Re-importing general commercially moved commodities back into the UK would be seen as straightforward. We would need the following:
There would be evidence of initial export – ideally with a copy export declaration and if not then supporting transport documents proving the move.
Commercial documents – a sales invoice or contract
Both would then prove UK free circulation goods are returning, so as long as they are then being imported by the same entity who exported them, then RGR would be accepted.
Pleasure craft though, and particularly those which are privately owned, are a different ball game altogether. They can sail out under their own power, which means no documents to support the movement out of the UK. Brexit hasn't helped either as it has meant that UK yachts in the remaining EU 27, at the time of Brexit, would now have EU VAT paid status and could have been located outside of the UK for quite some time. This can make the gathering of all the required proof quite a task for an owner.
For a pleasure craft, the main conditions to consider for meeting RGR are as follows:
The goods were exported from the UK, and there is proof of export
They were at that time in free circulation, with no outstanding or relieved duties
They have not been repaired or processed while outside the UK, apart from routine maintenance.
In order to use Returned Goods Relief to relieve import VAT. You will need evidence that it is the same person re-importing the vessel as had previously exported it.
The goods are imported within 3 years of the original export. Although, this only applies to commercial imports. Personal property, including privately owned pleasure craft which we are focusing on, would have this requirement waived.
So what can be done if those yachts want to know come back to the UK, how do they qualify for RGR and what do we do in the absence of official proof of an export movement? Official proof would refer to an export declaration departure and shipping documents such as a Bill of Lading.
We have to prove that the importer had previously had the yacht in the UK.
If you have no shipping or customs documents for the export, then proof that you physically owned and had the yacht in the UK will be acceptable. Berthing receipts are a good one as it shows location and time. Your certificate of registry should be provided too.
2. VAT paid status needs to be proved.
As with all yachts there should be a clear audit trail of owners and proof in the chain that VAT has been paid and then not lost. A document chain showing correct allocation of VAT being accounted for in the yachts history. This is particularly important for yachts purchased second hand as you may need a document from a previous owner showing that they paid VAT to the original broker or manufacturer.
3. It needs to be determined that the yacht is the same as went out .
A current valuation by an independent broker to show value hasn’t increased due to major overhaul, coupled with a signed declaration by yourself stating no work done should suffice.
4. Current ownership needs to be proved.
The yacht should be registered under the current owner’s detail. The current owner should be the same as on initial export out of the UK. In the absence of export documentation in the same name then my first bullet point above should also cover this one as long as the owner is the same.
This doesn’t apply if the pleasure craft is privately owned.
It is not enough to take an owner’s word for it, and it is a requirement of any good Customs Broker to request this information before they proceed. Just because the import declaration has been cleared does not mean that it is all ok. Audits can be actioned after the clearance. Cleare records can mean that you may be asked to pay any VAT liabilities if HMRC are not fully satisfied.
We just had an audit on a selection of RGR import that we have submitted over the last year. We were asked to prove that the conditions were met. All our documents are kept on file electronically so we passed them over for the HMRC Pleasure Craft team to audit. 14 sets of documents in total. All passed the audit.
If you need any advice or wish to re-import your yacht and would like to understand if it qualifies for RGR then please get in contact via our contact form and we will get back to you as soon as possible