Italy Yacht Charter VAT

When we plan a sailing holiday in Italy we have to get informed about the VAT and the rules that manage it. Below all the informations you have to know before your yacht charter, in order to enjoy it relaxing, without worries. 

The VAT is a form of consumption tax. 

Points of view:

– For the seller, the vat is a tax only on the value added to a product, material or service, from an accounting point of view, by this stage of its manufacture or distribution.
– The manufacturer remits to the government the difference between these two amounts and retains the rest for themselves to offset the taxes previously paid on the inputs.

The value added to a product by or with a business is the sale price charged to its customer, minus the cost of materials and other taxable inputs. A VAT is like a sales tax in that ultimately only the end consumer is taxed. It differs from the sales tax in that with the sales tax, the tax is collected and remitted to the government only once, at the point of purchase by the end consumer. With the VAT, on the other hand, collections, remittances to the government, and credits for taxes that are already paid occur each time a business in the supply chain purchases products.

What we really have to know about the Italy yacht charter VAT? Why the value added tax changes if we navigate in Italian waters and if we not?

Compliance with VAT is easier than it looks: a yacht is just a means of transport which can be exploited for the purposes of providing service, so it can be exposed to the Value Added Tax. 

The standard VAT rate in Italy (Article. 40, co. 1-ter of Legislative Decree 98/2011 has introduced the following important change: With effect from 1 October 2013, the rate of VAT of 21 percent is restated to the extent of 22 percent) is the 22%. This value is applied only to charter fees if the yacht cruises only in Italian/EU territorial waters. If a yacht cruises both within and outside EU waters, VAT is due only on the charter fee in proportion to how much time is spent in EU waters compared to the entire charter period.

VAT – Clarifications regarding Territoriality and Taxation of Operations related to the Pleasure Boat Industry:

1. Use of recreational craft within the territorial waters Community:

In the case of provision of recreational craft in the State, in order to determine the period of use of the same within the Community territorial waters, wonders whether the alleged use of flat rates within those waters provided by circular no. 49 of 7 June 2002 as well as clarifications contained in Circular. 38 of 22 July 2009, are still applicable both while lease, rental and similar recreational craft to. As in the case of short-term lease, also financial, rental and long-term.

2. Short-term rental and availability of the boat in the territory of another State Member of the European Community:

In case of short-term rental of a boat in the territory of another State Member of the UE, are these performances excluded from Italian  VAT?
The performances of short-term lease of means of transport (financial, rental and similar) are considered territorially relevant in Italy. Such benefits shall be regarded as within the state when the means of transport “are made available to the recipient in the territory of that State and if they are used within the territory of the Community” and also “when the means of transport are made available to the recipient outside the territory of the Community and are used in the State”.  The provision of short-term rental and availability of the boat in the territory of another Member State of the Community is not mentioned among those that the rule qualifies as territorially relevant in Italy.

However, since it is not possible to determine exactly how much time will be spent within and outside EU waters prior to the charter, Circular no.49/E of 07.06.2002 issued states that the time spent outside Italian/EU waters may be quantified as a ‘package’.

Now that you got more information about the Italy Yacht Charter VAT and its application and you’re ready for your trip to Italy, take a look at our sailing and motor yacht fleet. Fill out the form with your preferences and receive immediately our best solutions.