Brexit is the true old live story. Its effects are the new reality, our imposed boon companion.
The UK ceased to be part of the EU as of 31 December 2020. The EU-UK Trade and Cooperation Agreement has been in force since then, but the relationship in terms of market access conditions is very different from the UK’s previous participation in the EU.
With yachting and aviation now, the risk is import duty and/or import VAT. The first set of questions that arose was the customs status of existing yachts and aircraft. If a yacht or aircraft was located in the EU, or released for free circulation there when Brexit happened, then it was deemed to be ‘EU goods’. It was not subject to import charges, irrespective of where the yacht or aircraft was registered. By contrast, if a yacht or aircraft with the customs status of EU goods was in Great Britain (excluding Northern Ireland) then it lost that customs status of EU goods, meaning it became subject to import charges on return to the EU.
Keeping or losing customs status like this, based on location when Brexit happened is a straightforward legal principle of the EU – and vice versa the UK. But it is not so simple. A common mistake is to presume that the customs status of EU goods will apply automatically. It does not. Owners are required to prove EU goods status to the customs authorities, especially when their yacht or aircraft leaves or re-enters the customs territory of the EU.
The second set of questions asks what customs and tax procedures should apply to yachts and aircraft when they leave or re-enter the EU. Yachts and aircraft, particularly those with the customs status of ‘non-EU goods’, are subject to customs procedures in the EU. They are liable to import charges, unless they are relieved under the conditions of an appropriate declaration procedure such as Returned Goods or Temporary Admission. These procedures are not new in themselves. Brexit has merely expanded their use.
In the circumstances, it seems the distinction in customs status between EU and non-EU status post-Brexit can only be made following necessary customs checks. That can seem burdensome. And yet, presuming that customs formalities do not apply, or avoiding formalities altogether, can be worse. In normal times yachts and aircraft can be declared by “the sole act of crossing the frontier”. But, with Brexit, owners who presume that basis may struggle with the evidence required to prove their status when challenged by the authorities.