Crazitaly! New VAT Rules Instantly Postponed!

Sanremo, July 21st 2020

It has all the makings of being an endless story.

Yes, Italy has changed his mind again!

Contrarily to what we have informed you about this past 16th June 2020 (see here for more info www.yachtwelfare.it/new-rules-in-italy) the new VAT rules (VAT at 22% due on actual time spent into EU waters) have unexpectedly been postponed to 1st November 2020.

The Italian Minister has now decided – with a huge delay – to follow in the footsteps of the French Finance Minister and so to suspend until 31st of October the application of the new VAT rules in order to revitalise the yachting industry, especially after the recent situation of COVID-19 pandemic.

So let’s keep the old rule (e.g. 6.6% flat-rate reductions on Charter Fee) with the purpose of implementing the Charter activity for the current summer season encouraging (is anybody feeling encouraged now?) tourists to come to Italy.

The above is part of the last “Simplification Decree” N. 76/2020 published on the Official Gazette (Gazzetta Ufficiale, Serie Generale N. 178 del 16/07/2020, Suppl. Ordinario N. 24), entered into force on July 17th 2020 (in which the word “April” – contained in subparagraph 726 of Law 27/12/2019 N. 160 – has been replaced by the word “November”).

Please inquire us to info@yachtwelfare.it for any questions and additional info.

We remain at your disposal.

Staff Yacht Welfare



New Rules in Italy

Sanremo, today 16th June 2020

As you all know, this past 25th May 2020 the Italian Revenue Office (Agenzia Delle Entrate) has put under Public Consultation (for more info see our news on 27th May 2020 here) a draft concerning the provisions for the application of the VAT reduction on Italian charters, according to the EU’s articles 56 and 59 of the EU VAT Directive 2006/112/CE.

The new regulations have been finally issued with Provision N. 234483/2020 by the Italian Revenue Office.

Therefore, as of yesterday, June 15th 2020, the VAT due on Italian charters must to be calculated on the basis of the actual time spent by the charter into the EU territorial waters.

As a logical consequence of this, the taxable amount will be subject to a pro-rata reduction based on the cruising outside the European territorial waters (international waters), according to the real time miles spent at “high sea” (international waters), in accordance to the hereinbefore mentioned article 59.

The new rule does not apply to any Italian charters signed before 15th June 2020 (date of release of the official Provision by the Agenzia Delle Entrate).


What do we need to do now on?

To put it quite simply:

Firstly Captains/Officers on board need to split the Charter time into two parts:

a. total hours spent into EU Waters (Italy, France, Spain, etc.).

b. total hours spent at the High Sea (International Waters).

Secondly, and particularly important, the following evidences/proofs must be collected, kept on file and submitted in case of inspections by the Authorities:

1. trip route cartography.

2. data/info extracted from satellite and/or navigation systems.

3. data/info extracted from transponder systems (e.g. AIS system).

4. logbook (ship’s log) and/or navigation log.

5. papers attesting any berth stay in non-EU ports (e.g. berth invoices, berth contracts agreements, arrival/departure formalities, etc.).

6. papers attesting any purchase of goods and/or services in non-EU shops/businesses.

7. the short-term Charter Agreement and/or analogue Contracts regarding the hire of the yacht.


The evidences collected must prove the maritime routes sailed by the yacht with extreme accuracy and coherence.

All the evidences/proofs collected must be kept on file for a period of time according to Art. 57, paragraphs 1 and 2, of the Presidential Decree N. 633/1972 (therefore, until 31st Dec. of the fifth year subsequent to the year in which the Declaration has been filed or – in the event that the Declaration hasn’t been filed – until the 31st Dec. of the seventh year subsequent to the year in which the Declaration should have been filed).

To simplify the procedures and reduce the burden we – at Yacht Welfare – have set up a special form for all our Clients to summarize all the necessary data and info. This form is called PPNRF (Passage Plan & Navigation Report Form) and it is made in editable pdf file.

The PPNRF needs to be fulfilled in all its parts and sent back to us along with the necessary pictures, mini videoclips, logs, etc. annexed.

Yacht Welfare will keep assisting you by double checking the info provided.

Please feel free to inquire the PPNRF form emailing us to info@yachtwelfare.it



Public Consultation for VAT on Charters

Sanremo, today 27th May 2020

Following to our news released on 19th December 2019 (see here for more info: www.yachtwelfare.it/vatreduction) this past 25th May 2020 the Italian Revenue Office (Agenzia Delle Entrate) has finally put under Public Consultation a draft concerning the provisions for the application of the VAT reduction on Italian charters, according to the EU’s articles 56 and 59 of the EU VAT Directive 2006/112/CE.

The most credited method to calculate the actual VAT due would seem to be a pro-rata reduction based on the cruising outside the European territorial waters, according to the real time or to the actual cruising miles spent at “high sea” (international waters), in accordance to the hereinbefore mentioned article 59-a.

Therefore, the main focus is to find and agree the list of papers, equipment and methods to determine the actual use of the yacht outside the EU territorial waters and so the exact VAT due in Italy.

This Public Consultation can be found at this link https://www.agenziaentrate.gov.it/portale/web/guest/consultazione-pubblica-del-25-maggio-2020 and it will be open to the professionals’ review and contributes until 3rd June 2020.

After this date, finally, the new law will come into force only from its official publication.

This also means that any charter signed before the official publication of the new law will be subject to the old legislation (e.g. 6.6% flat-rate reductions on Charter Fee).

Anyway there’s still the chance that the Italian Minister will decide to follow in the footsteps of the French Finance Minister and so to suspend until 2021 the implementation of the new regulation in order to revitalise the yachting industry, especially after the recent situation of COVID-19 pandemic.

We will let you know about the progress of this long-awaited decisions as soon as possible.

Stay tuned with us in the forthcoming weeks to know and assess the developments.

For any additional info or clarifications required please email us to info@yachtwelfare.it.



Italy is sailing again!

Italy is sailing again! With his last DPCM (Decree of the President of the Council of Ministers) released on May 16th 2020 the Italian Prime Minister expressly authorised the possibility to sail in Italy within the region of residence. This rule will last until 2nd June.

As of June 3rd 2020 the regional limit will fall and it will be possible to freely sail around all the Italian coasts.

Also – not less important – from this date June 3rd) the Italian Government will reopen the borders to all EU citizens without the need to spend quarantine periods.

This is the clear sign that the Mediterranean summer 2020 is finally started.

The charter sector has received the go-ahead for the measures to be taken for the resumption of the charter activity.

These measures consist in very simple procedures, most of which are now widely known to everyone.

Firstly it has been confirmed that a COVID-19 test will be required for the charter’s permanent crews, who will need to deal with many different guests, especially on large yachts.

Secondly the Ministry has pointed out that in pleasure yachting the individual responsibility is the essential element in making social distancing measures effective, therefore:

a. interpersonal distance of at least one meter

b. avoiding close contact

c. proper sanitization of spaces

d. nose and mouth protection for passengers

We must make it clear that the rules published by the Ministry regard pleasure yachting, chartering, renting as well as the management of ports and marinas.

Below you will find the key points to respect when sailing in Italian waters.


PRIVATE / PLEASURE YACHTS

The primary measure remains the “social distancing”. As you all know this means that persons need to stay at least one metre from each other, unless they are part of the same family or live together.

Even the relatives, if not living together, must respect the social distance of one person for each linear metre of the boat. The provision of personal protective equipment for passengers and the use of surface sanitizer are also mandatory.


COMMERCIAL / CHARTER YACHTS

The same preventive rules for private vessels apply to yachts engaged in charter activities. Only persons living in the same family are allowed to stay together in the same cabin.

The owner is required to sanitize all the yacht’s areas, including the engine room and services. Owners are also obliged to provide adequate supplies of sanitizing products as well as information signs, written in several languages, to make the charterer and his guests aware of the necessary social and hygienic measures to take.

Certain specific measures must be adopted by the crew; let’s see which ones.

Firstly crews have the obligation to use masks and gloves and any other protective equipment depending on the type of the boat and the particular circumstance, for instance during mooring, unmooring, bunkering and towing operations.

Also crews – being called in some cases to carry out first aid actions (as in the case of the Captain for whom the elementary first aid course and BLS is compulsory) – there should be the obligation to undergo a preventive (before boarding the yacht) and periodical first aid test at COVID-19, the result of which must be duly kept on board.

Further for each member of the crew is mandatory the measurement of the temperature on a daily basis.

The crew must also implement the prevention of unauthorized access to the ship to strangers, while in port or at sea.

Those who generally live in the same house are allowed to share accommodation in the same cabin.

What about guests?

Also for guests the general rules on social distancing and interpersonal prevention measures apply (i.e. one person per meter of the linear length of the boat, including crew members, unless the guests live together).


TOURIST PORTS AND MARINAS

The managers of Italian marinas must provide their ports with special information signs, written both in Italian and English language, on the measures of conduct to respect, the use of personal protective equipment (PPE/DPI), the installation of sanitizing dispensers on the docks, the limitation of movements, bans on gatherings and the respect for social distancing.


NAVIGATION AND SYSTEM RULES

It is mandatory to comply with the regulations for travel within the Region and between Regions and the respect of international anti-contagion laws during navigation outside national territorial waters.

As this is changing for the better day-by-day we strongly recommend all of you to stay tuned to our website www.yachtwelfare.it/news to know the latest updates.


WHAT ABOUT VAT?

For what is concerned to the VAT due on Italian charters, UCINA (Confindustria Nautica, the Italian Marine Industry Association) is still dealing with the Italian Authorities to postpone the application of the new law (see here for more info www.yachtwelfare.it/somegoodnews). Everything leads to the hope that Italy will quickly join the decision taken in France, repealing the provisions contained in the new law and giving continuity to the old flat rate reduction percentages scheme (i.e. taxation at 22% on 30% of the agreed Charter Fee for yachts over 24 metres, equal to the “quick” rate of 6.6%) in order to guaranteeing “certainty” for operators in the yachting sector, especially now that they have just started their activity again after this extraordinary situation and encouraging yachts to come to the Mediterranean for the charter season.

Please know that the old legislation (flat-rate reductions on Charter Fee) will still be effective in Italy until the publication by the Italian Tax Office of appropriate provisions containing the clear list of methods and means suitable to demonstrate the effective use of the service outside the European Union.

For any further info or questions please email us to info@yachtwelfare.it

We remain at your disposal

Staff @YACHT WELFARE



Some Good News!

Sanremo, 31st March 2020

We have received a press release issued by the French Nautical Federation (FIN). You will find here below for your review an in-house translation.

The press release states that the French government has agreed to postpone the application of the new tax regulation related to charter hire (VAT due on the exact time of navigation in EU waters and the abolition of the 50% lump sum reduction).

This certainly would come as great news to our industry during these difficult times however we are waiting for the official confirmation to be issued from the French government in this regard.

Please find below the translated text from the FIN’s press release:

PRESS RELEASE | 25 March 2020, Paris

Applicable VAT Regime on charter hire: the Federation obtains a postponement of the new measure.

Following constructive contacts with the office of the Minister of the Economy, the FIN informs the professionals in the nautical sector of the suspension of the reform project aimed at modifying the 50% lump sum VAT reduction that applies when navigation outside the territorial waters of the European Union occurs during a charter.

“For several months now, we have been working in close coordination with the Government services on this subject. Until the Covid-19 crisis, we were moving forward on a common position with our Italian counterparts. This work will resume after the health crisis. We have pleaded with the government for the suspension of the measure that should have applied on 1 April. This is a relief today. This decision should be made official in the next few hours,” said Yves Lyon-Caen, President of the FIN

In the light of this the French Finance Minister has cancelled the implementation of the new regulation (see more here) due to the current situation of COVID-19 pandemic.

As the changes made to the conditions for determining the taxable base have been withdrawn, the VAT lump sum reduction (20% on 50% of the charter fee) is still applicable in the case of cruising in international waters (BOI-TVA-CHAMP-20-50-30).

For what is concerned to Italy the UCINA Confindustria Nautica is currently dealing with the Italian Authorities to do take analogous measures and therefore to postpone the application of the new rules in order to keep the old taxation law for all Charters to execute during season 2020 (taxation at 22% on 30% of the agreed Charter Fee).