ECS International is proud to announce that it has extended the range of services that it provides with the establishment of ECS Marine Services, which provides yacht registration and administration services in Gibraltar and Isle of Man.
Gibraltar is excellently equipped to service the yachting industry, whether small crafts or super yachts. Should you decide to avail yourself of the Yacht berthing at Gibraltar's three private marinas; Queensway Quay, Marina Bay and Sheppard's Marina are all capable of accepting vessels with drafts of up to 4.5 metres and can boast an extensive variety of bars and restaurants.
However, Gibraltar has more to offer the yacht owner than just its berthing facilities. The Rock of Gibraltar is also a British Port of Registry which means that all vessels registered in Gibraltar fly the Red Ensign. Aided by a favourable tax regime and the lack of VAT, Gibraltar is one of the most attractive locations to register pleasure craft intended for use in European Union and world-wide waters.
Owners should be aware of the VAT consequences of owning and sailing a yacht in EU waters. Any pleasure yacht owned by an individual or company, which is resident in the European Union (EU) Customs Union, will have paid VAT on the purchase of the yacht. It will have to account to the VAT authorities of the Member State for VAT on any charters whether inside or outside EU waters. A VAT paid yacht will encounter no difficulties in sailing in EU waters, provided that the vessel is not chartered. NB. Pleasure yachts built prior to 1985 and in EU waters on 31 December 1992 are treated as having paid VAT.
Pleasure yachts in EU waters are subject to VAT on the cost of the vessel and any charters commencing and finishing in EU waters. However those pleasure yachts whose owner is non-EU resident or whose charter company is non-EU resident will be free from VAT on entering EU waters in the following cases:
- As long as the yacht is not in EU waters for more than six months in total in any twelve month period, it can apply for a Temporary Importation Certificate which gives it relief from VAT
- Any charter commences and finishes outside of EU waters.
There are therefore advantages of owning and chartering a pleasure yacht in Gibraltar
- Gibraltar is an EU territory but is outside of the Customs Union and therefore does not levy VAT.
- Gibraltar is a British port of registry.
- Gibraltar allows companies who trade outside Gibraltar (e.g. Charter companies) to obtain Tax Exempt Status.
- Gibraltar allows a wide range of qualified individuals or corporate bodies to own a registerable vessel including EU nationals, Gibraltar companies, or companies registered under the laws of other EU countries (as long as they have either a place of business or have appointed a representative person in Gibraltar).
Thought will need to be given as to whether a yacht should be registered in the name of an individual or through a tax efficient vehicle such as a tax exempt Gibraltar company. ECS International have developed a high level of sophistication in providing high quality service to those people wishing to use offshore jurisdictions for proper personal or corporate planning and business activities. Over the years we have gained substantial expertise in the use of many offshore jurisdictions around the world and have established very good working relationships with the authorities in these areas.
ECS Marine Services are also able to offer a number of opportunities to mitigate the cost of VAT whilst maintaining the ability to reclaim the VAT on the acquisition of the vessel through its Isle of Man office. In 2003 new regulations were introduced, which enables commercial yachts (over 24 metres) to be registered in the Isle of Man. These new regulations have been extremely successful in attracting the "Superyacht" or "Megayacht" to the Isle of Man.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.