The Buyer Journey: Taking the right tax advice
A practical guide for owners seeking transparency and efficiency from the tax advisory sector…
Historically, it might be said that yachting operated beneath the radar of the tax inspector. Being transient entities, it was hard to apply the rules of multiple jurisdictions to the sale, purchase and operation of a yacht. These days are, thankfully, firmly behind the industry, and there is a homogenous acceptance that it must be paid.
This has been driven by both the scrutiny of legislators and a change in attitude, and has resulted in the terms ‘due diligence’ and ‘best practice’ being more applicable to the upper echelons of the tax advisory landscape than perhaps any other sector. Owners now rely upon the transparency and efficiency of the tax advisory sector, but must also take the right tax advice in the right situation from the right person.
“When seeking tax advice, owners, or their private office representatives, may go to an advisor in a specific jurisdiction with a specific problem or query,” explains Nic Arnold, Tax Director – PwC Private Client. “Often there isn’t time to do anything else. Further down the line, a new question arises and an answer is found that keep things ticking along. But where things can start to go wrong is when there isn’t a full understanding of why the question needed asking in the first place, and why the answer given was the right answer for them,” Arnold continues.
If a yacht is used for multiple purposes, for example, private initially, then commercially, and when a yacht moves in and out of the EU, its ‘tax profile’ may well become unclear to any custom authorities analysing it, and owners, or owner representatives, need to be aware of this.
"As trite as it may sound, it really has never been more important for buyers to take the right tax advice" - Adam Ramlugon, Partner – Hannaford Turner
“As trite as it may sound, it really has never been more important for buyers to take the right tax advice,” agrees Adam Ramlugon, Partner – Hannaford Turner. “I am not just talking about VAT, although this remains a crucial issue. I have argued for some time that the superyacht market, although not the focus of any nation’s political agenda, would increasingly feel the regulatory constraints of economic policies aimed at increasing the tax take across the world.
“The policies of restraint and austerity that followed 2008 are unlikely to be followed again, which is likely to mean only one thing. Efforts will be made to increase tax receipts both by tougher enforcement of existing tax rules and by the implementation of new ones,” Ramlugon adds.
Obtaining the right tax advice from persons who are qualified to provide it is perhaps of most interest to owners when considering the possible financial repercussions of listening to the wrong person. “While tax may, at times justifiably, appear to be an increasingly complex and tiresome aspect of purchasing a yacht, the truth is that guidance from reputable experts goes a long way in ensuring that all points are covered,” comments Alison Vassallo, Partner - Fenech and Fenech Advocates in Malta, and heads the Yachting Department. “It may also avoid costly repercussions further down the line, Vassallo emphasises.
The Superyacht Buyer Report provides a comprehensive reference tool for any client and their advisory team throughout the buyer’s journey. The report features 16 sequential chapters that outline this journey, with respected experts from every sector advising on best practice at each stage of the ownership process. Above are a selection of extracts from the sixth chapter – ‘Taking the right tax advice’ – which clearly defines how to do exactly that.
To read the ‘Taking the right tax advice’ chapter in full, please click here.
Profile links
Click here to become part of The Superyacht Group community, and join us in our mission to make this industry accessible to all, and prosperous for the long-term. We are offering access to the superyacht industry’s most comprehensive and longstanding archive of business-critical information, as well as a comprehensive, real-time superyacht fleet database, for just £10 per month, because we are One Industry with One Mission. Sign up here.
Related news
A buyer’s guide to the 50-60m motoryacht segment
Lifting the lid on one of the superyacht market's most nuanced size segments
Fleet
A buyer's guide to the 40-50m motoryacht segment
Offering clarity on the market's most dynamic sector
Fleet
The Buyer Journey: The role of lawyers
Explore the role that superyacht lawyers play in the buyer journey and how they negate errors, as well as litigate them
Owner
The Buyer Journey: The buyer checklist
The buyer checklist provides a list of key considerations any client should make during the buying process
Owner
The Buyer Journey: Finding the right advisor
A reference tool for prospective superyacht buyers looking to set up a trustworthy advisory network
Owner
A buyer’s guide to the 30-40m motoryacht segment
Outlining the nuances of the industry’s most prolific sector and highlighting considerations for buyers
Fleet
Related news
A buyer’s guide to the 50-60m motoryacht segment
4 years ago
A buyer's guide to the 40-50m motoryacht segment
4 years ago
The Buyer Journey: The role of lawyers
4 years ago
The Buyer Journey: The buyer checklist
4 years ago
A buyer’s guide to the 30-40m motoryacht segment
4 years ago