Yacht Registration

/ September 1, 2015

I was born in the UK and now live in New Zealand and I also have New Zealand citizenship and am planning on buying a boat in Europe to sail back to New Zealand.

Different nationalities have got options on which country you can register the boat in. Like all things there are benefits and weaknesses depending on which option you go for. Here is what my research has turned up:

According to a book I am reading at the moment “The Outlaw Ocean”, the author explains that there is a provision in maritime law that treats a ship in international waters like a floating embassy, in effect a detached chunk of the land whose flag it flies. That means the laws that apply on board are only those from the country where the ship is registered.

New Zealand Registration

When a ship registered in New Zealand travels overseas, its registration gives it the protection of the New Zealand Government. This is in much the same way as a New Zealand citizen is protected while traveling overseas. The ship’s registration papers provide proof of identity like a passport does for a person.

There are two ways to register your yacht – Part A is for larger vessels and involves a title of sorts which can also have a mortgage listed against it. This type of registration remains with the vessel all the while it is owned by a New Zealander. The cost is $2160.00 for a new build or $3024.00 for an existing yacht.

Part B registration lasts for 5 years and terminates when you sell the vessel. It is designed mainly for pleasure craft. The cost is $720.00.

Some excellent information about registering boats can be found on the Maritime NZ website.

The other consideration is that NZ registered vessels are required to have to have Cat 1 safety certification to leave New Zealand. This can be an expensive exercise, requiring the boat to be hauled out and inspected to prove that it has all the relevant safety equipment on board. While this can be expensive and inconvenient, I do believe that having the yacht prepared to that level of safety is really important. However some people choose to register their boats offshore to avoid having to go through this Cat 1 inspection process.

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UK Yacht Registration

Again there are two parts. Part 1 is similar to part A for NZ – however the cost is only GBP124.00. British Citizens overseas are eligible to register using this one. Part III is similar to our part B but it stipulates that you must be resident in the UK for 185 days a year and we won’t qualify for that. The cost for that one is GBP25.00. More information can be found on this website. Both of these options last for five years.

It also states that if the yacht is owned jointly by two people, and one qualifies and the other doesn’t, then the other partner can have a minority shareholding. Ships/yachts for the purpose of registration, are divided in to 64 shares. so as the British Citizen, I should have 33 shares and my partner 31.

The other consideration with being UK registered would be the VAT implications. If we buy a yacht in Europe, the intention would be to take it out of the EU and not have to pay any tax until we import it back in to NZ. See below…

The Decision

A flag – or country of registration is a symbol of loyalty, belonging and affiliation.

An open registry or flag of convenience is a country that allows people from any nationality or with no affiliation to register their vessel in that country. Closed registries or national registries require people to be either a citizens of that country to register their vessel there.

The certificate of registry is evidence of ownership and nationality of the vessel.

Well weighing up all those options, the British Registration does definitely come out the cheapest, and the next time the boat left New Zealand then we wouldn’t be required to get the Cat 1 certification.

However I have decided to go with the New Zealand option for the following reasons:

  1. I will be intending to purchase the boat VAT (tax) free in Europe because I will be exporting it. By having it registered as a British boat, this might make the export argument less plausible.
  2. I will be able to travel on my New Zealand passport, on my New Zealand registered boat. Meaning that I get the same protection from the NZ Government when traveling abroad. I think things could be a bit confused if I had a British Registered boat, with a New Zealander on board. Keep things simple & less confusing all round if we are all the same.
  3. New Zealand is my actual home, where my son lives, and where I will retain my residential tax status. While this does have certain financial constraints, it does mean that if anything should happen I will be able to come home and still be able to access the public health system, or if we set off our EPIRB, then the NZ Search and Rescue teams will assist with our recovery.

I will also keep my British passport current so that should I lose my New Zealand passport somehow I will still have options.

What are your thoughts? Where is your boat registered? Do you have any advice or suggestions in regards to boat registration options?

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22 thoughts on “Yacht Registration”

  2. I remember when we looked into this too – register our boat in the States (where we were born), NZ (where we’re permanent and tax residents) or Ireland (we also have dual citizenship). We ended up going with the States for a variety of reasons – cheaper, less stringent (no Cat 1 requirements) and matches our primary passports.

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  3. Hi Viki and Andrew
    I like the safety of having things be straightforward and “honest” even if it’s not the most convenient or cheapest option. If you sail around Europe before heading home, you may run into other snags. Some American cruising friends, Ed and Sue Kelly, wrote an article for Practical Boat Owner last year outlining their nightmares with Schengen restrictions for non-EU cruisers. Here is a link to the article (http://www.pbo.co.uk/news/change-in-visa-could-welcome-worldwide-yachtsmen-1061). There are ways to do it, like planning your cruising route to spend time in the Med’s non-Schengen countries. But maybe if you have a UK passport you can get around all this? It may be important as to whose name is listed as the owner or principal owner of the boat. Good luck with the plans ! (Fun, even if frustrating, right ?)

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    • Thanks for that link Maria. Interesting stuff. We are off to New Caledonia next week. I will have a chance to use my rusty school-girl French on some unsuspecting shop keepers! Can’t wait 😉

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  4. Right now our boat is registered Canadian, cause we are! But we are thinking to have it registered Marshall Islands. Would form a Cie and the boat will be the property of the Cie. That way, if something happens, it is not the individuals that would take responsibility… We see too much Americans suing for any reason, we don’t want to take that risk.

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  6. The UK doesn’t require registration and part III was invented to pacify our European friends who wanted some kind of proof of ownership of boats coming from here. It’s not stringent at all. Fill in a web form and they send you a certificate and that’s it. As far as I know nobody checks anything.

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  8. Hi there,
    I’m just trying to understand buying a boat overseas and registering in NZ. Something I’m unclear about…if a NZ flagged vessel needs to be certified cat1 before heading overseas, what happens if you buy the boat overseas? When does it have the Cat1 survey? Seems a bit of a catch22.
    Kind regards,
    Gerry

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    • Hi Gerry,
      My understanding is that the boat only needs cat 1 when you’re actually departing NZ and as soon as you’ve left it actually expires. So if the boat is already overseas then it’s not an issue. Cat 1 is more a case of ensuring the vessel and her crew are fit and prepared for the long voyage to anywhere from NZ – which is of course a major undertaking. The registration is just an administrative process. Hope that helps!

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      • Hi Viki,
        Thanks for such a quick reply! That’s interesting and a bit counterintuitive to me, but fair enough! Of course the journey to NZ is equally serious…I think?!
        So I’m guessing you were able to buy your boat abroad, register it in NZ, and begin sailing straight away without the Cat1, and then when you made it to NZ you had the Cat1 inspection, as well as any other necessary inspections for importing it?
        Sorry for all the questions…I’m just thinking about it and I suppose it’s not the “normal” way of doing things so I can’t find much information online. There’s now the obvious added dimension of corona making everyone’s life more fun…
        Thanks again for such a prompt reply 🙂
        All the best,
        Gerry

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      • Yes you’re correct. You’d be able to sail it here without any cat 1 inspection and certificate. But you’d probably want to make sure you had all the cat 1 gear on board to make the passage. You only get the cat 1 sign off just before you depart NZ again. It’s only required for departing NZ. If you’re racing around NZ waters you need cat 2 or 3 depending on the race (just a bit less stuff required in your medical kit and a few other things) but if you’re just cruising around then you don’t actually even need to get those certificates sorted.
        So when you do come in, if the boat hasn’t been built/or imported in to NZ before, you’ll have to pay 15% GST and 5% duty on it. (Which sucks… I’ve got another post about that somewhere. I’ll find the link for you)

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      • Ok well I guess that’s actually pretty simple…of course I’d want all the Cat1 safety gear. Shame about the GST etc. but that’s life and tax pays for a lot of good stu ff so can’t complain too much. Thanks again for all your help!
        Best wishes,
        Gerry

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    • hi my understanding is if you buy a boat offshore and bring it back to nz you can do 1 of two things if you register it in nz and pay gst and 5% import tax on arival to nz and have to get a cat 1 cert before you can depart nz or register the boat in a different country sail to nz and as long as you dont stay here for more than 6 months on the boat before you depart again you dont have to pay the gst or import tax and the boat doesnt need a cat 1 cert to depart and once you have stayed on the boat for more than 18 months you can bring the boat to nz and not have to pay the tax as the boat is now classed as a household item and exempt for tax

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      • I think if you are moving permanently to NZ from another country and bringing a boat with you then you can get around the tax, but I believe if you are usually an NZ resident then I am pretty sure this doesn’t apply. Also if you’ve got an internationally registered vessel you can bring it in to NZ for up to two years, and get all the costs of maintenance & repairs done GST free – but not sure if that applies if you are an NZ’er. Its called a TIE – Temporary Import Entry.
        So many rules & regulations! There’s a bit more info here: https://astrolabesailing.com/2015/09/04/tax-vat-gst-2/
        I am not an expert either by the way so always best to do your own research. These things seem to change on a regular basis!

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