I keep a Nauticat 37 in Mediterranean Spain. I have had it from new and VAT was paid in the UK. I have had assurances from the RYA and the Cruising Association, who have been in touch with the European Commission, that VAT paid boats situated in the EU on 31 December 2020 will be treated as a EU good and will continue to be deemed as EU VAT tax paid. This understanding has also been confirmed to me by my marina manager, who foresees no impediment to continued free circulation subject to Schengen area time limitations on me (not the boat).
The issue of retaining UK VAT status is a different matter. At present, after a very late pronouncement from HMRC, we would have only up to December 2021 to get our VAT paid boats back to the UK if we are to avoid paying VAT again in the UK, as it will be deemed that we have exported them. Representations about the unreasonableness of this position continue to be made.