QUESTION
“I’m planning a 10 day private yacht charter in St. Tropez and the South of France in July. My broker say VAT is 20%. That’s seems a lot. Is there way to not pay this?”
Xavier E, Barcelona, Spain
Answer provided by Jana Sheeder, President 1-800 Yacht Charters:
“The bad news, Xavier, is all charters that take place in a European Union (EU) country are subject to VAT (Value Added Tax). However, we have good news as well – there is a simple, legal strategy that can cut your VAT expense in half.
Instead of paying 20%, this strategy will reduce your VAT to 10% of your base charter fee – a significant savings!
Each EU country can set their own level of VAT on commercial yachts for hire. In France, if the yacht undertakes a coastal cruise in French territorial waters, the VAT is 20% of the base charter fee (the base fee is the cost to rent the yacht before factoring in other running expenses such as food, dockage, etc.). So, for example, if you began your charter in Saint Tropez, and cruised along the Côte d’Azur and concluded your trip in Antibes, you would incur a VAT expense of 20%.MORE INFORMATION ABOUT VAT
However, IF you plan a portion of your charter to cruise in international waters, your legal responsibility for VAT drops to 10% – a savings of 50%!
So how do you do this? Here’s how: When you are planning your itinerary with the yacht’s captain prior to the commencement of your charter, let the captain know that you would like to, “visit a port that requires you to cruise in international waters and beyond the coast of France.”
You could, for example, leave the French coast and cruise to the island of Sardinia. This is approximately a 5-7 hour cruise from the South of France.
Ask your captain to undertake this crossing overnight, while you and your guests are sleeping. Then, when you rise in the morning, you’ll be able to spend a full day, or longer along the coastline of this fabled Italian island before heading back to France.
So there you have it. With a little strategic planning, a slight deviation in your St Tropez yacht charter can result in big savings; possibly thousands of Euros depending upon the cost of your charter.”
Jana Sheeder, President of 1-800 Yacht Charters and 1-800 BAREBOAT
Have a question about a yacht charter vacation?
Submit your question to me, and my team will help you.
If we print your question in our blog, we’ll send you a complimentary Eco-tote bag.
Email me at jsheeder@1800yachtcharters.com
Thank you, and keep those questions coming!!!
This entry was posted in Destinations Frequently Asked Questions Educational and tagged Ask The Pro's, Save money on a yacht charter, Tips and tricks, Ask the Yacht Charter Pros, Discounts, VAT value added tax, private yacht charter, Jana Sheeder, 1800yachtcharters, Education
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A new, higher VAT (Value Added Tax) rate went into effect. All charters that commenced after July 20, 2015 in Greek waters are subject to the tax.
Greek yacht charter vessel at anchor
The new legislation raised the overall VAT from 13% to 23%. Specifically, lower rates apply to certain charters, based upon the duration of the hire.
There are two VAT categories for charters lasting 3 days or longer:
For charters up to 48 hours, there are no discounted rates. Full VAT of 23% is due (previously 13%).
Jana Sheeder, President of 1-800 Yacht Charters, points out the new VAT rates affect ALL charters taking place after July 20, 2015 – even if the charter agreements were signed in prior months. “With the current economic crisis in Greece, we’ve been anticipating some form of VAT austerity,” says Sheeder. “With each charter agreement we prepare, we add a clause indicating that the charterer is responsible for any increase in VAT – this way, there are no surprises. The more details we cover with our clients, the smoother their Superyacht Experience will be.“
How will the increase in VAT on private luxury yacht charter vacations in Greece effect the number of yacht charters?
Will clients seek alternate destinations or, “grin and bear it” to enjoy a Greek yachting holiday?
Let us know your thoughts. We will share your comments with our readers AND send you a free complimentary Eco-tote bag! Email your comments (and your mailing address!) to info@1800yachtcharters.com
This entry was posted in News Educational and tagged sailing yacht charters, Q & A, motoryacht charter, Greece, Mediterranean yacht charter, Eastern Mediterranean yacht charter, VAT value added tax, eco-tote, greece yacht charter, free gift
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First the bad news – recent legislation in Greece has led to an increase in the country’s VAT rates.
Now for the good news – the increase is small, and depending upon the duration of your superyacht experience, the “effective rate” should have a minimal effect on most Greek yacht charters this summer.
A new VAT rate of 24% has been announced for Greece, and it will affect all yacht charters commencing on or after June 1st, 2016. The old rate was 23% – making the maximum increase 1%.
While 24% VAT sounds sky-high, don’t fall out of your chair just yet: there are significant built-in discounts that can reduce the effective VAT rate by up to 60% – depending upon the duration of your charter vacation.
Here’s the math:
I) Charter duration of 3 days or more.
Luxury yacht charter vessels performing international cruises have a discount of 60%. This makes the effective VAT rate 9.6% (up from 9.2%).
Charter vessels cruises within Greek waters will earn a discount of 50%, setting the effective VAT rate at 12% ( previously 11.5%).
II) Charter duration up to 48 hours.
This is where you get hammered as a charterer for taking a day excursion or a trip shorter than 48 hours. There is NO discount, regardless of where the vessel cruises. A full VAT of 24% is due (instead of the previous 23%).
In summary – avoid short-term charters in Greece if you can. As long as you can extend your charter beyond 48 hours, the impact of the effective change in VAT is less than 1%. Mykonos and Santorini here we come – Opa!!!
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For information about renting a luxury charter yacht in Greece, or anywhere else in the Mediterranean this summer, contact 1-800 Yacht Charters at +1.800.922.4824 (toll-free North America) or +1.305.253.7245 (international), use our online inquiry form here, or email info@1800yachtcharters.com
This entry was posted in News and tagged How to decrease VAT on a yacht charter?, Mediterranean yacht charter, VAT value added tax, yacht charter Greece, Greek yacht charter, Mykonos, Santorini
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In January, 2014, we alerted our clients to new rules. These rules regard a VAT increase imposed on Croatia yacht charter rentals. The government increased the VAT rate from 10 % to 13%. This was to combat the country’s economic woes.
We, therefore, focused on saving money for clients. We encourag our clients to commence their charters in nearby Montenegro. They could then cruise into Croatian waters, tax-free.
In spite of this, good things sometimes come to an end…
Effective this month, new regulations take effect. These eliminate the loophole that allowed tax-free cruising in Croatia.
This February, the Croatian Ministry of Maritime Affairs made an announcement. The regulations that govern the Croatia yacht charter market were amended to, “…bring the regulations in line with other European Union Member States.” The main change was, therefore, the imposition of VAT on charters starting outside of Croatia.
As succinctly explained by 1-800 Yacht Charters company President, Jana Sheeder,
“As of May 1st, 2018, charters commencing outside Croatia that then cruise into Croatia, will now have to pay 13% VAT on the time spent in Croatian waters.”
The new regulations are not retroactive. Thus, any charters booked prior to the regulation change are exempt.
On a positive note, other regulation changes designed to encourage an increase in yacht charter Croatia activity will also go into effect. The government has lifted the restriction that banned non-European Union charter yachts under 40 meters from chartering in Croatia. As explained by Rory Jackson of SuperyachtNews, “These restrictions, which prohibited non-EU commercial vessels under 40m chartering in Croatia, had been implemented to bolster the domestic market. However, they proved to be more costly than beneficial.”
Non EU flagged yachts under 40 meters will need to secure a charter license to operate in Croatia. The license will be required even if the charter starts outside Croatia.
Are you considering a private yacht charter vacation in Croatia or elsewhere in the Mediterranean this summer? Click https://www.1800yachtcharters.com/superyacht-charter/ for a sampling of superyachts available this summer.
Come enjoy The Superyacht Experience as only 1-800 Yacht Charters can deliver!
This entry was posted in Yacht Charter Destinations News Educational and tagged president of 1-800 Yacht Charters, yacht charter education, yacht charter croatia, charter restrictions, Croatia yacht charter, summer yacht charter plans, Mediterranean yacht charter, VAT value added tax, Jana Sheeder, Education, Superyacht
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“In each of the past three summer seasons, we have seen an increase in interest in Dalmatian yacht charter adventures in Croatia,” says Sheeder. “We are advising our clients to budget not only for the increase in VAT, but also for the higher excise taxes on fuel that were approved in November. In short, the cost to enjoy both a Croatia bareboat rental or a fully crewed yacht vacation will cost about 5% more in the summer of 2014.”
This entry was posted in Destinations News and tagged VAT, sailing yacht, yacht charter croatia, Eastern Mediterranean yacht charter, luxury yacht charter croatia, VAT value added tax, Destinations, Jana Sheeder, 1800yachtcharters, Croatia, Waterfalls, sailboat charter, president of 1-800 Yacht Charters
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