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Malta Yacht Leasing/VAT Incentives
The VAT on Yacht Leasing Regulations of January 2006 have made it
possible to reduce the effective VAT payable on the purchase of Yachts
to as low as 5.4% VAT and this by virtue of a Financial Leasing
agreement made between a Malta Shipping Company acting as Lessor and any
other third party (who does not necessarily have to be a Maltese
national or a Malta Company) acting as Lessee. At a glance, the salient
features of the Malta VAT on Yacht Leasing scenario are as follows:
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Reduction in the value of
the yacht on the lease agreement on which VAT is payable resulting in an
effective rate of VAT payable as low as 5.4% (as opposed to the standard
18%)
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Reduction in value of the
yacht and consequent VAT rate payable directly dependent on the length and
type of yacht being leased.
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Lease agreement should last
at least one (1) year and cannot exceed three (3) years.
No obligation to opt for financing via banks or other financial
institutions. Client reserves the right to do so should the need arise.
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Should the client resort to
financing, security can be provided by a mortgage registered over the yacht
(LINK - SUB 3), by a Deed of Covenants collateral thereto, as well as a
pledge of shares in the owning company in favour of the bank or financial
institution.
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Yacht must be present in
Malta on termination of the period Lease agreement when lessee exercises the
purchase option thereby taking over the ownership of the yacht.
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Upon expiry of the lease,
once VAT on all instalments has been paid, the Malta VAT Department will
issue an EU-wide VAT-paid certificate.
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Lessor must be a Maltese
person, natural or juridical.
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Lessee may be a foreigner,
natural or judicial.
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No obligation to register
one's yacht under the Malta flag.
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The yacht may be new or
used.
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The yacht may still be
chartered by the lessee throughout the lease period, should he elect to do
so.
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The effective VAT rate is
directly dependent on the type and length of the yacht. To this effect the
VAT Department has issued guidelines illustrating the various VAT
percentages set according to the length of the craft and its means of
propulsion (power or sailing). Please feel free to forward the details of
your yacht so that we may advise you accordingly.
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to Malta Maritime Centre
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SPONSORS |
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Malta law firm Chetcuti Cauchi Advocates
Law firm specialising in
Ship Registration,
Yacht Registration,
Financial Leasing of Pleasure Craft,
VAT on yachts,
International Tax & Legal Advice,
International
Company Formation,
Intellectual Property,
Trusts,
Financial Services,
iGaming,
IP Management,
Maltese residence. |
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Malta tax consultancy Malta-Tax
Tax
consultants and accountants providing personal taxation, company
accounting and taxation, Value Added Tax consultancy and back
office services. |
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