Yachting has always been viewed as a luxury activity in Spain and boats have been subjected to high taxes over the years. The current system levies a matriculation tax of 12 per cent on the value of boats. However this is strictly only applicable to Spaniards; those who are non-tax residents in Spain can easily avoid this tax.
When buying a boat in Spain we should firstly distinguish between a brand new and a second-hand yacht, where it is going to be registered and under which flag. The tax consequences are different depending on the port of registration, but for the purpose of this article we are going to suppose the boat is purchased, and registered, in Spain.
Buying a new boat
A brand new boat, over 8m length, purchased in Spain and registered under the Spanish flag will be liable to VAT at 16 per cent and Matriculation tax at 12 per cent, both calculated on the value. These taxes are not avoidable for Spaniards.
However for non-residents in Spain there is a route to avoid the payment of these taxes, but it is dependent on whether the purchaser is an EU resident or from outside the EU.
Under the scheme called “matricula turística”, a non-Spanish resident from another EU country will benefit from exemption on the matriculation tax, therefore avoiding the extra 12 per cent although VAT must be paid. If the buyer is from outside the EU, the total amount (both the matriculation tax and VAT) will be exempt.
The only restriction is that the boat cannot be used for more than six months in any one year in Spanish waters.
Buying a second-hand boat
If the purchase is a second-hand boat it is important to formalise the transaction by drawing up a contract showing all the circumstances of the purchase, such as price, payment, inventory, etc.
This contract is considered the title of ownership and will act as a guarantee in the event of possible undetected problems with the boat. If the transaction takes place between non-professionals, i.e. no broker or agent is involved, the seller has to guarantee the boat for a period of six months. If these problems are not detected by the buyer prior to the transaction taking place, but are detected within a six month period, the buyer can ask for a price reduction or terminate the contract.
If the seller is a professional, the law establishes a minimum period of two years warranty. It is possible to arrange to reduce the period of warranty to one year, but it is up to the broker to negotiate this with both parties.
Depending on whether there is a middle man the tax liability differs. If the seller is not a professional then there is a compulsory charge of ITP tax at a 4 per cent rate on the value of the boat, according to an official list published by the Spanish authorities. This list of boat values is published annually taking into consideration the make, year and model. If the seller is a professional the transaction will be subject to VAT.
If the transaction takes place between two individuals, but the buyer is non resident in Spain, the transaction will be tax exempt in Spain.
It is important to note that when a boat is taken to another EU country, VAT need not be paid again provided it can be proved that is has been paid previously. This acknowledgement document is called “hoja de asiento” issued by the Marine Administration.
Finally, it is important to note that Spain can be a tax efficient country for the introduction of new boats arriving from outside the UE considering the lower 16 per cent VAT rate than neighbouring countries.
In Spain, compared to France or Italy, banks are not allowed to sell their commercial products such as a leasing agreement when there are tax benefits concerning VAT. However it is possible to contract these products through subsidiaries of foreign banks. In these circumstances the buyer can benefit from reduced VAT rates along with an improved financial package.
Once the purchase of a new boat has been completed registration process is the next stage. This procedure is the responsibility of “Capitanias Maritimas”. If the vessel has the CE mark, the procedure is quite straightforward. However we must bear in mind that it is always difficult to deal with these administrations and of course no English is spoken.
For new boat registration the required documents for the registration process will be the bill of sale, the owner’s manual, proof that taxes have been paid, conformity declaration and notified body certificate for the hull and engine. The boat also needs an MMSI code necessary for all the safety devices and navigation equipment. You also need to notify the area that you intend to cruise.
For second-hand boats, the required documentation to log the change of ownership will be the contract. This contract with the duty stamp, called ITP, is sufficient to effect this change.
If the boat is to be registered in another country it will be necessary to apply for a flag deregistration in Spain. This procedure has to be done by the buyer or the seller in any of the above mentioned Capitanias Maritimas.
Registry of movable properties
It is important to mention as well, that some boats might be enforced to register in the Merchant Register. This applies if the boat has been financed with a mortgage or a leasing agreement, and in this case it is compulsory. This is to establish proof of ownership and title on the craft vis-à-vis third parties.
Spaniards or permanent residents are required by law to take an exam and qualify in order to be allowed to skipper and sail a boat. The difficulty of the exam varies depending on the type of boat we want to sail.
However, non-residents, as long as they maintain this status, are allowed to obtain temporary permission granted by the Capitanias. This permission is given for a period of three months and needs to be renewed by the same Capitanias who issued the permission in the first place.
Finally a quick reference to insurance; according to the RD 607/1999 every boat over 6m length put in the water is required by law to obtain civil responsibility insurance. Not complying with this requirement involves a hefty fine if caught.
Editor’s Note: Alex Chumillas is an economist specialising on tax issues and recently participated as speaker in the Future of Super Yacht conference in Majorca. For more information contact iurismarine.com (site is in Spanish).