Advertisement

Tax Boost News for Yacht Chartering

by isleofman.com 11th February 2010

A discussion (on 3rd February) between representatives of the Isle of Man Yacht Forum, Isle of Man Customs & Excise and HM Revenue and Customs (HMRC) focused on the VAT treatment of yacht chartering or leasing as defined in the Revenue and Customs Brief 56/09.

 

The Brief sets out guidance on possible indicators of abusive practice.   HMRC clarified that provided clear evidence exists of earnestly pursued chartering to third parties which meets the business test and the criteria for economic activity, then there is a legitimate right to recover input tax on the business asset(s), subject to the usual rules for input tax recovery. 

 

Therefore, provided those conditions are met, no uncertainty should be created if a yacht is also used by the person who is the funder or ultimate owner of the chartering entity.

 

A Customs spokesperson stated, "the message to the industry is simple; examine the third party chartering activity.  If this stands up as an economic activity earnestly pursued and can be so evidenced, then Customs will not seek to apply the abuse principle.  What can not be tolerated is sole use of a yacht by the person who is the funder or ultimate owner of the chartering entity".

 

Issues surrounding the application of the Brief to yacht leasing are under further review.

 

Further enquiries on the application or interpretation of RCB 56/09 may be made to IOM Customs & Excise Advice Centre – telephone 648115.

Posted by isleofman.com
Thursday 11th, February 2010 07:01pm.

Popular Articles

Upcoming Events

Nobles Parkrun

A free, fun, and friendly weekly 5k community event in Nobles Park.  Walk, jog, run, volunteer or spectate...
22 Mar
View More
Advertisement

You also might be interested in

Stephen Savage joins Quinn Legal’s Corporate and Commercial legal team.

Business

When the clocks sprung forward we lost another precious hour of sleep

Health & Wellness

The GFoGE guide to obstacle races & why should you do one.

Sports & Leisure

Why not take a "Wallaby" walk in the Curragh?

Nature & Wildlife

Hop-tu-Naa is an ancient festival celebrated on the Isle of Man

Visitor Guide

The Isle of Man hosts many traditional ceremonies throughout the year

Visitor Guide