VAT – YACHT LEASING SCHEME

The VAT Department has implemented a scheme by virtue of which the payment of VAT upon the purchase of a yacht which is privately used is considerably mitigated.  

 

The scheme takes the form of a leasing arrangement with a purchase option for the yacht at the end of the lease period (which can be of a maximum of three years and a minum of one year). Upon the exercise of the purchase option the vessel/yacht is transferred to the Lessee and a final VAT payment under the Scheme is made. A VAT paid Certificate is then granted accordingly. 

 

APPLICABLE VAT RATES 

 

The applicable VAT rates in terms of the Scheme depend on the length over-all of the yacht. The following are the applicable rates: 

 

Yachts of over 24mtrs : 5.4% 

Yachts between 20.01 – 24 mtrs : 7.2% 

Yachts from 10.01 – 20 mtrs : 9% 

Yachts up to 10mtrs : 10.8% 

 

The term yacht refers both to sailing boats and motor yachts.