Malta runs a unique Yacht Leasing Scheme that allows your vessel to be purchased through a leasing company and save you a minimum of 50% on VAT.
A vessel is purchased through a leasing company, an agreement is entered into between the company and the lessee for a period of at least 12 months. At the end of the lease period the lessee has the option to buy the vessel at 1% of the value.
A Malta VAT paid certificate is issued at the end of this procedure. VAT paid in Malta is valid across the European Union, giving the right to the vessel to remain in EU waters permanently.
| Type of craft |
% of lease subject to VAT |
Effective rate of VAT |
Sailing boats or motor
boats over 24 meters in length |
30% |
5.4% |
Sailing boats between 20.01 to 24 meters in length |
40% |
7.2% |
Motor boats between 16.01 to 24 meters in length |
40% |
7.2% |
Sailing boats between 10.01 to 20 meters in length |
50% |
9% |
Motor boats between 12.01 to 16 meters in length |
50% |
9% |
Sailing boats up to 10 meters in length |
60% |
10.8% |
Motor boats between 7.51 to 12 meters in length (if registered in the commercial register) |
60% |
10.8% |
Motor boats up to 7.5 meters in length (if registered in the commercial register) |
90% |
16.2% |
Craft permitted to sail in protected waters only |
100% |
18% |
- The boat must come to Malta, at least once during the lease agreement.
- The financial leasing agreement shall be between a Maltese company and any Maltese or foreign person or company.
- Prior approval shall be sought 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 craft), as well as the acceptability of the value of the craft as declared. For this purpose a valuation certificate of the craft shall be submitted with the application for approval.
- An initial contribution shall be paid, by the lessee to the lessor, amounting to 50% of the value of the craft.
- The Lease installments 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 boat.
- Any purchase value at the end of the lease agreement shall not be less than 1% of the original value of the craft, and this will be subject to the standard rate of VAT at 18%
If the lessee opts to purchase the craft at the end of the lease, a VAT paid certificate will be issued to the lessee provided that all VAT has been paid.
Example:
Craft with a length of 25meters
Value: |
Lm1,000,000 |
| Down payment: |
Total Payment |
500,000 x 30% = 150,000
VAT = 150,000 @ 18% = 27,000
|
Lm 527,000 |
| |
|
| Installments: |
|
36 monthly installments of 16,667 x 30% = 5,000
VAT = 5,000 @ 18%= 900
|
Lm 17,567 |
| |
|
Redemption:
1% of value = 10,000
VAT = 10,000 @ 18% - 1,800 |
Lm 11,800 |
|
