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French Commercial Exemption “FCE” Rules

posted by Darryl Sharman

Yachts registered as Commercial and used in French waters may be considered VAT exempt providing they comply with the regulations announced in May 2004.

This article should be read in conjunction with the latest update relating to Clarity on High Seas Charter published in October 2015.

These yachts may only be used for this purpose with a permanent crew, a charter contract in place and evidence of a realistic charter fee having been paid. Mixed commercial and pleasure use is not permitted. A beneficial owner may charter his/her yacht, but excessive use may be interpreted as Demise Charter and contrary to the rules.

In summary, provided the yacht is:

–  Permanently available for ‘high seas’ charter
–  Fully provisioned
–  Permanently crewed
–  Commercially registered

then one may not need to be concerned with VAT on hull value. 

 

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