Tax advantages lure yachts to Croatia

Yacht owners who are yet to pay European Union value-added tax (VAT) on the purchase of their yachts, and who wish to put their vessels into free circulation in the European Union, have been encouraged to temporarily register their vessels in Croatia to take advantage of a concessionary value-added tax rate being introduced ahead of the nation's entry into the European Union on July 1, 2013.

Under EU law, yachts that have been purchased in the European Union are subject to value-added tax, at varying rates permitted by the European Union.

Once VAT has been paid on a yacht it may be transferred from one EU member state to another free from incurring any additional VAT, as with other goods that travel across EU frontiers, tax-news.com reports.

Croatia is set to join the European Union from July 1, 2013, and Croatian yacht owners, under the rules, will be required to pay value-added tax on their vessels to establish them as EU goods.

Croatian yacht owners may opt to instead relocate their vessels to another European Union member state ahead of the nation's accession and pay VAT there instead.

(Source: Google News: Croatian Times. View the original story here.)