British boaters face huge costs or be stuck abroad after Brexit
BRITISH boaters who have taken their boats to the European waterways could be stuck on the continent or face huge costs to return post Brexit.
In a joint statement, British Marine and The Royal Yachting Association are warning of urgent demand from recreational boaters and the leisure marine industry for government guidance and transitional arrangements on post-Brexit customs and VAT issues, as the end of transition period looms.
Hit with thousands of pounds extra costs
The organisations tells that UK boaters face a choice between being hit with potentially thousands of pounds in extra costs or their boat being stranded in the EU after the end of the Brexit transition period unless the government acts quickly.
Following discussions with HM Revenue and Customs (HMRC) that were initiated over three years ago, the two organisations now understand that the Returned Goods Relief (RGR) will only be available for goods returning to the UK provided that RGR conditions are met and that the goods must have been exported from the UK and return within three years of export. This will mean that, after the transition period, all boat owners established in the UK whose boats have not been in the UK in the last three years will pay VAT for a second time if they want to bring their boats back to the UK.
Would hit second-hand boat market
Failure to resolve issues relating to the post-Brexit implementation of RGR into UK law before 31st December would also deliver a significant hit to the second-hand boat market and marine industry in the UK, which is already fighting to recover from COVID-19.
Despite clear indications from HMRC in April 2019 that RGR would be incorporated into UK law, HMRC confirmed on 14th September 2020 that this would not in fact be universally available, generating significant uncertainty for UK boaters as the end of the transition period approaches. This followed an unacceptable delay in HMRC clarifying their position on this issue despite monthly dialogue.
RYA and British Marine are calling on the Government to commit to a transitional provision so that a recreational craft is eligible for relief from VAT and import duty on arrival in the customs territory of the UK if it returns to the UK by 23:00 Coordinated Universal Time (UTC) on 31st December 2023. This would allow UK boat owners with boats currently located in the EU27 to adjust accordingly and avoid unnecessary cost and disruption to their cruising plans.
Advise boat returned before end of year
The RYA and British Marine have briefed politicians on this situation. Boat owners who will be affected are encouraged to write to their constituency MP explaining their own circumstances and seeking support for a three year transition provision in RGR legislation. On the basis of this latest information from HMRC, if a boat has not been in the UK recently and the boat owner wishes to avoid the risk of paying VAT and import duty again, then the RYA and British Marine advise that the boat visits or is returned to the UK by 23:00 on 31st December in order to record a date of export.
Having initially approached the government three years ago, over the last 18 months both organisations have steadfastly worked in partnership to endeavour to address Brexit customs and VAT issues related to recreational boats with Her Majesty’s Revenue & Customs (HMRC), in order to provide accurate and timely advice to their respective members.
Concerned boat owners
The two organisations came together having individually repeatedly asked HMRC to answer questions concerning VAT, import duty, Returned Good Relief (RGR) and temporary admission. Having quantified the issues and catalogued the questions, a joint approach was made to HMRC in September 2019 seeking a meeting to clarify issues in order to respond with definitive advice to the increasing amount of enquiries from concerned boat owners and the trade.