VAT Consulting
& Structuring

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VAT Consulting and Structuring

Malta’s prominence in the maritime industry stems not only from its strategic Mediterranean location but also from its attractive incentives, including competitive VAT solutions for yacht and superyacht owners. These incentives have solidified Malta’s position as a preferred flag for yacht registration and operations.

VAT Treatment for Yachts Intended for Private Use

Malta offers advantageous VAT treatment for yachts leased for private use through structured operating leases. Key details include:

Lease Structure: A lessor (yacht owner) leases the yacht to a lessee for a defined period, with VAT payable on the annual lease instalments. The VAT is calculated based on the yacht’s actual use and enjoyment within EU waters.
VAT Adjustments: While the standard VAT rate in Malta is 18%, adjustments are applied to reflect the time the yacht is used outside EU waters, effectively reducing the VAT burden.

To benefit from this structure, the following conditions must be met:

If the yacht is sold in Malta after the lease period, the standard 18% VAT applies to the sale value, subject to compliance with Maltese VAT regulations. A VAT Paid Certificate is then issued upon meeting all requirements.

VAT Treatment for Yachts Intended for Commercial Use

For yachts used commercially, Malta offers VAT deferment options, eliminating upfront VAT payment on importation, depending on the below structures:

Maltese Entity: A Maltese-owning entity with a valid VAT registration can defer VAT without a bank guarantee.
EU Entity: An EU-owning entity with a Maltese VAT registration can also defer VAT, provided a VAT representative is appointed in Malta.
Non-EU Entity: A non-EU owning entity may defer VAT by providing a bank guarantee based on 0.75% of the yacht’s value, capped at €1 million.

To utilise these options, the yacht must be imported into Malta for VAT and customs procedures. Once processed, the yacht gains free circulation within EU waters.

Additionally, short-term charters originating in Malta benefit from a reduced VAT rate of 12%, providing further flexibility and cost savings.

Temporary Importation Procedure

Non-EU residents with yachts registered outside the EU can avail of Malta’s Temporary Importation Procedure, which allows yachts to remain in European waters for up to 18 months, moving freely without additional customs formalities. As such, there is an exemption from Customs Duties and VAT and no payments are required on the yacht’s value during this period. At the end of the 18-month period, the yacht must leave EU waters. A security or guarantee is required to cover potential customs duties and VAT if the yacht fails to exit EU territory as stipulated.

Why Choose Malta for VAT Structuring?

Malta’s VAT solutions provide yacht owners with flexible, cost-effective options tailored for both private and commercial use. These incentives, combined with the island’s robust maritime infrastructure and professional administrative support, make Malta a premier destination for yacht VAT consulting and registration.

Disclaimer: The information provided on this website is for general informational purposes only and does not constitute legal or professional advice. We recommend seeking guidance from a qualified legal or professional advisor, with whom we can put you in touch to assist and provide specific advice related to your situation.

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