The French Tax Authorities have recently confirmed that VAT is due on advanced provisioning allowance (APA) for charters starting in French/Monegasque territorials waters. This is already in place for charters starting in Italy. When VAT has been paid at source on APA related expenses (such as food, beverages, fuel, oil and marine expenses), there is no need for the owning company to charge the charterer VAT.
In cases where commercial VAT exemption has been applied on APA related expenses, the owning company must charge the charterer VAT and send the amount to SOS Yachting France for payment to the Tax Authorities. Indeed, the VAT exemption is reserved for commercial yachts and therefore not transferable to the charterer who is considered as an end user.
DISCLAIMER | The information provided in this text is for general information purposes only and doesn’t replace the advice of a legal advisor or of a tax consultant.
