Category: Aviation

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Hi Fly registered the largest Airbus to date – A380 in Malta

Categories Aviation, Malta, E&S Group, Hi Fly, Airbus, Airline, Malta Aircraft Registry

Hi Fly registered the largest Airbus to date – A380 in Malta

E&S Group is excited to announce that its client Hi Fly has purchased the largest Airbus – A380.

 

Our client, Hi Fly, has registered the largest aircraft to date in Malta, Airbus A380.

Being the largest widebody aircraft wet lease, Hi Fly has a number of aircraft registered with the Malta Aircraft Registry. Hi Fly praises itself on its wet lease services, offering short, medium and long-term contracts to airlines, governments, tour operators, companies and individuals.

Airbus 380

The European manufacturer Airbus designed Airbus 380 to compete with their American competition, Boeing. This double-deck, wide-body, four-engine jet airliner is the world’s largest passenger airliner. Airports have to be fully equipped with adequate facilities to accommodate such airline.

 

If you would like to register your aircraft in Malta, E&S Group is here to help. We offer step by step procedures to register your aircraft in Malta, please visit this link here. You can contact us at [email protected] or  +356 2010 3020.

 

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NEW TAX RULES ON QUALIFYING EMPLOYMENT IN AVIATION

Format ImageCategories Business, Tax, Employment, Regulatory, Aviation

New legislation has entered into Malta’s aviation industry in relation to qualifying employment. The Inland Revenue Department has issued a list of those roles which are considered qualifying. Although the rules came into force on the 24th May 2016, the applications are now available. One should note that the rules apply to individuals not domiciled in Malta.

Individual income from a qualifying contract of employment qualifies under these rules when it is received by a beneficiary in an eligible office. Such  income is subject to tax at a

flat rate of 15% provided that the income amounts to at least 45,000 euros (forty-five thousand euros) annually. The 15% tax rate applies for a consecutive period of five years for European Economic Area (that is, EU countries as well as Norway, Iceland and Liechtenstein) and Swiss nationals and for a consecutive period of four years for third country nationals.

Before applying for this scheme one has to consider all the conditions laid out in the law in order to benefit from the 15% tax.

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VAT TREATMENT OF AIRCRAFT LEASING

Categories Business, Tax, Regulatory, Aviation

On the 5th of April 2016, Maltese VAT Department issued its new guidelines in respect to the VAT treatment for aircraft leasing by which a Maltese structure benefits from a significantly lower effective rate of VAT.

For VAT purposes, except for aircraft used by airline operators in international traffic, the lease of an aircraft is a supply of a service which is subject to VAT with the right of deduction of input VAT by the lessor. This service is taxable according to the use of the aircraft attributed within the airspace of the European Union. Since it is rather difficult to identify the time spent in European Union Airspace in advance, VAT department in Malta has issued the following guidelines for the established percentage proportions according to the maximum range of the aircraft:

 

Aircraft type by Range (KM)

% of lease taking place in the EU

Computation of VAT

0-2,999

60%

60% of consideration x 18%

3,000 – 4,999

50%

50% of consideration x 18%

5,000 – 6,999

40%

40% of consideration x 18%

7,000 – upwards

30%

30% of consideration x 18%

 

These changes will result in the lower effective rate of VAT for a large number of business aircraft.

In order to apply these treatment the following conditions shall apply:

·         The leasing structure requires both the lessor and lessee to be established in Malta.

·         The lease shall not exceed a period longer than 60 months.

·         The lease payments must be made monthly, and VAT paid every quarter.

·          At the end of the lease, the lessee may opt to purchase the aircraft at a percentage of the original cost.

·         If the Lessee exercises the option to purchase the aircraft, a VAT paid certificate will be issued as long as all the VAT due under the lease has been paid.

·         The Commissioner for Revenue in Malta has the right to request the lessor to submit details of the use of the aircraft.

·         Prior approval of the value of the aircraft and the applicable percentage of the lease subject to VAT shall be obtained in writing from the Commissioner for VAT.

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