As the yacht fleet manager, ensuring that all yachts under your management are VAT compliant is crucial for the successful operation of your business. Value-added tax (VAT) is a tax on the value added to goods and services, and it applies to yacht charters in the European Union (EU) waters. Here are some ways that yacht fleet managers can ensure VAT compliance on their yachts:
VAT registration: Ensure that all the yachts under your management are properly registered for VAT in the EU countries where they will be operating. This includes obtaining a VAT number and submitting VAT returns to the relevant tax authorities.
Record-keeping: Maintain accurate and detailed records of all transactions related to the yachts, including charter fees, crew salaries, fuel costs, and other expenses. This information should be well-organized and easily accessible for auditing purposes.
70% rule compliance: Ensure that all yachts comply with the 70% rule, which stipulates that a yacht must spend at least 70% of its time cruising outside of EU waters to be exempt from VAT. Monitoring the yachts’ movements and keeping accurate records of their itinerary can help ensure compliance with this rule.
Crew training: Educate the crew on the VAT regulations and the importance of compliance. The crew should be aware of the VAT rates, exemptions, and reduced rates applicable to different countries and understand the requirements for VAT registration and reporting.
VAT specialist: Engage the services of a VAT specialist to ensure that your business is compliant with the VAT regulations. A VAT specialist can provide guidance on VAT registration and reporting, as well as on the proper handling of VAT-related documentation.
Communication: Maintain clear communication with the yacht owners and charter clients regarding VAT compliance. Ensure that all parties are aware of the VAT rates, exemptions, and reduced rates applicable to different countries and that they understand the requirements for VAT registration and reporting.
Compliance audits: Conduct regular audits to ensure that all yachts under your management are compliant with the VAT regulations. This includes reviewing records, monitoring the yachts’ movements, and ensuring that all necessary VAT compliance measures are in place.
In conclusion, as the yacht fleet manager, ensuring VAT compliance on all yachts under your management is essential for the success of your business. You can achieve this by registering all yachts for VAT, maintaining accurate records, monitoring compliance with the 70% rule, educating the crew, engaging a VAT specialist, maintaining clear communication, and conducting regular compliance audits. By following these steps, you can ensure a smooth and successful operation of your yacht fleet and avoid any penalties associated with non-compliance with VAT regulations.
