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Yacht VAT Leasing in Malta 2017-08-08T09:00:51+00:00

Yacht VAT Leasing in Malta

One of the attractive benefits for the private yacht owner who registers under the Malta flag is to avail from this yacht finance leasing which is mainly offered in Malta yacht industry.

Private yacht owners may lease their yacht to the lessee for a consideration in which the latter has the option to purchase the boat at a percentage of the original price at the end of the lease period.

The Maltese VAT Department has issued a guideline on the VAT treatment of yacht leasing arrangements entered into by Maltese companies.

Guidelines on the Requirements

  • The yacht must come to Malta, at the beginning and end of the lease agreement;

  • The leasing agreement shall be between a Maltese company and any Maltese or foreign person or company;

  • An initial contribution shall be paid by the lessee to the lessor amounting to at least 40% of the value of the yacht;

  • The lease instalments shall be payable every month and the lease agreement shall not exceed 36 months;

  • The lessor shall be expected to make a profit from the leasing agreement, over and above the value of the yacht;

  • The final payment at the end of the lease agreement shall not be less than 1% of the original value of the yacht. The final lease payment is chargeable to VAT at 18%;

  • Prior approval of the lease agreement must be sought in writing from the Commissioner of VAT who must approve the value of the yacht and the applicable percentage on which VAT is chargeable according to the use of the yacht in EU territorial waters.

Yacht Finance Lease Schedule 

Type of Yacht % of lease subject to VAT Effective rate of VAT
Sailing boats or motor boats over 24 metres in length 30% 30% of consideration x 18%
Sailing boats between 20.01 to 24 metres in length 40% 40% of consideration x 18%
Motor boats between 16.01 to 24 metres in length 40% 40% of consideration x 18%
Sailing boats between 10.01 to 20 metres in length 50% 50% of consideration x 18%
Motor boats between 12.01 to 16 metres in length 50% 50% of consideration x 18%
Sailing boats up to 10 metres in length 60% 60% of consideration x 18%
Motor boats between 7.51 to 12 metres in length (if registered in the commercial register) 60% 60% of consideration x 18%
Motor boats up to 7.5 metres in length (if registered in the commercial register) 90% 90% of consideration x 18%
Boat permitted to sail in protected waters only 100% 100% of consideration x 18%

VAT Paid Certificate 

Once the lessee opts to purchase the yacht at the end of the lease, a VAT paid certificate will be issued to the lessee provided that all VAT due has been paid.

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