Boat Finance
Now, having explained all you need to know about marine mortgages,
are there any other ways to finance your yacht or boat in the UK ? - the
simple answer is yes, and it's called leasing finance.
Whilst marine mortgages have been around for a long time, and most buyers have a good understanding of how the finance works, financing your boat with a lease is a relatively new concept, particularly for UK buyers, and is still unknown to many boat finance companies.
It often comes as a great surprise to their clients that they can take advantage of this innovative way of not only financing their boat more flexibly, but also in saving a considerable amount of VAT to boot - the best of both worlds!. So how does boat finance using a lease work? - let's take a look at some of the basics, and if you would like a quote and more information please just follow the link to our boat finance site.
Boat Financing
Now, before I explain briefly how you can use a European lease to finance your boat, let me make one thing clear - if you are a UK resident then it's good news, as you can use this finance solution as well - you do NOT have to live in Italy or France to take advantage. Many of our clients run businesses here and have happily financed their yachts using a French or Italian lease. So please don't believe anyone who tells you otherwise!
Many people are confused by leasing and how the principle works, so let me try to explain. In simple terms, leasing a yacht is no different to leasing a car. You choose your boat, with all the extras, agree a price with the broker or manufacturer, pay a deposit, which is normally around 20%, and then arrange with the bank to pay the balance. The bank then lease your boat back to you with agreed monthly or quarterly payments, and at the end of the lease contract, you have the option either to buy the boat at a pre-agreed percentage of the original price, or alternatively to simply give the keys to the bank and walk away. They will then sell your used boat on the open market. So how does this save VAT? We have the Italians and French to thank for that - ( Malta has recently joined the scheme as well )
Finance A Boat
Several years ago, both the Italian and French governments introduced tax benefits for yacht buyers in order to support their yacht manufacturing industries, and to try to protect their markets which were in decline at the time. In order to encourage buyers and yacht manufacturers alike, both governments introduced VAT incentives based on leasing finance, which in essence allowed for reduced VAT to be paid on the repayments, during the term of the lease. Full VAT was only payable on the final payment of the residual value, as this was the point at which a transfer of goods took place - in other words the point at which the yacht was actually sold (this is why residual values are always kept as low as possible !) Although both schemes work in slightly different ways, the net result is the same, in that the bigger the boat, then the greater the VAT saving on the repayments. So for an Italian lease these can be reduced to as little as 6% for a boat over 24 metres, and to 9.8% under the French scheme - a significant saving. The minimum size of yacht we are able to lease finance starts at around 500,000 Euros ex VAT, and if you feel this might be of interest, then please just follow the link here for a leasing quote, to help you finance a boat.
Now let's look at another area of boat finance and purchase, namely the survey of the vessel. As with most things in the boating world it can be confusing, and if you get it wrong, very costly. So let's look at the key issues when arranging for a survey as part of the process of obtaining your boat finance.
Marinablu International Ltd is an Introducer Appointed Representative of DeNovo Underwriting Agencies Ltd. DeNovo Underwriting Agencies Ltd is Authorised and Regulated by the Financial Services Authority (FSA)