Isle of Man Aircraft Registration and Management

ISLE OF MAN AIRCRAFT REGISTRY

The Isle of Man Aircraft Registry was established in May 2007 and has attracted over 175 registrations to date. It operates under the UK as the contracting state to the Chicago Convention on International Civil Aviation.The prefis is M, plus four additional characters eg M-ANXX

It is recognised for its client-focussed service, speed of response and competitive charging structure, whilst operating to the highest international standards.

Key benefits include:

• First dedicated corporate aircraft register in a European time zone;

• Stable legal and political environment - S&P AAA rated jurisdiction

• 24/7 registration service;

• Cost effectiveness;

• High service levels, speed of registration;

• International reputation;

• High regulatory standards;

• No insurance premium tax – UK 5%;

• Zero corporate tax;

• Neutral nationality registration prefix – can be personalised eg M-YJET;

• Secure mortgage register;

• Global survey team.

Isle of Man Aircraft Registry

HOW CAN IFG HELP?

The main issues that impact on the structuring in this regard are:

• Ownership eligibility for IOM register, residence - Commonwealth or EEA;

• Acquisition of a new build jet – whether inside or outside of the EU;

• Acquisition of a pre owned jet – protect VAT paid status;

• Use of jet – private or third party – dry lease agreement;

• VAT mitigation on acquisition and/or charter.

Our clients’ main requirements are as follows:

• A suitable structure to provide confidentiality and limit personal liability, based on personal or commercial use;

• VAT mitigation or minimisation;

VAT RELATED ISSUES

This is a complex area and requires specialist advice. IFG International Limited can assist in obtaining suitable advice in this regard via its network of professional advisors.

The Isle of Man is neither part of the UK nor of the EU, but is treated as such in relation to VAT by virtue of protocol 3 to the UK’s Act of Accession, and therefore forms part of the customs territory of the EU. In most respects, the VAT legislation applying in the Isle of Man is identical to that of the UK.

Advantages:

• VAT registration at short notice;

• VAT paid status for EU acquisition;

• Intra community supply VAT at 0%;

• Ability to reclaim VAT on acquisition / import;

• Ability to reclaim VAT on IOM / UK expenses;

• Ability to reclaim VAT on aviation fuel;

In terms of importation of aircraft into the EU, whether VAT is charged is dependent on the maximum take off weight. If an aircraft has a take off weight of less than 8,000kg then VAT will be liable at the standard rate, whilst those in excess of 8,000kg will be zeo rated.

DRY LEASE ARRANGEMENTS

The Isle of Man Aircraft Registry allows private or corporate useage of aircraft on its register via a dry lease, ie hiring of the aircraft only, without the provision of a pilot or crew. The VAT liability on any subsequent lease will follow the rates set out above.

A SPV (Special Purpose Vehicle) may be used to provide a place of business for Isle of Man VAT registration. VAT supplies will be in the form of a Dry Lease agreement

OUR SERVICES

• Aircraft registration;

• Corporate ownership structures, establishment and administration – as required;

• Finance;

• VAT - implementation of planning, registration and returns;

• Accounting services;

Associated services including insurance, administration and liaison with the Isle of Man Aircraft Registry.

IFG does not provide taxation or legal advice. The information and expression of opinion expressed in this briefing note are not intended to be a comprehensive study or to provide taxation or legal advice. Specific advice concerning individual situations should be taken and IFG can provide introductions to advisers who specialise in this area.Please note that some of the services referred to above may be provided by a suitable third party firm known to IFG International Limited.