Avoiding VAT on aircraft imported to EU
Join Date: Mar 2006
Location: london
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VAT on private aircraft
this is an old thread but the original question remains valid: if I buy an aircraft for private use can I create a structure to reclaim the VAT on the purchase price? Clearly if it is 100% business use then there will be no problem but what about the private buyer?
Are there any ploys/structures that can be created by clever advisers? For instance, what if a spouse buys the plane; registers for VAT as a plane charter business; reclaims the VAT; and then leases the aircraft to me at £x per hour (+VAT). Would that work for VAT purposes (and/or would there be any Benefit in Kind income tax charges, in the UK)?
Basically, is there any way of reclaiming the VAT when buying a plane that is primarily intended for private use?
Are there any ploys/structures that can be created by clever advisers? For instance, what if a spouse buys the plane; registers for VAT as a plane charter business; reclaims the VAT; and then leases the aircraft to me at £x per hour (+VAT). Would that work for VAT purposes (and/or would there be any Benefit in Kind income tax charges, in the UK)?
Basically, is there any way of reclaiming the VAT when buying a plane that is primarily intended for private use?
Join Date: Oct 2005
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There are variety of less onerous ways of achieving the same objective...all legal, and all require solid experienced professional setup.
This isn't a place for amateur hour or info from golfing/pilot buddies....with all respect...no more than your aviation lawyer or financial advisor is a good reference for crosswind landing technique discussions.
Send me a private mail and I can provide a lot more background.....
This isn't a place for amateur hour or info from golfing/pilot buddies....with all respect...no more than your aviation lawyer or financial advisor is a good reference for crosswind landing technique discussions.
Send me a private mail and I can provide a lot more background.....
Join Date: Apr 2002
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Mr. Flyer is correct. There are many structures available to offset the VAT. The possibilities of paying VAT 0 rated are long gone. It now takes professional tax advisors and lawyers to lay out the ground work to make the structures work.
This is a time and money exercise that will ultimately see you paying VAT in some form.
The basic principle is that Goverments (especially EU) are looking to capitalize on any revenue stream. They are more than aware that an owner is not interested in paying 20% VAT on his/her $50,000 or $60 million aircraft, and will avoid this.
The structures that are devised are that a VAT will be paid and will draw down over the life of the aircraft as long as that owner has it in the form of VAT on lease payments and or on a AOC as charter.
The point being (and I am no expert) you cannot avoid it you can only defer the VAT.
As is suggested there are two options either pay the VAT upfront and be done with it. Or go down the path of tax hell and get a structured VAT plan.
Just make sure that you have the T12 in the aircraft for a customs visit.
2cents worth
This is a time and money exercise that will ultimately see you paying VAT in some form.
The basic principle is that Goverments (especially EU) are looking to capitalize on any revenue stream. They are more than aware that an owner is not interested in paying 20% VAT on his/her $50,000 or $60 million aircraft, and will avoid this.
The structures that are devised are that a VAT will be paid and will draw down over the life of the aircraft as long as that owner has it in the form of VAT on lease payments and or on a AOC as charter.
The point being (and I am no expert) you cannot avoid it you can only defer the VAT.
As is suggested there are two options either pay the VAT upfront and be done with it. Or go down the path of tax hell and get a structured VAT plan.
Just make sure that you have the T12 in the aircraft for a customs visit.
2cents worth
