Low Rate VAT Scheme for
Yacht Finance Leasing
www.acumum.com | info@acumum.com | Skype: acumum
Special regulations govern the financial-leasing of yachts to third
parties by Maltese companies, allowing for significant...
Acumum can assist you via our dedicated Malta Maritime specialists in providing you with a range of services:
 Formation ...
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Malta VAT Scheme - Yacht Finance Leasing - Acumum-Legal & Advisory

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Malta, a fiscally competitive EU jurisdiction, provides for a low VAT scheme for boats & yacts.

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Malta VAT Scheme - Yacht Finance Leasing - Acumum-Legal & Advisory

  1. 1. Low Rate VAT Scheme for Yacht Finance Leasing www.acumum.com | info@acumum.com | Skype: acumum
  2. 2. Special regulations govern the financial-leasing of yachts to third parties by Maltese companies, allowing for significantly reduced VAT rates on the acquisition of the yacht. What is finance-leasing? A Malta company (lessor) purchases a yacht and leases it to a third party (lessee), who may be an individual or company (whether Maltese or not), with the option in favour of that third party to purchase the yacht at a fraction of the purchase price at the end of the lease. This will result in the lessee enjoying significant EU VAT rate reductions on the total acquisition price. Malta’s standard VAT rate is 18% and is levied on the lease charges when a Malta company purchases a pleasure yacht and enters into a finance-leasing contract with the lessee as the supply of the service is deemed to occur in Malta. Malta VAT authorities, to assist with calculating the time spent in EU waters, have issued a “presumed” length of stay chart: Example: a motor yacht, 16.5 metres in length is presumed to be in EU waters for 40% of the time, resulting in an effective VAT rate of 7.2%. Requirements  Lease contract must be between a Malta company and a Maltese or foreign person or company;  Approval of Commissioner of VAT must be obtained in writing prior to commencement of the lease, to determine the applicable rate of use in EU waters;  A valuation certificate is to be given to the Commissioner of VAT before the transaction;  Lease agreement to be between 12 months and 36 months;  The yacht is to be brought to Malta (at least once during the term of the lease, preferably at commencement;  Lease contract must require that lessee pays 50% of the value on signing and the balance within the term of the lease;  Final purchase price must not be less than 1% of the original value of the yacht., upon which 18% VAT is charged;  The Malta company must make at least 10% profit on the transaction. Low Rate VAT Scheme for Yacht Finance Leasing Yacht Type % of Lease Subject to VAT Effective VAT Due Yachts over 24 meters 30% 5.4% Sailing yachts from 20.01 - 24 metres 40% 7.2% Motor yachts from 16.01 - 24 metres 40% 7.2% Sailing yachts from 10.01 - 20 metres 50% 9% Motor yachts from 12.01 - 16 metres 50% 9% Sailing yachts up to 10 metres 60% 10.8% Motor yachts from 7.5 - 12 metres 60% 10.8% Excellence | Superb Client Service | Cost Efficient info@acumum.com | www.acumum.com | Skype ID: acumum Malta Office: +356 2778 1700 260 Triq San Albert, Gzira, GZR 1150, Malta (EU)
  3. 3. Acumum can assist you via our dedicated Malta Maritime specialists in providing you with a range of services:  Formation of shipping companies - both ship owning and ship management  Malta yacht & ship registration  Malta bareboat charter registrations  Mortgage registration & discharge  Security documentation  Handling of all flag administration matters  Tax planning for merchant vessels and yacht owners  Accounting and secretarial support If you would like further information or would like Acumum to start the process of registering your ship or yacht under the Malta flag, please contact us. Excellence | Superb Client Service | Cost Efficient info@acumum.com | www.acumum.com | Skype ID: acumum Malta Office: +356 2778 1700 260 Triq San Albert, Gzira, GZR 1150, Malta (EU) Geraldine Noel Managing Partner Malta Office:+356 2778 1700 Ext. 101 Email: gnoel@acumum.com Geraldine Spiteri Partner Malta Office: +356 2778 1700 Ext. 102 Email: spiteri@acumum.com Acumum - Legal & Advisory: Maltese, UK & International Lawyers, Tax Advisors & Accountants Excellence | Superb Client Service | Cost Efficient info@acumum.com | www.acumum.com | Skype ID: acumum Malta Office: +356 2778 1700 260 Triq San Albert, Gzira, GZR 1150, Malta (EU) Aviation Corporate & Company Formation Estate & Wealth Management Arbitration & Litigation Financial Services Licenses Immigration - Citizenship & Residency Gaming Insurance Licenses Maritime & Yachts Intellectual Property Taxation Trusts & Foundations Guidance Purposes Only V1.1 2014

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