general points first:

1. The sale of any vessel is only subject to VAT if the owner is carrying on a business.
2. Boats are either standard rated (taxable at 20%) or zero-rated (taxable at 0%), sometimes referred to as ‘VAT free’.
3. VAT Exempt is different to VAT free (zero rated).
4. If nothing is said about VAT in the purchase documentation, the price includes any VAT due.
5. It is the seller’s responsibility to charge the correct amount of VAT and he has to account for it to HMRC.

Houseboats are always zero-rated. Houseboats are defined for VAT purposes as ‘boats or other floating decked structures designed or adapted for use solely as places of permanent habitation, and not having the means of, or not capable of being readily adapted for, self propulsion’.

So if your boat is classified as a houseboat and you have no means of propulsion (engine), nor any easy way of fitting one in the future, then the houseboat will be VAT-free.

What about live-aboards that are not houseboats? Well, this is an interesting topic and, in the words of HMRC, proving whether a vessel qualifies partly involves proving a negative as explained below.

This is how it works:

• A VAT-free boat is known as a ‘qualifying ship’. There are two specific legal criteria for a qualifying ship.
• The first is that the boat has not been ‘designed or adapted’ for recreation or pleasure. The fact that your boat is designed as a live-aboard and not as a ‘pleasure craft’ means that it fulfills the first condition even if you are not intending to live aboard permanently or at all.
• The second criterion relates to gross tonnage. This gross tonnage figure must be not less than 15 tons.  Gross tonnage is to be calculated as under the Merchant Shipping Acts.  Where gross tonnage has not been certified in accordance with those Acts HMRC guidance in Notice 744C (available online) sets out a modified version of that calculation for VAT purposes.

The HMRC formula for calculating gross tonnage for vessels of less than 24m in length is as follows.

L (m) x B (m) x D (m) x 0.16 (see below for HMRC definitions of L,B & D)

HMRC then go on to specifically define the D measurement for canal boats and this is measured from under the top of what we know as the gunwale to the base plate.

As an interesting example, take ‘Panache’ the widebeam boat featured on our build diary of a huge 69’ long (L) x 11″ beam (B) with a height of 46” (D).

Let’s work out the calculation by first converting the imperial measurements to metric so we have:

21.03m x 3.35m x 1.16m = 81.35 x 0.16 = 13.01 gross tons… Not a qualifying vessel.

So here’s the interesting part in order to get a boat even of this size to qualify the standard (D) measurement would need another 190mm adding giving a (D) measurement of 1.35m. See the revised calculation below:

(21.03m x 3.35m x 1.35) = 95.10 multiplied by 0.16 = 15.21 gross tons, a qualifying ship.

So here’s the bottom line…

Provided  that the boat is not designed or adapted for recreation or pleasure at the time you buy it and so long as the gross tonnage (L x W x D (from the underside of the back deck, or gunwale if no back deck) x 0.16) works out to be not less than 15 tons the supply of the boat is zero-rated so no VAT. Simple!

Many canal boat builders are now offering specially designed wide beam craft with higher gunwales that give live-aboard boaters the opportunity for VAT savings.

Misconceptions regarding VAT exempt vessels & residential usage…

There is no legal requirement that a VAT-free vessel be designed as or even used as a residence. Any conditions in HMRC’s Notice 744C (‘Ships, aircraft and associated supplies’) which go further than the statutory provisions are of no legal force. There is no legal justification for imposing an additional condition of permanent residential use.

A word of warning…

It is vital as a ‘Purchaser’ you read all the contractual documentation regarding the purchase of any vessels and in particular VAT free vessels. There’s been a case highlighted to us where a boat had been sold as ‘VAT free’ unfortunately on incorrect grounds which post sale lead to the HMRC correctly chasing the seller for the VAT which should have been charged. In this particular case the contract of sale placed the responsibility to satisfy any such VAT claim on the purchaser so they had to stump up.

Edited June 10, 2020 by Alan de Enfield

[Mike Todd]

15 hours ago, mrsmelly said:

Very true. I couldnt see down both sides of mine, I couldnt see hardly any of the nottingham Princess from the wheelhouse 82 feet by 20 feet 4 inches sixteen feet air draught and 100 tons when I was skippering it but could bring it alongside including in flood conditions with over 150 oldies onboard moving around without anyone falling over and very very rarely impacting at all.

I must have funny eyesight but I cannot see down both sides of our narrowboat, either! (Well, not at the same time)

[gemmaze]

That’s very interesting Alan and we have been watching this zero vat saga for a good few years now and how it’s changed over that time.

 

What I find interesting is 57 by 10 foot vat free boats sold not so long ago now do not meet the so called new criteria which would actually be my ideal size boat.

 

I have been looking at this company http://lmbs.co.uk/new-widebeam-boats/ but the text states “may qualify”

 

I wonder after having sailed away how HMRC chase things up, do they walk down the tow path with a tape measure and mobile weighing setup haha, I find it all baffling.

 

Narrowboats LTD tried selling me a 9 foot wide boat on zero vat stating it was old stock and built prior to the changes, on reflection I thought what stopped them selling me a 57 by 10 sailaway and just say it was old stock prior to changes haha.

 

But yes with the above in mind if the company we buy from does not assume vat liability they can whistle off.

 

 

 

 

[Alan de Enfield]

24 minutes ago, gemmaze said:

I wonder after having sailed away how HMRC chase things up,

If you have never been in business you may not be aware of how 'The VATman' operates.

We have to submit a VAT return quarterly listing our purchases and sales (both including and excluding VAT) and the VAT payable, if we are in an industry where our VAT rating on sales should be standard rate (20%) and they see that you sales figure do not 'match up to the expected' figure then further investigation is undertaken.

 

I have only once had a VAT investigation carried out when the Receipt of money against invoices did not show in the quarter they were issued. The VAT must be reported as the invoices are issued - NOT when you actually receive the payment.

 

To cut a long story short the powers of the VATman are immense, (greater than the Police) they can enter your property at any 'reasonable' time without a search warrant, they have the power of arrest & they can go back 9 years thru your paperwork and woe betide you if you have not got the 9 year old purchase receipt or sales invoice that they choose at random.

 

The manufacturers sales ledger will show what boat, at what price, with / without VAT was sold and to whom it was sold.

Most Inland waterways boat manufacturers are only producing 'single figures' boats each year (maybe just a couple or half-a-dozen) so they are not difficult to keep track of.

[gemmaze]

6 minutes ago, Alan de Enfield said:

If you have never been in business you may not be aware of how 'The VATman' operates.

We have to submit a VAT return quarterly listing our purchases and sales (both including and excluding VAT) and the VAT payable, if we are in an industry where our VAT rating on sales should be standard rate (20%) and they see that you sales figure do not 'match up to the expected' figure then further investigation is undertaken.

 

I have only once had a VAT investigation carried out when the Receipt of money against invoices did not show in the quarter they were issued. The VAT must be reported as the invoices are issued - NOT when you actually receive the payment.

 

To cut a long story short the powers of the VATman are immense, (greater than the Police) they can enter your property at any 'reasonable' time without a search warrant, they have the power of arrest & they can go back 9 years thru your paperwork and woe betide you if you have not got the 9 year old purchase receipt or sales invoice that they choose at random.

 

The manufacturers sales ledger will show what boat, at what price, with / without VAT was sold and to whom it was sold.

Most Inland waterways boat manufacturers are only producing 'single figures' boats each year (maybe just a couple or half-a-dozen) so they are not difficult to keep track of.

I hear you Alan.

 

[Alan de Enfield]

1 hour ago, gemmaze said:

Narrowboats LTD tried selling me a 9 foot wide boat on zero vat stating it was old stock

It must have been very old stock as the VAT rules came into force set out in the Value Added Tax Act 1995, Schedule 8, Group 8, Item 1 and legal note A1(a).  

 

As a result of this policy change some supplies of goods and services to the owners of such vessels may also be zero-rated by suppliers.

These include:

• repairs and maintenance of the vessel itself; this does not extend to the domestic equipment and fittings on board
• modification or conversion of the vessel itself provided that it remains a qualifying ship after modification or conversion; this does not extend to domestic equipment and fittings
• parts and equipment ordinarily installed or incorporated in the propulsion, navigation, communications or structure of a ship; this does not extend to domestic equipment and fittings

Further details can be found in Notice 744C.

Evidence of intention

In keeping with normal rules, suppliers will have to hold evidence to satisfy HMRC that the supply is entitled to zero-rating. This may be in the form of contractual or other documentary evidence. HMRC would also advise suppliers to obtain a declaration from their customers that the vessel is to be designed for use as a permanent residence and intended for such use. We would suggest that suppliers use the format set out for the Undertaking of Use in Notice 744C, adapted as necessary where the supply is one of the vessel itself. Customers should be aware that HMRC have powers to impose penalties where false documentation is used to obtain a tax advantage.

[ditchcrawler]

1 hour ago, Mike Todd said:

I must have funny eyesight but I cannot see down both sides of our narrowboat, either! (Well, not at the same time)

Drivers of steam trains had the same problem looking out of those two round forward facing windows in the cab 

[blackrose]

12 hours ago, mrsmelly said:

Yes you are correct.Narrowboats are a weird design in the world of boating and must not be taken as the norm.

 

Nice picture. Is that a Leeds - Liverpool barge? Hope that puts to bed the idea that it's only widebeam narrowboat owners who steer with a tiller and can't see down at least one side of the boat. There are lots of other examples. Not a hockey stick on sight either! ?

 

Edited June 10, 2020 by blackrose

[mrsmelly]

Indeed I think it is. Taken on the river Calder iirc so oop in Yorkshire anyway.

[blackrose]

That picture also shows how being higher up helps gain perspective and assists steering. It's why I stand on a couple of pallets.

[peterboat]

So to get back to the OP plenty of secondhand widebeam for sale, go look at them rather than buying new. It's what I did and it allowed me to buy a Johnathan Wilson shell rather than a Collingwood saleaway. Yes I did changes to the boat but it was still cheaper and easier than fitting out a full boat. 57 x 10 allows you to do the ribble link, 57 x 12 most of the northern system.  The extra 2 foot is bliss I can assure you and makes for a very comfortable life

[gemmaze]

13 minutes ago, peterboat said:

So to get back to the OP plenty of secondhand widebeam for sale, go look at them rather than buying new. It's what I did and it allowed me to buy a Johnathan Wilson shell rather than a Collingwood saleaway. Yes I did changes to the boat but it was still cheaper and easier than fitting out a full boat. 57 x 10 allows you to do the ribble link, 57 x 12 most of the northern system.  The extra 2 foot is bliss I can assure you and makes for a very comfortable life

What kind of second hand cost are you referring to Peter?

i fitted out my previous sailaway and still saved thousands.

[Alan de Enfield]

22 hours ago, gemmaze said:

Narrowboats LTD tried selling me a 9 foot wide boat on zero vat stating it was old stock

'Used' fatboat prices start at £70k and then the sky is the limit.

You will get a very nice 2nd hand one for less than the price of a sailaway.

 

Look at around £100K and the 'world is your lobster'

 

Start here for examples :

 

https://narrowboats.apolloduck.co.uk/boats-for-sale/narrow-boats/widebeam

[peterboat]

44 minutes ago, gemmaze said:

What kind of second hand cost are you referring to Peter?

i fitted out my previous sailaway and still saved thousands.

I paid 48.5I for a just over 1 year old 12 x 50 widebeam, I stretched it 7 foot fitted a wheelhouse and a refit on the stretched room all for 20k

 Afterwards it was valued 160k

[Grifter]

Mine is for sale at the moment, and seems to fit the bill. It's actually 56'1"x10'6", (which maximises the width allowed in band 2 of the new widebeam charges and still fits in the northern locks). I have cruised it extensively in the northern canals, from Liverpool to Leeds, York, Rochdale, Newark and Nottingham.

 

Apolloduck Link

3D Tour

[peterboat]

2 minutes ago, Grifter said:

Mine is for sale at the moment, and seems to fit the bill. It's actually 56'1"x10'6", (which maximises the width allowed in band 2 of the new widebeam charges and still fits in the northern locks). I have cruised it extensively in the northern canals, from Liverpool to Leeds, York, Rochdale, Newark and Nottingham.

 

Apolloduck Link

3D Tour

Looking good,  good luck with the sale 

[Alan de Enfield]

3 minutes ago, Grifter said:

Mine is for sale at the moment, and seems to fit the bill. It's actually 56'1"x10'6", (which maximises the width allowed in band 2 of the new widebeam charges and still fits in the northern locks). I have cruised it extensively in the northern canals, from Liverpool to Leeds, York, Rochdale, Newark and Nottingham.

 

Apolloduck Link

3D Tour

Look a very nice well looked after boat and well priced - you'd pay around £60k for a 'budget' lined sailaway of that size.

[mrsmelly]

1 hour ago, Grifter said:

Mine is for sale at the moment, and seems to fit the bill. It's actually 56'1"x10'6", (which maximises the width allowed in band 2 of the new widebeam charges and still fits in the northern locks). I have cruised it extensively in the northern canals, from Liverpool to Leeds, York, Rochdale, Newark and Nottingham.

 

Apolloduck Link

3D Tour

10 foot 6 inches is a great beam, after some thought thats what I bought. Plenty of cruising range oop north and could do such as the erewash were I moored for a while as 10 six is tight enough on there. If we go wide again at sometime it will be that beam again I will look for.

[Alan de Enfield]

21 minutes ago, mrsmelly said:

10 foot 6 inches is a great beam, after some thought thats what I bought. Plenty of cruising range oop north and could do such as the erewash were I moored for a while as 10 six is tight enough on there. If we go wide again at sometime it will be that beam again I will look for.

Yes - a nice size, but not much use if you are trying to avoid paying VAT.

[mrsmelly]

15 minutes ago, Alan de Enfield said:

Yes - a nice size, but not much use if you are trying to avoid paying VAT.

I am of the opinion that those trying to avoid VAT may well at some time find themselves in deep water?

[Alan de Enfield]

18 minutes ago, mrsmelly said:

I am of the opinion that those trying to avoid VAT may well at some time find themselves in deep water?

Maybe on the Northern canals & rivers, but not on a 'muddy ditch'.