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Cyprus yacht vat taxation special scheme

 

Cyprus yacht vat taxation special scheme for short–term chartering

A short-term charter agreement of a yacht is an agreement whereby the yacht owner / operator enters into an agreement for the use of a yacht that cannot exceed 90 days.

The short-term charter to be used for leisure purposes is taxable at the standard rate of 19%. According to Cyprus taxation laws the tax liability arises where the yacht is actually available for the customer.

Before calculating the Cyprus yacht vat tax liability of 19% it is important to calculate the use of yacht within EU territorial waters. Though is very difficult to physically trail the movement of a yacht, certain percentages are set by the tax department which they correspond to the length of the yacht and its power to sail.

Cyprus yacht vat taxation table

Yacht Type

% of charter deemed to be taking place in the EU

Computation of Cyprus tax on yachts

(% of deemed charter X Cyprus yacht vat taxation rate)

Sailing boats or motor boats over 24 metres in length

30%

30% of taxable value X 19%

Sailing boats between 20.01 to 24 metres in length

40%

40% of taxable value X 19%

Motor boats between 16.01 to 24 metres in length

40%

40% of taxable value X 19%

Sailing boats between 10.01 to 20 metres in length

50%

50% of taxable value X 19%

Motor boats between 12.01 to 16 metres in length

50%

50% of taxable value X 19%

All other boats

100%

100% of taxable value X 19%

Cyprus yacht vat taxation table is applicable subject to certain conditions set by the Cyprus tax department

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The authors expressly disclaim all and any liability and responsibility to any person, entity or corporation who acts or fails to act as a consequence of any reliance upon the whole or any part of the contents of this publication.

Accordingly no person, entity or corporation should act or rely upon any matter or information as contained or implied within this publication without first obtaining advice from an appropriately qualified professional person or firm of advisors, and ensuring that such advice specifically relates to their particular circumstances.

PKF Cyprus firms are member firms of the PKF International Limited network of legally independent firms and do not accept any responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.

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