Are NB subject to Tax?

[Jackster]

Hi, house sale has been agreed, search starts in earnest! Looking at Apollo Duck some prices have tax included some tax exempt. Can anyone clarify please?

 

[MtB]

Looking at Apollo Duck some prices have tax included some tax exempt. Can anyone clarify please?

 

 

Not something I've ever noticed. Can you give an example?

 

MtB

[Guest]

Hi, house sale has been agreed, search starts in earnest! Looking at Apollo Duck some prices have tax included some tax exempt. Can anyone clarify please?

 

 

Some wide beams are VAT exempt if they are to be be your main residence on the basis you don't pay VAT when you buy a house.

 

There are other things to consider too -

 

the best link I can find is this one -

 

http://pendle-narrowboats.com/vat-on-widebeam-boats/

Edited December 9, 2012 by The Dog House

[bargemast]

As you can read on the Pendle-website of which Martin just gave you the link, the answer is NO, you won't be able to make the sizes of a NB : L x B x H big enough to comply.

 

Peter.

[ditchcrawler]

As we don't really know what the OP is looking at, it could be that he has found some new boats that are demonstrators or whatever and the VAT has already been paid. Just like the first owner pays the VAT on a new car.

I could of course be completely wrong as usual.

[bargemast]

As we don't really know what the OP is looking at, it could be that he has found some new boats that are demonstrators or whatever and the VAT has already been paid. Just like the first owner pays the VAT on a new car.

I could of course be completely wrong as usual.

 

 

Yes ditchcrawler, you are absolutely right, it's not clear from the OP's message if he's interested in a new, or secondhand boat, so the VAT question can really only be answered if we know what he's going to look for.

 

Peter.

[brian1042]

The OP seems to be asking why some boats are advertised as being VAT-exempt and others are not. For example:

http://barges.apolloduck.co.uk/feature.phtml?id=122929

and

http://barges.apolloduck.co.uk/image.phtml?id=141338ℑ=1

and

http://barges.apolloduck.co.uk/feature.phtml?id=159838

 

I have come across some very complicated explanations on various sites.

 

The main reasoning for exemption, as suggested in an earlier post, appears to be using the boat as sole residence.

Edited December 9, 2012 by brian1042

[Ray]

Presumably if you buy privately with no third party involved then you're unlikely to pay tax.

 

If you buy through an agent who is acting on behalf of a seller, whilst the seller may have to pay VAT (if the agent is registered) on the service that the agent provides, I'd be surprised if you'd have to pay VAT on the boat itself as the boat is still in private hands.

 

However, if you buy from a trader (who is VAT registered) you may well have to pay VAT subject to previously mentioned conditions when you may be exempt.

 

I'm not aware of the tax situation with a sailaway but I'd guess that a complete new boat would be a VATable item.

 

I stand (and sit) to be corrected.

[Jackster]

Sorry I was not very clear, I am looking at second hand boats and was slightly confused to see some advertised as

 

including tax

 

Apollo duck ad id 283741

 

283609

 

and some tax exempt 264578

 

264497

 

Not sure if I am missing something?

[ditchcrawler]

The OP seems to be asking why some boats are advertised as being VAT-exempt and others are not. For example:

http://barges.apolloduck.co.uk/feature.phtml?id=122929

and

http://barges.apolloduck.co.uk/image.phtml?id=141338ℑ=1

and

http://barges.apolloduck.co.uk/feature.phtml?id=159838

 

I have come across some very complicated explanations on various sites.

 

The main reasoning for exemption, as suggested in an earlier post, appears to be using the boat as sole residence.

He woun't get that up the South Oxford

[by'eck]

Apart from the permanent house boat exemption its possible that any commercial vehicle (van, boat, plane) has had the purchase VAT reclaimed through the VAT registered purchasing company.

 

When such an asset is sold on to another VAT registered company the relevant price is the VAT exclusive one since VAT will effectively be reclaimed again through input/output tax. For this reason a VAT free selling price may be shown, although it would have to be added in a private sale, or to non-VAT registered company, within the EU.

 

I can't see this happening with a narrowboat though, although possible.

[brian1042]

Sorry I was not very clear, I am looking at second hand boats and was slightly confused to see some advertised as

 

including tax

 

Apollo duck ad id 283741

 

283609

 

and some tax exempt 264578

 

264497

 

Not sure if I am missing something?

 

There are some very complicated explanations about this on the net.

 

One explanation is about the boat being used as sole residence. Another relates to boats being bought outside the EU.

 

As far as I can tell, the key thing is this:

2.CHECKING VAT STATUS:

It is important to check the VAT status of the boat before you proceed with your purchase. If the Vendor is not able to provide the original VAT receipted invoice or evidence that the boat is VAT exempt and you decide to proceed with the purchase, you may be potentially liable for VAT on the boat which is based on the current value of the boat. The rates of VAT can differ considerably in the EU states. This could potentially saddle you with a huge financial liability and it is therefore imperative that you raise the issue of the boats VAT status early on in your negotiations with the Vendor.

http://www.kikila.nl/html/vat.html

 

Apparently the RYA has a lot of info on VAT and boats.

Edited December 9, 2012 by brian1042

[by'eck]

Sorry I was not very clear, I am looking at second hand boats and was slightly confused to see some advertised as

 

including tax

 

Apollo duck ad id 283741

 

283609

 

and some tax exempt 264578

 

264497

 

Not sure if I am missing something?

 

I see your dilemma. As none of the boats you refer to appear to be of a size/type that may fit the VAT exemption category, can I suggest that the VAT exempt status in the listings (rightly or wrongly) simply means there would be no new VAT element in a potential sale. This because VAT was paid at some point previously.

 

I haven't sold through Apollo but I imagine there is a tax status question to be answered when listing a sale, for the reasons I mentioned in my previous post. Some may give an ambiguous answer.

Edited December 9, 2012 by by'eck

[Grace and Favour]

Now - I'm no expert on VAT - - but I think you may possibly find that if a second-hand boat is owned by/being sold on behalf of a VAT registered business, then the boat will be subject to VAT.

 

However, if the boat is being sold by, or on behalf of, an individual, or business that is not subject to VAT, then the boat 'should' be VAT free

 

 

(I believe that similarly if you were to buy a second-hand car from a car dealership - they will charge VAT, whereas if you buy on a 'personal' basis, there aint)

 

 

 

 

 

 

(I now wait for someone more clued up on VAT than me to correct me)

[brian1042]

Error

Edited December 9, 2012 by brian1042

[Tam & Di]

Now - I'm no expert on VAT - - but I think you may possibly find that if a second-hand boat is owned by/being sold on behalf of a VAT registered business, then the boat will be subject to VAT.

 

However, if the boat is being sold by, or on behalf of, an individual, or business that is not subject to VAT, then the boat 'should' be VAT free

 

On the other hand the commission itself can attract VAT if the broker's business exceeds the VAT threshold and he is therefore registered.

[Ange]

Now - I'm no expert on VAT - - but I think you may possibly find that if a second-hand boat is owned by/being sold on behalf of a VAT registered business, then the boat will be subject to VAT.

 

However, if the boat is being sold by, or on behalf of, an individual, or business that is not subject to VAT, then the boat 'should' be VAT free

 

 

(I believe that similarly if you were to buy a second-hand car from a car dealership - they will charge VAT, whereas if you buy on a 'personal' basis, there aint)

 

 

 

 

 

 

(I now wait for someone more clued up on VAT than me to correct me)

 

VAT margin scheme for second hand goods

 

Basically you only pay VAT on the profit element - the gross profit is treated as VAT inclusive and the VAT due to HMRC is calculated using the VAT fraction. If you make a loss no VAT is due.

[Duchess Omnium]

Grace and Favour is right. If I sell my boat to you there is no VAT involved, because I don't ordinarily sell things and I am not registered. I have no idea what happens if you buy a boat from a VAT registered business like a broker. But that could explain the difference you have noted.

 

But of anyone does tell you that a purchase is subject to VAT they MUST supply you with a VAT reg number on the invoice, which you can use to check.

[MtB]

Grace and Favour is right. If I sell my boat to you there is no VAT involved, because I don't ordinarily sell things and I am not registered. I have no idea what happens if you buy a boat from a VAT registered business like a broker. But that could explain the difference you have noted.

 

Now I'm intrigued. What about if I sell someone my boat? I am personally VAT registered but I don't sell boats by way of trade. I imagine I don't have to charge VAT, but I don't know for sure.

 

MtB

[John V]

Now I'm intrigued. What about if I sell someone my boat? I am personally VAT registered but I don't sell boats by way of trade. I imagine I don't have to charge VAT, but I don't know for sure.

 

MtB

 

As I understand it, if you have not claimed vat relief for the vessels purchase or for its repair/maintenance and you are not a dealer in boats then it is a personal chattel and as such is not subject to vat. As regards to boats coming in from abroad, that should be subject to VAT if resold, then my understanding is that all you need to do is keep it for, I think, 3 years and it then does not have any VAT liability upon sale. Best thing is to phone the VAT help line and ask.

[by'eck]

Now I'm intrigued. What about if I sell someone my boat? I am personally VAT registered but I don't sell boats by way of trade. I imagine I don't have to charge VAT, but I don't know for sure.

 

MtB

 

Your business VAT registration is completely irrelevant Mike if you make a private sale.

[Sheila in Sanity]

As I understand it, if you have not claimed vat relief for the vessels purchase or for its repair/maintenance and you are not a dealer in boats then it is a personal chattel and as such is not subject to vat. As regards to boats coming in from abroad, that should be subject to VAT if resold, then my understanding is that all you need to do is keep it for, I think, 3 years and it then does not have any VAT liability upon sale. Best thing is to phone the VAT help line and ask.

I once phoned the VAT hot line on behalf of my employers to clarify an issue with trade with Ireland. We followed the clear instructions we received and did not pay VAT on the trade. At the next VAT inspection the Inspector told us that was completely wrong and we should have paid tax. We not only had to pay the arrears but a fine as well. The inspector told us that we couldn't possibly have received the advice that we reported.

 

Unless you have the facilities to record your call I would always either email or use snail mail so you have proof of the advice you receive.