Temporary Admission (often referred to as Temporary Importation) can very simply be described as a mechanism that enables non European Union (EU) resident yacht owners to bring their yachts into Europe for a limited time, such as a holiday, and under certain conditions without having to pay VAT on the value of their yachts.
It is important that such a mechanism exists otherwise many non EU resident yacht owners would simply avoid visiting European waters as the costs of paying VAT on arrival would be prohibitive.
Temporary Admission – Criteria
The fundamental criteria for a yacht to qualify for Temporary Admission is that the yacht must be owned by a natural person (i.e. an individual) or a legal person (i.e. a company) who is established (i.e. resident) outside the VAT territory of the EU.
Temporary Admission – Time Allowed
The yacht can only be used within the EU for a maximum of eighteen months after its first arrival. Under certain conditions this time frame can be extended to a maximum of 24 months if vessel is laid up and usually bonded with the prior agreement of the authorities.
Temporary Admission – Restrictions
In practice it is not simply enough for a yacht to be owned by a natural or legal person established outside of the EU. The authorities will always look through the non-EU ownership of a particular vessel showing on its registration and look closely at how a particular vessel is being used.
This means that they would expect the principal user of the vessel, i.e. the individual or individuals who are the main users of the yacht, to themselves be established outside the VAT territory of the EU.
Principal users of yachts sailing within the EU under Temporary Admission should therefore be prepared to provide evidence to the authorities that they are genuinely not established in, or a resident in, the EU.
Temporary Admission – Arrival in the EU
The official EU guide to Temporary Admission states the following:
“Just crossing the frontier of the customs territory of the Community is in general sufficient. But, you may be required to use a route specified by customs and they may require you to make an oral or written customs declaration. It is possible they may require the provision of some kind of security or guarantee to cover the payment of the customs duties and VAT that become due if the boat does not leave the EU.”
The key point of this message is that procedures vary from country to country and it is therefore important that a yacht owner wishing to enter the EU under Temporary Admission carefully selects their EU entry point and understands in advance what formalities are required upon arrival.
Temporary Admission – Leaving the EU
Care should be taken when terminating Temporary Admission upon departure from the EU to a non-EU port. It is important that the yacht owner understands the relevant formalities required by the authorities of the state of departure and they should also check back in case the authorities of the EU country of arrival or any countries visited in between require any proof of departure from the EU.
The official EU guide to Temporary Admission states that the following with regard to the time that a yacht has to remain outside the EU before it can return:
“Yes, you are not limited to a single period of temporary import. You can sail the yacht out of the EU and when you came back again for another holiday a new period of temporary importation can begin. The customs rules do not provide for a ‘minimum period’ during which the goods must remain outside of the customs territory of the EU.”
Temporary Admission – Charter
In theory Temporary Admission is afforded only to yacht that are operated for private pleasure use.
Certain EU member states have in recent times allowed yachts operating under Temporary Admission relief to charter but usually with the restriction that the charter guests must be non EU residents and under the proviso that the owner and vessel complies with all relevant legal and fiscal requirements.
Temporary Admission – Sale of Vessel
The sale of a yacht whilst lying within the EU under Temporary Admission would breach the conditions of the relief.
Temporary Admission – Boat Shows
If a yacht is temporarily imported other than for cruising purposes, the specific Temporary Admission relief for a means of transport will not be applicable. For example, if a yacht is temporarily imported for a boat show, the Temporary Admission relief for exhibitions would be applicable.
Temporary Admission – Refit & Repair
If the importation of a yacht is for the purposes of major overhaul, refitting or refurbishment, it will not be eligible for Temporary Admission. In this case Inward Processing Relief (IPR) would be applicable.
Oceanskies – Non EU Yacht Ownership & Registration
Oceanskies is a marine and aviation consultancy based in the Channel Island of Guernsey and since our launch in 2013 we have grown rapidly to become one of the largest yacht registration and documentation consultancies in Europe.
Please do not hesitate to contact us to request a free no obligation registration quotation from Oceanskies.