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VAT

Hi there,
I am due to sell my home, and wish to purchase a wide beam as a live aboard subject to finding a suitable residential mooring. My question is, if the boat I buy is brand new would I have to pay VAT, if it was to be my home?
Regards
Griff

Asked by: Griff  | 8.45pm, Monday 12 April


WW says:

We printed the following news item in October 2009's WW:
HM Revenue & Customs has confirmed that live-aboard Dutch barges are no longer subject to VAT.
The decision had been widely expected following a High Court victory by boater Colin Stone. Lt Cmdr Stone successfully argued that those Dutch barges which could be used as a permanent residence were 'qualifying ships-- under the VAT Act of 1995 - and hence exempt from VAT.
Dutch barges were often 'zero-rated-- in the 1990s, but in 2004, HMRC issued a policy suggesting that a cargo-carrying hold was required. The new policy reverses that. Though HMRC still believes residential Dutch barges 'can also be designed for use as recreation or pleasure [craft]', and therefore not ships, it has conceded that the High Court decision makes it impossible for them to draw a clear distinction.
According to the 2009 update, 'we have decided to treat Dutch barges and similar vessels that are designed and supplied for use as the permanent residence of the customer as qualifying ships and eligible for zero-rating'.
HMRC now suggests that owners who recently paid VAT on their Dutch barges contact their builder, to find out whether a refund is possible. Further repairs, even extending to a new engine, could also be VAT-free - but not any domestic equipment and fittings.
The minimum size for a 'qualifying ship-- is 15 gross tons, where a gross ton is the length, beam and depth (in metres) multiplied together, then by 0.16. For narrowboats, HMRC says the depth is that below the gunwales, making it very unlikely that any narrowboats will qualify for the new exemption.
The full guidance can be read at www.hmrc.gov.uk by searching for 38/09.

Richard Fairhurst  | 2.24PM, Monday 19 April


Readers say:

we had a widebeam (12ft by 60ft) built in dec 2008, we received a full VAT refund in dec 2009, we claimed this back through our boatbuilder as the law changed after we bought the boat..if it is your permanent residence then you shouldn't pay VAT but check with your boatbuilder...

Rachel Rice  | 9.11PM, Monday 12 April

I would say check with your solicitor and the Inland Revenue...it's hardly a boating question, it's legal

peter west  | 9.13PM, Monday 12 April

the inland revenue will refer you to your boatbuilder...we tried to speak to HMRC without any luck...your boatbuilder's accountant will be able to deal with this..it was a query directed to boaters so I answered it and have first hand experience of this, I did say to check with your boatbuilder....there's no need to be patronising you'll put people off giving there opinions if you come across like that..

Rachel Rice  | 9.17PM, Friday 4 June

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