VAT and import duty on a superyacht tender
The tax treatment of a superyacht tender depends on three things: where it is delivered from, where it is going to be operated, and the tax status of the vessel that carries it. This page covers the standard cases for EU, UK, US, and Channel Islands programmes. It is reference material, not tax advice. Every transaction needs sign-off from a marine VAT specialist on a current basis.
The headline rule: if the tender is treated as ship's equipment of a tax-paid yacht, it usually inherits that status. If it is purchased separately, it is its own taxable supply.
EU position
Inside the EU, a tender bought new from an EU yard for a private buyer attracts VAT at the rate of the country of supply, with EU member-state rates currently ranging from 17% (Luxembourg) to 27% (Hungary), and the most common rates being 20-22% (France, Italy, Spain, Germany). The standard EU VAT rate applicable in most superyacht-relevant supplies sits around 20-22%.
For a private buyer in France, that means a EUR 1,000,000 tender is delivered with EUR 200,000 of French VAT. For a buyer in Italy, it is 22%, so EUR 220,000.
Three ways the headline rate is reduced or deferred in superyacht practice:
- Export from the EU: a tender delivered ex-yard for direct export outside the EU is zero-rated for VAT, with proper export documentation
- Supply to a commercial vessel: tenders supplied as ship's equipment to a qualifying commercial vessel can be zero-rated under Article 148 of the EU VAT Directive
- Lease structures: certain leasing schemes (historically Maltese, Italian, French; see tender finance and leasing) allowed deemed VAT recovery on a use-and-enjoyment basis
The leasing route has narrowed substantially since 2020 EU guidance restricted the use-and-enjoyment apportionment that earlier schemes relied on. Treat any pre-2020 case study with care.
Article 148 commercial yacht supply
Under Article 148 of EU Council Directive 2006/112/EC (the VAT Directive), supplies of equipment to vessels engaged in commercial activity on the high seas can be zero-rated. For tenders, this means a yacht in qualifying commercial operation (commercial registration, charter use) can take delivery of the tender as ship's equipment without paying input VAT.
This regime was tightened by EU jurisprudence (notably the A Oy case, C-526/13, and subsequent guidance) to require the vessel to be navigated on the high seas for reward. The implementation varies by member state. France, Italy, and Spain each apply their own interpretation. The result: the same charter yacht may secure VAT-free tender supply in one jurisdiction and not another.
For owners structuring a new tender purchase under a charter operation, the route is viable but needs jurisdiction-specific filing and strict charter qualification.
French Commercial Exemption
The French Commercial Exemption (FCE) regime applies to qualifying commercial vessels operating from French ports. For yachts qualifying under FCE, VAT on tender supply is recoverable under Article 262 II of the French CGI. The qualifying conditions include:
- Commercial registration of the parent yacht
- Minimum charter activity threshold
- Crew employment compliance
- Charter contracts at arm's length
The FCE regime has been the subject of ongoing French and EU scrutiny. Verify current eligibility with a French marine tax counsel before relying on it.
UK position post-Brexit
Since 1 January 2021, the UK is outside the EU VAT area. The UK standard VAT rate is 20%. Key consequences for tenders:
- Tenders delivered to UK private buyers from UK yards bear UK VAT at 20%
- Tenders shipped from EU to UK are imports, attracting UK import VAT at 20% on landed value plus any applicable duty
- Tenders shipped from UK to EU are exports, zero-rated UK, then face EU import VAT at the destination member state rate
- Returned Goods Relief allows UK-VAT-paid tenders re-importing within 3 years to clear without further VAT, subject to evidence
The UK-EU split has materially complicated tender movement for yachts cruising between the two regimes. Yachts based in the Mediterranean carrying UK-paid tenders need to track their VAT status carefully on each crossing.
US position
The US has no federal VAT. Sales tax applies at the state level on tender purchases from US dealers. Florida, the dominant US yacht-tender market, has a 6% state sales tax with a USD 18,000 cap on boat sales. New York, Maryland, and other states have their own caps and rates. Importation from foreign yards into the US attracts:
- Import duty at 1.5% on most pleasure craft hulls (HTS 8903)
- No federal VAT
- State use tax may apply on landing or first use
Foreign-flagged yachts cruising US waters carrying foreign-VAT-paid or foreign-supplied tenders are generally not subject to US sales/use tax provided the carrier yacht remains under cruising-permit status. Yachts intending to base in the US long-term need to formalise import.
Temporary Admission and the 18-month rule
The EU Temporary Admission (TA) regime allows non-EU resident owners to import non-EU yachts (and tenders carried) into EU waters for up to 18 months without paying EU import VAT. The regime is widely used by US-based and other non-EU owners. Key points:
- The owner must be non-EU resident
- The vessel must be flagged outside the EU
- Use is restricted to private; charter triggers immediate import
- The 18-month clock can be reset by leaving EU waters, with proper exit documentation
A tender carried by a TA yacht inherits the TA status. A tender purchased separately while inside EU waters does not. Owners adding a tender mid-cruise need to structure the supply to preserve TA status (typically: ex-works delivery, immediate export documentation, TA paperwork update).
Customs duty on hulls
EU customs duty on pleasure boats imported from outside the EU is generally 1.7% on motor yachts (HTS 8903.92) and 2.7% on inflatable craft (HTS 8903.10), applied to the landed CIF value. UK rates broadly mirror this since Brexit. The duty is in addition to import VAT. A USD 1m tender shipped from the US to Italy faces approximately 1.7% duty plus 22% Italian VAT on the duty-inclusive value.
Tender as ship's equipment
The recurring practical question: is a tender carried by a tax-paid yacht itself tax-paid? The HMRC and equivalent EU positions are aligned in principle: a tender that is integral to and carried by the parent yacht inherits the yacht's tax status, provided it is supplied with the yacht and shown on the yacht's specification and inventory.
A tender bought separately, delivered separately, used separately, or transferred between yachts is a separate taxable supply. The practical line is documentary: invoice trail, supply contract, integration into the yacht's specification.
For used tender purchases, the VAT history of the boat is part of due diligence. A tender with no VAT-paid evidence trades at a discount; assume the buyer will need to pay VAT to clear it for EU use.
Brokerage and second-hand transfers
A tender resold privately within the EU does not normally attract additional VAT if it has VAT-paid status. A tender resold by a registered dealer falls into the dealer's VAT margin scheme in some jurisdictions. Cross-border resales (UK to EU, EU to UK, US to EU) trigger import VAT unless qualifying for relief.
Keep the original VAT invoice or import documentation with the boat for life. Without evidence, the boat is treated as VAT-unpaid for resale purposes, regardless of actual history.
Charter, private use, and changes of use
A yacht's tax status is not static. Changes that can trigger re-assessment of tender VAT:
- Switch from private to commercial registration (may require import VAT settlement on the tender if originally supplied private)
- Switch from commercial to private (may trigger output VAT on a deemed self-supply)
- Flag change between EU and non-EU
- Permanent relocation between tax jurisdictions
Plan these transitions with VAT counsel; a tender that was clean for use under the previous status may need fresh paperwork under the new one.
Working list of figures
For quick reference, the rates referenced above (verify with current published guidance):
- EU standard VAT rates: range 17%-27%, France 20%, Italy 22%, Spain 21%, Germany 19%, Netherlands 21%, Malta 18%
- UK VAT: 20%
- EU import duty on motor pleasure craft: typically 1.7%
- US import duty on pleasure craft: typically 1.5%
- EU Temporary Admission period: 18 months
- Florida boat sales tax cap: USD 18,000
For a specific transaction, send us the structure (yacht flag, tender supplier, intended operating area, owner residency) and we will route it to the right marine VAT counsel before contract.
This page is reference. Tax law and HMRC, French DGFiP, and equivalent EU member-state guidance changes annually. Get current advice before signing.