It has become common practice to register yachts and other marine vessels under another flag than the country, where the vessel is used or where the owner lives. This is not illegal practice, and it can have some significant advantages for the owner or operator. Malta has become an interesting choice for yacht owners to register their yacht on the islands and offers certain advantages that can help you save money.
Who can register the yacht
A yacht that is being registered and purchased in Malta needs to be wholly owned by either a European or Maltese citizen, a Maltese company or a corporate body that is in accordance with the Merchant Shipping Act. It is also possible to register the yacht through a Maltese shipping company, which is a company that is especially set up for the ship, and bears certain advantages for the owner. Establishing the company can be processed quickly, and the office of Dr. Werner & Partner can help you with everything needed to complete the application. After the company has been established, and the ship has been purchased, the ship becomes property of the company. If the company is registered by someone not residing on the Maltese islands, then an agent who is resident on the islands has to act on behalf of the person or company.
Saving taxes with the purchase of a yacht
One thing that makes the Maltese islands so attractive for the yacht registration or reflagging is that the taxation is much more favourable. It can make a huge difference if you buy the yacht in the UK or Malta. For example, if you have to pay 20% VAT in the UK, this rate would not be applicable in Malta. Taxation of a yacht depends on the size, use (leisure or commercial) and the type (motor yacht or sailing yacht).
In order to avoid errors with the purchase or registration we recommend to always use the services of a legal office in Malta to assist you with the necessary paperwork. If you would like a personal consultation with one of our partners you are welcome to contact our office.
