Jan 22, 2020
Malta

Malta model for individuals to minimize VAT on the purchase (lease) and use of yachts

Are you in lookout for a reliable solution that will help you save on VAT when buying and using a yacht in the territorial waters of the EU? Malta is one of the top options for this purpose.

register a yacht

The model will be implemented within 4-8 weeks, will help you save funds, and at the same time maintain reputation.

Our offer is suitable for yachts of any size and with any flag.

Why use a yacht in Malta?

Malta is an island nation and has solid background of operation with sea vessels.  There are ports adapted on each island for servicing a yacht, for crew’s leisure and for ensuring comfortable trip.  Malta is the largest maritime registry in Europe and the 6th largest in the world. Particularly, it is one of the largest registries in Europe for pleasure yachts and super-yachts. The number of registered vessels exceeds 11 thousand. Registering a vessel in the registry takes 48 hours.

The yachting industry in Malta is divided into two main categories: commercial yachts and leisure yachts.

Commercial yachts are used to generate income. It is noteworthy that organizations engaged in maritime shipping are excluded from corporate taxation.  VAT in Malta is one of the lowest by rate in Europe – 18%.

Moreover, a favorable taxation regime is set up for yachts and superyachts. There are governing principles that allow you to apply VAT when renting a yacht only when using a vessel within the EU territory. There are several models applicable.

In one case, when using leasing mechanism, VAT may go as low as 5.4%.

In case of long-term lease, whereby the lessee uses the yacht outside the EU and in international waters, VAT is not charged.

Vessel maintenance and the corporate structure through which you will own the yacht are low-cost.

Yacht leasing structure on favorable terms

We offer you to establish a special structure in Malta for the ownership and use of the yacht. With this solution applied, you can optimize your VAT expenses and protect your personal information.

The structure is quite simple to follow:

  • You register a company in Malta;
  • The registered company receives a tax number and a VAT payer number;
  • The registered company buys a yacht, registers it (not necessarily in Malta)
  • The registered company gets authorization to pay VAT when renting a yacht;
  • The yacht arrives in Malta at the start of the lease term;
  • Then, a contract is concluded for a long-term rental of a yacht (more than 90 days);
  • VAT is paid upon leasing according to preliminary estimates;
  • Annual VAT adjustment is made depending on the designated use of the yacht;
  • At the end of the lease period, the yacht can be leased or re-sold.

The lessor (company in Malta) should have a VAT number. The lessee should be exempt from taxes and use the yacht for personal rather than commercial purposes. First you need to get permission from the local tax authorities.

You will learn more from our consultants about how the model works. Write us at  [email protected] 

The cost of creating and maintaining a structure in Malta

Main expenses:

  • Registration of a company in Malta – from 2591 EUR;
  • The authorized capital of the company – from 1250 EUR;
  • Getting a VAT number;
  • Buying a yacht – the price depends on the yacht;
  • Payment of VAT at the agreed rate.

In the course of the company’s operations, it will be necessary to ensure its business processes (accounting, legal address, employee salaries etc.). The costs of maintaining the yacht are transferred to the lessee.

The cost of company operation:

Euro (€)   
REGISTRATION SERVICES Holding / Trade Company
  1st year Starting from 2nd year
Company registration  1482 –
Provision of a legal address (according to Maltese law, all original documents should be stored directly in the company’s office of incorporation) 741 741
Contribution to the Registry (minimal amount, depends on the amount of authorized capital for issue) 368 150
TOTAL from 2591 EUR 891
  Euro ( €)
ANNUAL OPERATIONAL COSTS Holding company Trade company
Director’s services (minimum, depends on the degree of involvement) 1555 3588
Secretary Services 963 963
Nominal shareholder’s services 1690 1690
Accounting/bookkeeping (minimum)   803 1927
Preparation and submission of tax reports 466 621
Preparation and submission of annual financial report 234 234
The following services are paid as needed.    
Opening a bank account Upon request Upon request
Registration of VAT number   N / a 120
VAT declaration N / a 186
Registration and receipt of income taxpayer number (for each shareholder) 180 180
Tax refund (on behalf of shareholders)    359 359

The costs of purchasing, registering and maintaining a yacht depend on the vessel itself.

Documents for creating a solution for European VAT in Malta

To register a company in Malta you will need:

  • A certified copy of the passport;
  • Personal statement;
  • Recommendation from the bank;
  • Proof of residence address (copy) – dated back not more than 3 months;
  • Your CV

When buying a yacht, financial institutions may request proof of legal origin of funds.

Malta procedural model for yachts: Minimize VAT in Europe

  1. Contact [email protected]and inform that you plan to use the offer.  
  2. Provide your individual details and information about and the yacht. Get professional advice.
  3. Pay the cost of the service. The price depends on several factors, including the class of the yacht.
  4. Submit the necessary documents. Once we receive payment and documents, we proceed to establishing the necessary model in Malta.
  5. You take a yacht for a long-term lease and take advantage of all of the above opportunities.

Contact us now: [email protected]