Reply
 
Thread Tools Search this Thread Display Modes
 
Old 07-28-2022, 02:11 PM   #1
PPD
Veteran Member
 
City: Mystic
Join Date: Jul 2020
Posts: 28
International Boat Purchase

Good afternoon all,

I'm getting close to purchasing a boat that is located in Bermuda and bringing it back to the States (CT to be exact). What hurdles or problems should I anticipate in executing this transaction and what is the process that I should expect? I have never purchased a boat internationally, so any words of wisdom are welcome.

I know not to move the money until title and documentation is in my hands.

Thanks
PPD is offline   Reply With Quote
Old 07-28-2022, 02:17 PM   #2
TF Site Team
 
Comodave's Avatar
 
City: Au Gres, MI
Vessel Name: Black Dog
Vessel Model: Formula 41PC
Join Date: Jul 2015
Posts: 16,837
There are brokers that deal with this. I would find one and ask them.
__________________
Boat Nut:
If you are one there is no explanation necessary.
If you arenít one, there is no explanation possible.
Comodave is online now   Reply With Quote
Old 07-28-2022, 08:11 PM   #3
Guru
 
kchace's Avatar
 
City: Brookline, NH
Vessel Name: Shalloway
Vessel Model: Defever 44, twin Perkins
Join Date: Sep 2013
Posts: 2,136
Iím doing this right now. You need a broker. They will tell you what to fill out and then create the package and documents that have to go to customs.

Ken
kchace is offline   Reply With Quote
Old 07-28-2022, 11:18 PM   #4
Senior Member
 
Juliet 15's Avatar
 
City: Bellingham
Vessel Name: Knot Hours
Vessel Model: Hatteras 58 LRC
Join Date: Feb 2019
Posts: 207
I bought mine in canada. If the boat was built in the United States originally then it's pretty easy to import. If it was build outside the United States there may be some issues. I spoke with the CBP people at the Port of Entry I was bringing the boat into to get information on it. Because my boat was built in the US it was pretty easy. It's not rocket science, so you can do it. You just have to be diligent, or hire a customs broker.
Juliet 15 is offline   Reply With Quote
Old 07-28-2022, 11:41 PM   #5
Guru
 
twistedtree's Avatar
 
City: Walkabout Creek
Join Date: Jan 2013
Posts: 8,050
I would NOT relay on the sales broker. By all means ask him or her, but check and verify everything independently. In my experience brokers are focus on closing a sale, and will down-play or trivialize anything that might complicate the deal, or in any way become a deterrent.


If in doubt, close the deal out in international waters.
__________________
MVTanglewood.com
twistedtree is offline   Reply With Quote
Old 07-29-2022, 07:32 AM   #6
Senior Member
 
City: Ft. Lauderdale
Join Date: Oct 2007
Posts: 136
I strongly suggest you hire a customs broker. I have used Steele Reeder for years and find him invaluable. Look up Howard Reeder in Miami
Judy at JWY is offline   Reply With Quote
Old 08-01-2022, 01:35 PM   #7
PPD
Veteran Member
 
City: Mystic
Join Date: Jul 2020
Posts: 28
Thank you for the advice everyone.
I have contacted Howard Reeder.
PPD is offline   Reply With Quote
Old 08-01-2022, 06:49 PM   #8
Senior Member
 
City: Ft. Lauderdale
Join Date: Oct 2007
Posts: 136
Good move. Glad that worked out for you.
Judy at JWY is offline   Reply With Quote
Old 08-09-2022, 12:05 PM   #9
Senior Member
 
City: New England/Michigan
Vessel Name: N/A
Vessel Model: N/A
Join Date: Aug 2020
Posts: 160
Iíve surveyed quite a few offshore yacht deals and never any problems with Bermuda. It was treated pretty much like Canada. Venezuela on the other hand was almost traumatic for one poor buyer who was made to jump thru hoops for months. The boat was built in Argentina, high quality builder who went out of business so builders documentation was unavailable. Every broker I know, or knew years ago, always enlists a good savvy custom broker to handle the deal.

Rick
garbler is offline   Reply With Quote
Old 08-11-2022, 05:39 PM   #10
PPD
Veteran Member
 
City: Mystic
Join Date: Jul 2020
Posts: 28
So as I move this purchase along little by little, the customs broker hit me with a shocker. There is a 25% tax on chinese boats, and of course, the boat that we have had our eyes set on is a Cheoy Lee 61 LRC.

Now, considering how US/China relations are, I expected some sort of ridiculous tax, but 25% made my eyes roll into the back of my head.

Has anyone here had any experience with importing or dealing with Chinese built boats? This one was built in 1984.
PPD is offline   Reply With Quote
Old 08-11-2022, 09:19 PM   #11
Guru
 
kthoennes's Avatar
 
City: Sioux Falls, South Dakota
Vessel Name: Xanadu
Vessel Model: Mainship 37 Motor Yacht
Join Date: Oct 2013
Posts: 2,065
I might be married to an attorney, but she's not a tax attorney, and I'm not one and I don't play one on TV, but a 25% import or customs tax definitely does not sound right on a used, 1984 boat.

When we bought our boat I spent an inordinate, thoroughly unnecessary amount of time studying tax laws and regs on boats. At least now I understand that phrase you sometimes see in some superyacht listings - "not for sale to U.S. residents in U.S. waters" - and yes, we didn't take possession of a Massachusetts boat until we crossed the Rhode Island border - but a 25% tax on a used, probably multiple-owner 1984 recreational boat does not sound right. I'd get a second opinion.
kthoennes is offline   Reply With Quote
Old 08-12-2022, 07:16 AM   #12
Guru
 
kchace's Avatar
 
City: Brookline, NH
Vessel Name: Shalloway
Vessel Model: Defever 44, twin Perkins
Join Date: Sep 2013
Posts: 2,136
That’s the thing, it’s not a tax, it’s an import duty. I just went through the same thing, though fortunately not with a boat made in China. It does not matter if the boat was imported before or not. To import a boat into the US from a different country, one must pay import duty on it.

Ken
kchace is offline   Reply With Quote
Old 08-12-2022, 08:24 AM   #13
Guru
 
ranger58sb's Avatar
 
City: Annapolis
Vessel Model: 58' Sedan Bridge
Join Date: Aug 2013
Posts: 6,248
Any relief based on the current import duty maybe not in place when the vessel was originally built?

Any relief based on Cheoy Lee being a Hong Kong entity? (Pre- Hong Kong reversion to China?)

-Chris
__________________
Chesapeake Bay, USA
ranger58sb is offline   Reply With Quote
Old 08-12-2022, 08:41 AM   #14
Guru
 
City: Newport, R.I.
Vessel Name: Hippocampus
Vessel Model: Nordic Tug 42
Join Date: Jul 2020
Posts: 2,347
Found a boat sitting on the hard in Stonington Connecticut. Saw repetitively over a couple of years. Asked around and found out it was a one off used for one transatlantic race built in and used by a Englishman. After much back and forth although I found the boat and dealt initially with the owner there were definitely enough devils in the details so did involve a broker and lawyer skilled in maritime tax, documentation and law. Seller absorbed the costs (probably raised selling price to reflect that). I had my own lawyer and accountant review all paperwork. Soft costs higher than usual. Had clear title and confirmation that US documentation wouldn’t be an issue. Important that you confirm those two things before signing any contract.
England isn’t China but it was still the most involved boat purchase I ever made. Still I would do it again if a similar opportunity arose. Got a remarkable boat at a great discount.

Btw purchase isn’t the only reason to import a boat. That part isn’t difficult depending upon country . I imported my last boat into the BVIs. That year we were in and out of there so many times it was cheaper and easier to import and decrease fees/hassles with every entrance. Countries vary as to the definition of “import” and whether it’s for commercial or recreational use. Know some folks game the system flagging in a low tax/fee country and operating on cruising permits.
Hippocampus is online now   Reply With Quote
Old 08-12-2022, 09:38 AM   #15
Senior Member
 
City: Ft. Lauderdale
Join Date: Oct 2007
Posts: 136
Quote:
Originally Posted by ranger58sb View Post
Any relief based on the current import duty maybe not in place when the vessel was originally built?

Any relief based on Cheoy Lee being a Hong Kong entity? (Pre- Hong Kong reversion to China?)

-Chris
When the boat was built is not the issue. Any foreign commerce brought in to the US is required to pay duty of 1.5%. That is whether it is food, appliances, cars, or boats. The duty is almost always paid before it hits our shelves, so we are oblivious to it.

I believe in this particular case, the additional amount is because of tariffs "recently" placed on Chinese imports as a way of encouraging Americans to purchase products made in the US.
Judy at JWY is offline   Reply With Quote
Old 08-12-2022, 10:11 AM   #16
Guru
 
ranger58sb's Avatar
 
City: Annapolis
Vessel Model: 58' Sedan Bridge
Join Date: Aug 2013
Posts: 6,248
Quote:
Originally Posted by Judy at JWY View Post
When the boat was built is not the issue. Any foreign commerce brought in to the US is required to pay duty of 1.5%. That is whether it is food, appliances, cars, or boats. The duty is almost always paid before it hits our shelves, so we are oblivious to it.

I believe in this particular case, the additional amount is because of tariffs "recently" placed on Chinese imports as a way of encouraging Americans to purchase products made in the US.

Yes. I wondered if, assuming the import duty was lower back in 1984, whether that rate might apply -- instead of today's punitive rate.

-Chris
__________________
Chesapeake Bay, USA
ranger58sb is offline   Reply With Quote
Old 08-12-2022, 10:53 AM   #17
Guru
 
twistedtree's Avatar
 
City: Walkabout Creek
Join Date: Jan 2013
Posts: 8,050
The 25% tax is only on the Chinese sourced parts of the boat. So engines, generator, and much of the other equipment that makes up the boat is likely not subject to the tax. The key to taking advantage of that would be a breakdown of the boats value into the constituent parts, done by a credible 3rd party.

Iíd also confirm with the import broker that the tax applies to used goods the same as it does for new goods.
__________________
MVTanglewood.com
twistedtree is offline   Reply With Quote
Old 08-12-2022, 01:04 PM   #18
PPD
Veteran Member
 
City: Mystic
Join Date: Jul 2020
Posts: 28
Yes, I think a 25% tax is inordinate, so Iím talking to a maritime attorney to see what we can do.

I donít like the hassle of a foreign purchase, but I can deal with it for the boat we want. I was a federal govt contractor for over 20 years, so Iím somewhat conditioned to red tape and useless bureaucracy. Itís the 25% tax that has my head spinning.
PPD is offline   Reply With Quote
Old 08-12-2022, 05:00 PM   #19
Guru
 
kthoennes's Avatar
 
City: Sioux Falls, South Dakota
Vessel Name: Xanadu
Vessel Model: Mainship 37 Motor Yacht
Join Date: Oct 2013
Posts: 2,065
This is the result of a random internet search so I'm not sure about reliability, but if you're buying a 61-footer, it looks like this exclusion to the 25% tariff (duty) applied, at least until the exclusion expired in August, 2020. I wonder if that exclusion was renewed or extended.

https://www.mcswift.com/news/boats-m...d%20to%2025%25.
kthoennes is offline   Reply With Quote
Old 08-12-2022, 07:15 PM   #20
PPD
Veteran Member
 
City: Mystic
Join Date: Jul 2020
Posts: 28
I found that web page also. The boat was previously registered in the US, so I would think that the duty was paid then, but I won’t be surprised at all if the govt taxes it twice.
PPD is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


» Trawler Port Captains
Port Captains are TF volunteers who can serve as local guides or assist with local arrangements and information. Search below to locate Port Captains near your destination. To learn more about this program read here: TF Port Captain Program





All times are GMT -5. The time now is 12:47 PM.


Powered by vBulletin® Version 3.8.8 Beta 4
Copyright ©2000 - 2022, vBulletin Solutions, Inc.
Search Engine Optimization by vBSEO 3.6.0
Copyright 2006 - 2012