Tax Advice

Requirements for commercial use

Commercial Charter Yachts

If a yacht is to be used for commercial charter in EU waters, one important tax issue to consider is whether the yacht operating company should register for EU VAT in one of the EU member states so taking advantage of the VAT efficiencies available to EU businesses.  An analysis of cash flow projections is necessary to determine the most appropriate decision.

We can advise if VAT registration is appropriate for a charter business, and if appropriate, we can co-ordinate the registration process.  The decision must be made as early as possible and ideally before the yacht is purchased.   It is also important that the flag state is within the EU to ensure continuity of the yacht's VAT status.

Operating as a Charter Yacht may have VAT advantages but it also has some disadvantages.  The yacht must be operated as a genuine business and then it will be necessary for the owner to charter the yacht for personal use and a market charter fee paid to the charter company.  The financial implications of this can be analysed by us to assist in the decision making process.

Tax Advice

The Company is part of the Osiris Group and it's associated company, Baker Tilly Channel Islands Limited, is an independent member of Baker Tilly International.    Our local experience and the global expertise provided by Baker Tilly International's independent member firms enable us to provide specialist advice in developing a tax efficient yacht ownership structure.  Depending on the particular circumstances, structures to mitigate VAT, Capital Gains Tax and Inheritance Tax can be developed to meet the needs of the owners.