When purchasing a new yacht it is imperative to consider the potential liability stemming from sales tax, use tax, employment laws and potential casualties. Prior to July, 2010, when Florida’s tax cap took effect, we often recommended mitigating these potential liabilities by “flagging” (registering) yachts offshore with a “flag of convenience” country, including the British Virgin Islands, St. Vincent and the Grenadines, and the Marshall Islands.
With Florida’s change however, (see, Florida Tax Cap), there is no longer a strong incentive to flag yachts offshore if they are intrerested in being based in the state of Florida. In many cases, therefore, we are now recommending that offshore boats file the appropriate papers and register with Florida. Many boats will begin to see savings in registration fees, fuel and other carrying costs (as comparted to the $18,000 payment to Florida) in just two to three years. We can assist with that process.
For appropriate boats, however, we can take you through the offshore flagging process by:
- Helping you to choose the correct foreign flag for your yacht
- Forming your “offshore” International Business Company
- Drafting all necessary paperwork to limit contractual liability
- Recording and registering your yacht with our team of agents
- Providing necessary financial, insurance and crewing advice
- Having an attorney attend and coordinate offshore closing
- Ensuring proper Coast Guard approval of your registration
Our firm prides itself on its innovation and understanding of unique yacht transactions, foreign registration, and offshore closings. If you are considering purchasing a yacht or you have already signed a purchase agreement please contact our attorneys to see if offshore flagging could help to mitigate your liability and save you significant money.