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RYA and British Marine request further guidance on Returned Goods Relief

Published on: 19 October 2020

ore guidance needed, urges RYA and British Marine, as HM Treasury announces 12-month extension on Returned Goods Relief

British Marine and the Royal Yachting Association (RYA) joint statement on Brexit discussions with HM Revenue & Customs (HMRC) 

The RYA and British Marine jointly persevere in asking the Government to increase the one- year Returned Goods Relief (RGR) extension period and supply further detail for recreational boaters and the leisure marine industry as the end of transitional period approaches.

In light of the difficulties in taking advantage of transitional arrangements due to COVID-19, HM Treasury has now shared its updated plans with the Royal Yachting Association (RYA) and British Marine for an extension period of one year on its Returned Goods Relief policy.

This announcement from the Treasury follows both organisation’s repeated calls to HM Revenue & Customs for a review of the transitional arrangements for post-Brexit customs and VAT issues.

Following a virtual meeting between the RYA, British Marine and HMRC on 14 September in which HMRC updated the group on the Government’s approach to RGR after the transition period, the RYA wrote to the Financial Secretary of the Treasury to raise concerns about the ineligibility for RGR to be applied to recreational craft that have been based in the European Union (EU) for more than three years. The Minister has now responded to confirm that the Government will extend RGR for a period of a further one year to goods that left the UK/EU more than three years before the end of the transitional period and are currently in the EU provided the other conditions of RGR are fulfilled.

Responding to the Government announcement, the RYA’s Director of External Affairs, Howard Pridding, said: “We are pleased that the Treasury has listened to our concerns however, a one year extension remains wholly short of the three year transitional arrangement that is needed and fulfilling the other conditions of RGR is causing further uncertainty. Recreational boating is a seasonal market and moving boats is affected by weather conditions and other safety related issues. The COVID-19 situation additionally complicates this, and boat owners are going to need a realistic transitional period to establish a date of export to qualify for RGR.

“We will continue our dialogue with HMRC pressing them to understand that eligible recreational craft should secure relief from VAT and import duty on arrival in the Customs territory of the UK if it meets the criteria for RGR and has returned to the UK by 23:00 UTC on 31 December 2023. We also need answers to questions of detail that we have been repeatedly asking the Government before we can feel confident in the advice that we are providing to RYA members”.

Lesley Robinson, CEO of British Marine, said: “Whilst I appreciate the HM Treasury turning their attention to this issue, there are still fundamental questions and matters that need answering. For example, establishing a ‘date of export’ for a boat to qualify for RGR needs clarifying. It is clear that the impact of COVID-19 and travel restrictions means that the one year extension still falls a long way short of what is required for boaters and marine businesses to make all the necessary arrangements for movement of vessels and future planning. We will persist in our efforts on behalf of British Marine members.”

The post-Brexit VAT and Customs arrangements will affect thousands of boat owners resident in the UK who keep their boats in EU27 countries.  A recent survey carried out by the RYA showed that 917,479 recreational boaters cruise in EU27 waters. Until HMRC provides further information, it remains impossible to provide reliable guidance to boat owners on where best to locate their boat when the transition period ends at 23:00 UTC on 31 December 2020 to facilitate their future cruising plans.

This will not affect the following:

  • Boat owners who are established outside the UK who should be eligible to visit the UK under Temporary Admission.
  • Boats kept in the UK and which visit the EU for short stays of up to 18 months, as it should still be possible to take a boat to the EU without paying VAT and import duty under EU Temporary Admission.
  • Boats kept in the EU27 whose owners have no intention of bringing the boat back to the UK.
  • Boats lying elsewhere in the world, as these vessels have always been subject to RGR and needed to return within 3 years in order to re-enter the EU or the UK without being required to pay VAT and import duty.
  • The RYA and British Marine can provide a chronology detailing their efforts to engage constructively with HMRC on this issue over the last three years.