Neil wrote:
The only savings for UK private buyers are with UK VAT paid aircraft.
… if bought from a private seller – if bought from a VAT-registered company you still have to pay it…
This means that for a UK buyer looking at mainland europe the VAT status is meaningless, it’s the same as buying from the USA. budget 20% VAT on import.
Exactly.
As an aside I can never understand how so many small aircraft are for sale “plus VAT”.
As I wrote above:
Basically there are two markets for used planes: no-VAT, and plus-VAT. The former are of interest to Joe Public. The latter are of interest to VAT registered operators. And the prices differ.
So a TB20 for sale by a private owner (who, or someone before him, took the VAT hit) might be 120k, while one for sale by a VAT regd company would be 100k+VAT which is obviously more attractive to a VAT registered buyer.
As to why “so many”: quite a lot of planes, especially upmarket ones, are owned via companies. Often the company has no business activity, although – the syndicate liability limitation scenario being an exception – there is generally no benefit in doing that unless the company is at least renting the plane out to 3rd parties (long story; search EuroGA on e.g. BIK). A lot of the time, Joe Bloggs sets up a company called Bloggs Aviation Ltd and buys the plane through that 
There are also issues with that, via the CAA imposing some maintenance requirements, in theory…
If I wanted to sell a VAT exempted N reg plane that I flew over from the States as a returning citizen. Can that exemption be transferred to a buyer?
That plane/car/boat is in free circulation after a year, at least in Poland, so yes, after that year passes you can sell whatever you brought in as personal possessions and the paperwork is all good.
You surely signed a paper that you are not selling it soon (X months or years) before getting VAT & duty exemption on your personal belongings after changing residence? what was written there?
Is there any way to find out the VAT status of a plane on EASA registry (since the 70‘s)? Or does „good faith“ apply (considering it „imported“ due to decades of being registered in EU)?
In the UK, you can’t. Up to around 2005, it was possible to send supporting docs (invoices etc) to a Customs office at Southend and they would issue a Certificate of Free Circulation. That unit then got shut (or they stopped doing this) and I got one of the last ones, via an ex Customs consultant who charged about £200 for the service. He is still in business AFAIK.
It is probable that other countries have/had a similar service, so if you have some documents (e.g. an invoice from the 1970s) this route may exist for you. The Danish 0-VAT route similarly delivered an EU Certificate of VAT Paid. Germany and Italy were not too happy about that.
I have never heard of a general “VAT paid” registry, although it has been claimed that a certain countries’ CAA will not register an aircraft unless it sees evidence of import VAT paid. Germany was one of these, IIRC, in which case a D-reg could never have its VAT status questioned. This search digs out a fair amount of reading.
BUT even if (say) Germany was doing that, you would still lose the VAT paid status if the plane physically left the EU for some time (generally 2-3 years, IIRC, and it could do that without changing its reg or even ownership) so to be sure you really need both the proof of initial VAT paid and a continuous journey log record. And it would render any “VAT paid registry” useless.
In fact I think that if you sold this D-reg to Jersey (or to the US, etc) and it stayed there for 1 week and then came back to a German owner, it would have already lost its VAT paid status. Someone who used to be here got busted by UK Customs for exactly this, although it was a bit longer than 1 week…
Peter wrote:
BUT even if (say) Germany was doing that, you would still lose the VAT paid status if the plane physically left the EU for some time (generally 2-3 years, IIRC, and it could do that without changing its reg or even ownership) so to be sure you really need both the proof of initial VAT paid and a continuous journey log record. And it would render any “VAT paid registry” useless.
But the same would apply if you have a Certificate of Free Circulation, would it not? So the CFC you have would also be useless without a continuous journey log record.
Yes that is very true.
The difference is whether the tax authority will easily find out. They can’t generally access aircraft sales records; these are not centralised anywhere. Obviously, UK HMRC could get data from the UK CAA on transfers away from G-reg, and then check G-INFO on whether they came back, but this would be hellishly controversial to do officially, even though the number of people who have a “CAA login” is pretty large. Similarly, UK HMRC, and AFAIK other tax authorities around Europe, purchased data stolen by a Swiss bank employee and legitimately used that, so there is a precedent. The guy who I mentioned got busted had accidentally disclosed, during a (presumably routine) VAT inspection of his business, that his (always G-reg) spent time on Jersey.
However, from the POV of airport police (who especially in some countries are rarely chosen for their penetrating investigative skills) having a CofFC to show them, is an excellent line of defence
AFAIK other tax authorities around Europe, purchased data stolen by a Swiss bank employee and legitimately used that, so there is a precedent.
The purchased data wasn’t used in court convictions but rather as a targeting tool. The fiscal authorities still had to put the investigative legwork in. Not about what you know but about what you can prove, fruit of the poisonous tree and all that.
