Whilst Cyprus has long been considered as a primary jurisdiction for registration of yachts in Europe, the amendment of the Cyprus Yacht Leasing Scheme (the “Scheme”) as this has been effected with the issuance by the Cyprus Tax Department of Circular 188 on 11th September 2014 is making Cyprus’ yacht Scheme being described as one of the most attractive VAT yacht regimes in Europe, with the lowest effective cost in terms of VAT rate reduced drastically to 2.42%.
The Scheme’s main aim is to allow yacht owners minimize their VAT and income tax leakages, whilst obtaining an EU VAT-paid certificate at the end of the leasing scheme when they exercise the option to acquire the yacht.
To find more information about the Cyprus Yacht Leasing Scheme including a practical example please follow the below link.