Until very recently, any owner of a UK VAT paid vessel which has been outside of UK waters for more than 3 years was obliged to return this vessel in person by the 30th.June 2022 to UK waters in order to be eligible for Returned goods relief ( RGR ).i.e.  to retain it’s UK VAT paid status.

However, thankfully, HMRC have now abandoned this stipulation for leisure craft.

( see article by news editor Katy Stickland  in Yachting Monthly entitled “ Customs and VAT changes for UK boat owners.)

As a result, I was keen to have confirmation of the above and made contact with a very informative lady at the HMRC in the UK.

Her name is Lorna Irvine and her email address is This email address is being protected from spambots. You need JavaScript enabled to view it.

I emailed her with my boat details and construction in 1996 in Cornwall VAT paid, and explained that I was the 4th. owner of my vessel and that I had purchased the boat in 2007 from a UK resident on Hayling Island .

All the previous 3 owners were all resident in the UK and they kept the vessel in UK waters at all times. I stated that I am a Guernsey resident living in a non-EU country and that my boat is permanently moored in this island.

I am therefore termed as the original exporter from the UK. Apart from routine maintenance and repainting, no major alterations have been made to the vessel during my ownership.

( the above are important factors. You have to prove that you are the original exporter, that you have retained ownership, and that no major changes have been to your vessel to retain the VAT paid status).

I further stated that I understood that the correct procedure for me visiting UK waters remains the same with me completing the necessary C1331 forms (see HMRC website) and notifying the National Yachtline prior to leaving Guernsey  with my date of arrival in the UK and later the date of departure when leaving UK waters.

However, if I decided to sell my boat at a later date to a UK resident, I must be the person who delivers the vessel to a UK port to avoid additional VAT for the purchaser.

Alternatively, if I wanted to sell the boat to a Channel Island resident and for them to retain the UK VAT Paid status, I would be required to bring the boat into the UK, transfer the ownership to the new owners on UK soil and they would then re-export the vessel back to the Channel islands under their command. i.e. they would then technically be the original exporter of the boat.

Although this sounds complicated, it isn’t really as long as you’ve got all the necessary paperwork and proof of VAT paid status in your possession.

Lorna replied by email with confirmation that if I was to sell the vessel in the UK it would retain its UK VAT paid status and that the new owner could then sail it to the Islands and be able to return to the UK without losing the VAT paid status at any time. For all arrivals into the UK , a C1331 must be completed and a call required to the National Yachtline on 08457231110  to advise that you will be claiming returned goods relief.

I hope you may find this useful. It certainly makes a difference when selling your boat!

Nick Guillemette