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Cyprus yacht registration- New Preferable VAT Treatment
In March 2012 the Cyprus VAT Authority launched a special scheme making Cyprus as one of the most attractive EU jurisdictions for yacht registration.
This new favorable VAT scheme requires a Cyprus company to enter into a lease agreement of a yacht with a third party, paying VAT only on a predetermined percentage of the time that the yacht is deemed to sail within EU waters, hence reducing the effective VAT rate down to only 4,42% when taking into account as well the required profit condition.
- Kinanis LLC
May 2012 – Accounting & VAT Division of Kinanis LLC
In March 2012 the Cyprus VAT Authority launched a special scheme making Cyprus as one of the most attractive EU jurisdictions for yacht registration.
This new favorable VAT scheme requires a Cyprus company to enter into a lease agreement of a yacht with a third party, paying VAT only on a predetermined percentage of the time that the yacht is deemed to sail within EU waters, hence reducing the effective VAT rate down to only 4,42% when taking into account as well the required profit condition.
This tax update explains how the new scheme works, analyses the necessary conditions and provides practical examples on how the scheme can actually be implemented in order to benefit from the reduced VAT rate. It can also be downloaded along with all our other publications from our website at www.kinanis.com/publications.html
The introduction of this VAT scheme, in combination with Cyprus’ perfect geographical location and its favorable tax regime, has elevated the position of Cyprus as an attractive yacht registration jurisdiction that should be considered by all yacht owners who enjoy their boats in international waters.
Our Accounting and Tax Departments are ready to assist you with any clarifications you might need and to provide relevant consultation on the future steps that need to be taken involving yacht registration structures.
For more information please visit www.kinanis.com