Cowes inshore lifeboat for sale

Tim M · 19 July 2008, 20:58

http://cowes.boatshed.com/rib_88m-boat-53011.html

Pretty good price for such a large boat.

Neil Harvey · 19 July 2008, 21:03

then add £4375 for VAT

Ian Sharlot · 19 July 2008, 21:38

Quote:

Originally Posted by Neil Harvey

then add £4375 for VAT

I did notice that but can't work out why, If the current owners are vat exempt being a charitable trust. how is vat payable on the selling price.

If they are vat exempt, how can they sell the boat at a + vat price. I assume you won't get an invoice with a vat number on and then you can't claim the vat back?

Can anyone explain how it works with a charity?

the bandit · 19 July 2008, 22:07

Quote:

Originally Posted by Ian Sharlot

I did notice that but can't work out why, If the current owners are vat exempt being a charitable trust. how is vat payable on the selling price.

If they are vat exempt, how can they sell the boat at a + vat price. I assume you won't get an invoice with a vat number on and then you can't claim the vat back?

Can anyone explain how it works with a charity?

Only a guess but it may work on th e same priniple as coaches

They are zero rated to the customer however we can claim all VAT back on purchase, repairs and fuel. When you come to sell you have to pay the Vat back on selling price

Action Man · 19 July 2008, 22:14

or may have somthing to do with the fact vat must be payed on a boat when it is new or has not had vat payed on it before

Ian Sharlot · 20 July 2008, 07:36

Quote:

Originally Posted by the bandit

Only a guess but it may work on th e same priniple as coaches

They are zero rated to the customer however we can claim all VAT back on purchase, repairs and fuel. When you come to sell you have to pay the Vat back on selling price

Sorry I may be a bit slow on this, But if a trader was vat registered and brought this boat, they would want to claim the vat back, the way I see it, they can't. so is the boat £25,000 + vat or is it £29,375 as if it were a private sale but the RNLI have to repay there vat back? can the boat be advertised at a price + vat if they are not registered. If we did it as a private seller, would it not be called fraud?

I have know of this situation before on a RNLI purchase, thats why I am keen to find the answer.

Action Man · 20 July 2008, 08:00

cowes is not RNLI

MIRO Stewart · 20 July 2008, 15:21

Quote:

Originally Posted by Action Man

may have somthing to do with the fact vat must be payed on a boat when it is new or has not had vat payed on it before

I suspect this is the most likely as cowes probably didnt pay the VAT on the original purchase. However, as stated if it is being purchased by VAT reg'd company you can claim it back.

Quote:

Originally Posted by Action Man

cowes is not RNLI

It is now! RNLI took control of the station on the 1st of July with an Atlantic 85 being put on service.

Action Man · 20 July 2008, 17:30

ahhhh ok, i stand corrected

Observer · 20 July 2008, 21:32

I'd need to check VAT manual for the details but this is very probably because RNLI's activities are funded by charitable donations. Therefore, by a special dispensation, suppliers to RNLI are allowed to zero rate the supply of (some, maybe not all) goods and services. However, when RNLI sells a boat it has purchased with the benefit of this exemption, it has to account for VAT on the selling price. So the net VAT loss to HMRC is VAT on the depreciation.

It's not unique to boats. The dispensation applies to a range of other goods. I've come across it before on medical equipment.

MIRO Stewart · 21 July 2008, 00:47

Quote:

Originally Posted by Observer

I'd need to check VAT manual for the details but this is very probably because RNLI's activities are funded by charitable donations. Therefore, by a special dispensation, suppliers to RNLI are allowed to zero rate the supply of (some, maybe not all) goods and services. However, when RNLI sells a boat it has purchased with the benefit of this exemption, it has to account for VAT on the selling price. So the net VAT loss to HMRC is VAT on the depreciation.

It's not unique to boats. The dispensation applies to a range of other goods. I've come across it before on medical equipment.

Correct, there is some form filling to be done but yes suppliers can supply certain goods to charities a a zero vat rate, it applies to most items but not to others for example shoes! I know because we cant get zero vat shoes for the rescue boat!

Ian Sharlot · 21 July 2008, 11:30

thanks for the imformation on this one. I must say, it seems far from simple.

Channel Ribs · 21 July 2008, 12:15

Quote:

Originally Posted by MIRO Stewart

I know because we cant get zero vat shoes for the rescue boat!

Is workwear not VAT free?

Not that I am suggesting you wear steel toe cap boots on a boat.

havener · 21 July 2008, 13:29

Quote:

Originally Posted by malthouse

Is workwear not VAT free?

Not that I am suggesting you wear steel toe cap boots on a boat.

Had this situation a few years back with another independent station who couldn't get their local VAT office to exempt drysuit purchases.

It's because in law the VAT exemption applies to rescue equipment - i.e. the boat, radios, MOB devices, etc...but not things like PPE. It's far from straightforward.

It's also why there is a very low threshold for items for resale (fundraising branded items, etc) and why for example the RNLI don't sell souvenirs - RNLI Trading Ltd do that (with profits covenented back to the RNLI).