Luxury Yacht VAT Registration rules and conditions
The Malta Super Yacht VAT Registration Programme offers yacht owners looking to buy a new luxury yacht attractive savings on VAT. The Malta Super Yacht VAT Registration Programme is an approved EU VAT registration programme that allows for VAT to be paid on luxury yachts entering EU waters at a reduced rate. The Malta VAT department has issued sailing yacht and motor yachts VAT rates dependant on the size and propulsion of the luxury yacht. The vessel will be EU VAT paid and free to travel in EU waters with no restrictions.
For VAT registration to be successful the purchaser of the luxury yacht must adhere to the specific luxury yacht VAT registration rules and conditions. These need to be completed in order to be able to take advantage of The Malta Super Yacht VAT Registration Programme.
The luxury yacht VAT registration rules and conditions are as follows:
1. The luxury yacht or pleasure yacht has to come to Malta for the beginning of the lease agreement and subsequent VAT registration.
2. The financial leasing agreement shall be between a Maltese company and any Maltese or foreign person or company.
3. Prior approval shall be sought before VAT registration in writing from the Commissioner of VAT who is to confirm the rate applicable according to the use in EU territorial waters (depending on the size and propulsion of the luxury yacht), as well as the acceptability of the value of the luxury yacht as declared. For this purpose a valuation certificate of the luxury yacht shall be submitted with the application for approval. VAT registration is then confirmed.
4. At the beginning of the lease an initial contribution shall be paid by the lessee to the lessor amounting to 50% of the value of the luxury yacht. This is subject to the reduced VAT charge.
5. The remaining 50% of the value of the luxury yacht is spread over a number of lease instalments which is payable every month. The lease agreement shall not be less than 12 months and not more than 36 months. The recommended period is of 12 months.
6. The lessor shall be expected to make a profit from the leasing agreement over and above the value of the boat.
7. Any purchase value of the luxury yacht at the end of the lease shall not be lower than 1% of the original value of the yacht and will be subject to the full standard rate of 18% VAT.
8. If the lessee opts to purchase the luxury yacht at the end of the lease, a VAT paid certificate will be issued to the lessee provided that all VAT has been paid.
9. Recognised classification societies.
For more clarity on the Malta Luxury Yacht VAT Registration Rules please contact us.
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