18-month temporary admission for yachts: sailing in Europe without import or VAT

In Europe, under certain conditions, a pleasure boat can sail in EU waters without paying VAT. These conditions are defined by the Temporary Admission regime, also known as “AT 18 months“.

What is 18-month temporary admission for yachts?

Temporary admission is a customs procedure provided for under European regulations (EU Customs Code, Articles 250 to 253 of the CDU and its implementing provisions).
It authorizes yachts registered in a non-EU country to stay and sail in European Union waters for up to 18 months, without having to pay VAT or import duties.

This system provides a framework for the circulation of foreign yachtsmen in French and European waters, and encourages international nautical tourism while ensuring customs traceability.

When should the 18-month temporary admission scheme be used?

The temporary admission system is particularly well suited to several typical situations encountered by yachting professionals:

• When the owner or manager of a non-EU registered yacht wishes to sail in European waters for a season or a private cruise.
• When a vessel is engaged in an international and cross-border itinerary without change of ownership or commercial purpose.
• When the yacht is stationed in the Mediterranean and operated for strictly private purposes during the season.
• When the owner plans to sell the yacht outside the European Union at the end of the European sailing season.
  Please note: The sale of a yacht under AT in the EU is subject to normal taxation (VAT & duties).

This regime is a valuable solution for optimizing the tax and administrative aspects of temporary navigation in Europe, as itavoids the need to import the vessel and the associated tax burden, notably the 20% VAT.

Please note: Renovation work or major repairs typically require either another customs procedure (temporary admission for inward processing ), or other specific authorizations.

Conditions of eligibility for the 18-month TA for yachts

Four conditions must be cumulatively met to benefit from the 18-month TA:

1. The yacht must be registered under a pleasure flag outside the European Union.
2. The owner, whether a natural or legal person, must be established for tax purposes outside the European Union.
3. The vessel must be exclusively intended for pleasure, private and leisure use. The boat must not have a trade flag (except for “YET – Yacht Engaged in Trade” flags, see below) and must not be engaged in any commercial or profit-making activity. For example, it may not be offered for charter. The boat must not be intended or offered for sale.
4. All vessel users must also be non-EU residents.

Non-compliance with any one of these conditions may result in the regime being called into question and the vessel being taxed immediately.

Except in special cases, the temporary admission period cannot exceed 18 months. To find out more, please contact us.

Why formalize with a temporary admission document?

Even if the right to temporary admission derives directly from compliance with the conditions, it is strongly recommended that this status be evidenced by an official document. This document, issued by French customs, offers several advantages:

• It provides tangible proof of the ship’s customs status and clearly sets out the 18-month time limit.
• It facilitates navigation, by securing controls at ports of call.
• It is recognizedthroughout the European Union.

That’s why yacht captains and owners are well advised to keep this customs document on board, to protect themselves in the event of any checks.
It is obtained by submitting form CERFA 15678*01, together with supporting documents: registration certificate, proof of ownership, insurance, proof of residence outside the EU. In some cases, a financial guarantee may be required.

Special cases and points to watch out for

Yachts in commercial operation (YET)

Certain flags, such as the Marshall Islands or the Cayman Islands, offer a hybrid status:“Yacht Engaged in Trade” (YET), which allows for a limited commercial activity without affecting the TA for private use. However, this option excludes exemptions on fuel or supplies, except in specific cases (repairs under inward processing).

Buying or selling a yacht under AT

Temporary admission is attached to the owner, not the vessel.

If you buy a boat under the temporary admission regime, you must do so outside European waters to avoid any reclassification as an import.

Then, if you comply with the conditions of temporary admission, you can return to European waters, and claim to obtain a new temporary admission document.
For more details on these stages of sale and return with temporary admission, please contact us.

New in France: simplified 18-month TA clearance

At the end of the 18-month period, the vessel under temporary admission must:
– either be placed under another appropriate customs procedure,
– or physically leave the territory of the European Union.
It is normally necessary to reach a port in a third country to discharge or renew a period of temporary admission. This is known as “classical” discharge.

Harmonization with practices in Spain and Italy has recently lifted this requirement in France:

• It is no longer necessary to carry out a “third-party touch” in a non-EU port to renew the 18-month VAT exemption.
• Discharge can be carried out via a protocol for exit within 12 nautical miles, validated by French customs.

Please note that this protocol requires prior validation, and cannot be improvised. A customs representative can help you put together the file, guarantee its conformity and validate the protocol with a competent customs office.
A procedural error can be very costly!