TaxCorporate TaxBoat tax bill puts yachting business at risk

Boat tax bill puts yachting business at risk

Yachting business faces insolvency after back-tax bill of £50,000

A 70-year-old yachting business is facing insolvency after being hit with a
£50,000 tax bill because its imported boats were too short.

Dorset Yacht Co faces administration after the
tribunal
found that 120 boats it had imported, Boston Whalers, should not have been
classed as ‘seagoing’ as they were less than 12 meters long. Only professional
fishing boats or lifeboats can be classed as seagoing below that length.

The decision by tribunal chairman Howard Nowlan was reached ‘reluctantly’,
because
of the ‘obtuse drafting’ of the tax rules.

‘While we accept that the following points were of no technical relevance, we
do also sympathise with the appellant because Customs officers themselves
appeared to classify the boats wrongly,’ said Nowlan.

‘Had the appellant realised that a 1.75% duty was due in respect of the very
superior boats that sold at a premium on account of their unique
characteristics, we were convinced that no customers would have been lost on
account of a resultant small price rise.’

Court documents suggested the company, formed in 1938, may now become
insolvent as a result of the substantial bill for back duty.

Related Articles

Big names, little tax: Airbnb, Facebook, Kellogg’s, eBay

Corporate Tax Big names, little tax: Airbnb, Facebook, Kellogg’s, eBay

2m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
EU divided over radical tax reforms targeting tech giants

Corporate Tax EU divided over radical tax reforms targeting tech giants

2m Alia Shoaib, Reporter
‘Improve rather than lose’ disincorporation relief, tax body urges

Administration ‘Improve rather than lose’ disincorporation relief, tax body urges

2m Austin Clark, Reporter
How to educate your clients about tax avoidance

Corporate Tax How to educate your clients about tax avoidance

2m Clear Books | Sponsored
CGT clampdown nets HMRC £124m – but could lead to increase in use of avoidance schemes

Corporate Tax CGT clampdown nets HMRC £124m – but could lead to increase in use of avoidance schemes

3m Austin Clark, Reporter
‘Google tax’ nets HMRC £281m

Corporate Tax ‘Google tax’ nets HMRC £281m

3m Emma Smith, Managing Editor
Should I incorporate my buy-to-let business?

Corporate Tax Should I incorporate my buy-to-let business?

4m Emma Rawson