Purchasing a yacht comes with a multitude of considerations. The last thing you’ll want to worry about is sorting out VAT technicalities.

Below, we’ve pulled together everything you need to know about VAT, what VAT paid vs. Non-VAT paid yachts are, Greek and EU laws surrounding VAT, exactly how much and when you’ll need to pay, and more.

What VAT Paid Really Means

VAT Paid Yacht Meaning: VAT paid yachts are vessels with documentation to prove legal VAT (Value Added Tax) has been paid on them. VAT paid yachts are therefore permitted by law to occupy that country’s waters. Vessels with VAT paid to the European Union can travel freely within EU waters.

Non-VAT Paid Yacht Meaning: These are oftentimes used or imported yachts that the buyer will need to pay VAT on in order to legally own and operate. Some yachts, namely commercial vessels, are VAT-exempt.

Temporary Admission (TA): Temporary Admission is granted to non-EU boat owners with a specific set of circumstances. If these requirements are met, the yacht and its owner qualify for the Temporary Admissions Regime, and are allowed to sail non-EU yachts in the EU without paying VAT. 

Many factors come into play when determining the necessity of VAT payment on a vessel. These include but are not limited to:

• Owner nationality
• Yacht purchase location
• Yacht purchase documentation
  • Is it already VAT Paid? All our vessels are clearly marked.
• How long the yacht has spent the country
• Which country owner and yacht are looking to sail in
• Nature of the yacht’s operation
  • Commercial
  • Charter
  • Private

For the sake of this article, we’ll only be discussing private “for pleasure” yachts. For information about chartered, crewed, and commercial vessels, visit correlating government websites.

Legal Requirements

Greece (and European Union)

Find out more here.

VAT is chargeable on privately owned and used yachts in Greece. This goes for yachts purchased in Greece as well as those imported by EU residents. Boats sailed for over 6 months in the EU/Greece are also required to pay VAT regardless of the nationality of its owner. EU VAT Paid vessels have the right to free movement across the EU. Spending over 6 months on any country within the EU may subject you to their individual VAT or yachting laws. You must also keep on board legal documentation proving VAT status. More private boat information can be found here.

United Kingdom

Find more information on www.gov.uk.

In essence, if you operate a yacht for pleasure in the UK, you must pay VAT on your purchase, regardless of whether the yacht is new or used. If you are a UK resident with the intention of keeping a vessel in the UK, you must pay VAT on your purchase. Furthermore, foreign vessels must be duty-paid as UK domestic goods and must have the ability to be moved without restrictions. Imported yachts must be able to prove customs clearance documents.

From this point forward, this article will only refer to Greek (and European Union) VAT laws and regulations.

Financial Implications

How much will VAT cost you?

In Greece, new yacht purchases are subject to a standard 24% VAT. This must be settled through legal documentation that remains onboard at all times. If these conditions are met, a vessel is legally entitled to sail freely within the EU.

However, tax obligations don’t end here. Yachts registered in Greece that are above 7 metres high and that aren’t dry docking are required to pay an additional recurring fee known as TEPAI (The Recreational and Daily Tour Cruise Ships Fee). All boats meeting these requirements are subject to TEPAI regardless of original nationality or ownership.

TEPAI is paid monthly and must be paid before (or, at the latest, on the day) of entry into Greece or before the start of each month (for ships already in Greece). 

In order to calculate your specific TEPAI, you must know the length of your vessel. The costs are as follows:

• 7m < total length ≤ 8m: 16€/month
• 8m < total length ≤ 10m: 25€/month
• 10m < total length ≤ 12m: 33€/month
• Total length > 12m: 8€ per metre/month

Discounts are possible, however. If you pay a year’s worth of TEPAI up front, you may be eligible for a 10% deduction on your fee. Additionally, ships spanning beyond 12 metres can qualify for a 20% (or even 25% discount).

There are a few ways to pay TEPAI. A popular method is via eTEPAI, an online electronic application. You can also pay at a Collection Agency, tax office, Customs Authority, or Port Authority.

All TEPAI information, regulations, and legal requirements are provided by the Greek government here.

Risks for Buyers and Common Pitfalls

VAT and government fees can pose obstacles for some buyers and can be high maintenance. When in doubt, contact a professional or speak to your brokerage.

• VAT
  • You do not qualify for income tax deductions on any yacht costs as you are not generating income.
  • You must have documentation on you at all times proving VAT status.
  • If a yacht is listed as non-VAT paid at time of purchase, you must pay the VAT upon registration in order to legally own and sail the yacht in Greece.
  • Be mindful of time spent in Greece and other countries with your yacht. What can begin as a legal trip to another country can quickly become unregistered sailing after the six month marker (and under other circumstances).
  • If you spend an extended period of time outside of the EU, you may be required to pay VAT when returning. Be sure to check official regulations to confirm if this is the case for you and your yacht. Currently, those spending three years outside of the EU are responsible for re-registering for EU VAT. 
• TEPAI regulations
  • TEPAI operates on a notoriously strict timeline. Be sure you pay on time.
  • TEPAI fines can run you up to 1.100€ in fees, so be careful when applying discounts and organising payments. Have you double checked your eligibility?
  • You cannot get a refund on TEPAI if you leave Greece early.
• General
  • Be sure you’ve had a professional marine survey done on your yacht prior to purchase. 
  • Inspect your prospective vessel yourself as well. For tips on how to inspect your yacht in addition to surveying, be sure to check out our related blog.
  • Ensure you’ve accounted for all required taxes, documentation, regulations, registrations, fees, and insurance necessities.

How to Verify VAT Status

Working with an experienced yacht brokerage will make the VAT process much easier than sourcing and verifying information yourself. Luckily, One Yacht can help with all VAT status-related queries on any of our new or used yachts.

In order to verify that a yacht has paid VAT on it prior to purchase, ask to see documentation. All VAT paid yachts will have paperwork proving this status. In cases with missing or lost VAT information, a brokerage will be able to source up-to-date legal information.

Are you ready to begin your yacht purchasing journey? Start with us. You can view our full range of new and used yachts on our website. Purchasing a boat of your own can be an exciting process, but also a long and confusing one. If you have questions, feel free to send us an email. We’ll be glad to offer guidance.