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COMMERCIAL AND CORPORATE FLYING IN THE EUROPEAN UNION

A quick overview of aircraft importation/admission issues - mainly for non-EU operators How to choose between Temporary Admission and full importation

APRIL

03 Operating inside the European Union? 3 What to do? 3 Figure 1: Flying in the European Union

03 Temporary Admission 4 4 4 5 6 6 6

Private or commercial use of aircraft Figure 2: Flying in the European Union Passenger and crew allowed on board Entity responsible for flight in the European Union Aircraft registration Period of stay in the European Union Aircraft usage

6 7 7 7 8 8 8

Figure 3: Flying in the European Union Option 1: Paying the import VAT Option 2: Reclaiming the import VAT Option 3: The import VAT is exempt Risks when using leasing agreements and reclaiming import VAT Customs duty and end-use exemption Extra resources

06 Full importation

09 What is the real difference between Temporary Admission and full importation 9 Figure 4: What you can and cannot do 9 Figure 5: Risks and liability

10 Conclusion 12 About OPMAS

2018

UP DA TE D

AN INCL G E UD S M ES AD LAT E B ES YT T HE

EU


Operating inside the European Union?

If a non-EU company operate inside the European Union (EU) with a non-EU registered aircraft, the company may have to import the aircraft into the EU and manage the exposure to EU Value Added Tax (VAT) and customs duty. You may already know this and you probably also know the old aircraft importation regimes in the United Kingdom and Denmark offering VAT exemptions ceased in January 2011 and 2010. The customs procedures related to customs duty (end-use exemption) changed drastically in 2015-16 and again late 2017. VAT treatment has also changed recently primarily in relation to leasing structures. This continues to leave many operators without a clear view of current EU aircraft importation issues and without the necessary knowledge to choose the most effective procedure for unrestricted access to enter into and operate within the EU. As VAT rates are between 15% and 27% and customs duty rates are between 2.7% and 7.7%, this is a very important aspect to consider before commencing or continuing EU operations. Please be aware that the descriptions of respectively Temporary Admission and full importation may be simplified and does not necessarily describe the full set of conditions.

What to do?

When operating an aircraft, you ONLY have the following options: Temporary Admission (TA) or full importation into free circulation. An operator does not have to file any paperwork if the aircraft is used by a third person established outside the EU and the aircraft does not carry any EU residents, conditioned upon the operator having full knowledge of the authorities’ practical usage and understanding of the TA Regulation in the various EU member states they plan to visit. If the aircraft has a more complex flight pattern or carries EU residents - or you just want to avoid any uncertainty when flying in the EU, inclusive of any uncertainty of what kind of flying you do; private vs commercial use of aircraft, we recommend using TA backed by local customs advice, the so-called Secure Temporary Admission procedure (STA). Please note: any aircraft flying into the EU must somehow come under EU customs control either using TA regulation or full importation, there is no other options. So, if the aircraft is NOT already fully imported, it will automatically be considered as flying under the TA regulation - see figure 1. If the aircraft is not eligible for TA or is violating the regulation, the aircraft could be forced into a full importation, meaning paying the VAT and also the customs duty - see figure 3.

Figure 1: Flying in the European Union

Importation status versus privileges and restrictions for flying within the EU Importation status of aircraft

Imported into the EU

Not imported into the EU

Domiciled in the EU customs territory

Flying is not restricted Aircraft is in free circulation

Flying is not allowed in the EU

Not domiciled in the EU customs territory & aircraft with EU customs territory registration

Flying is not restricted Aircraft is in free circulation

Flying is not allowed in the EU

Not domiciled in the EU customs territory & aircraft with non-EU customs territory registration

Flying is not restricted Aircraft is in free circulation

Flying regulated by the Temporary Admission (TA) regulation

Entity responsible for aircraft and registration

Temporary Admission

To qualify for TA and be eligible for conditional relief of customs duties and VAT, the aircraft must be registered outside the EU and – as a basic rule – be used privately by a non-EU resident person or company. TA involving EU residents and/or commercial activities comes with certain restrictions and limitations but is possible. The primary intention of the relief is to grant the user free access to fly unhindered in the EU member states. If the conditions are met, TA is a paperless routine and admission is granted automatically when crossing EU borders - see figure 2. Some of the common issues surrounding the use of TA are discussed on the following pages. Please note that our Secure Temporary Admission procedure (STA) addresses most of the issues mentioned below. 3


Private or commercial use of aircraft

The definitions of ‘private’ use and ‘commercial’ use are specific definitions used by the EU customs authorities in relation to TA and should not be compared with similar definitions used by aviation regulators as these definitions are used in a different context. A flight deemed as ‘private’ use basically grants with a lot of privileges when flying in the EU whereas ‘commercial’ use may be restricted. The usual safe ‘private’ use definition is an aircraft owned by a private individual where the usage of the aircraft is solely private; such as flying with family and friends for visits and holidays and where the purpose of the flight is never commercially oriented. The definition of private versus commercial use of aircraft has historically given rise to discussions within member states and the EU Commission. However, in 2014 the EU Customs Code Committee took a stand and published a working paper with samples of ‘private’ versus ‘commercial’. The conclusions were; - Corporate flights may be considered private use - Group charters may be considered private use under certain circumstances - Marketing material and corporate documents on board are acceptable and are not considered to be freight/cargo and thus commercial use of the aircraft - EU residents are allowed on board but with certain restrictions The working paper was based on 4 different cases and consisted of a description of each case supported by the EU Customs Code Committee’s comments and recommendations. Please note that the working paper is only an opinion from the EU Customs Code Committee and thus not binding on the EU member states or the European Court of Justice.

An operator should be very careful when using the guidelines in the working paper without consulting customs authorities in the various EU member states they plan to visit.

Figure 2: Flying in the European Union Is the use of Temporary Admission possible?

Entity responsible for aircraft

Aircraft registration

EU registration 1)

Non EU registration 2)

Domiciled in the EU customs territory

No

No

Not domiciled in the EU customs territory

No

Yes

1) 28 EU member states, Isle of Man and Guernsey/Jersey. 2) San Marino is outside the EU Customs territory.

Passenger and crew allowed on board

The rule of thumb states that a TA aircraft on an internal EU flight should not carry any EU residents on board with the exception quoted from the EU Union Customs Code (2016) - please see text in italic:

Watch a short presentation on how to fly in the European Union If you want to know how to fly within the European Union (EU) without problems please have a look at this new short video we have produced. The video includes the latest 2018 EU customs changes and is mainly targeting non-EU corporate/private operators, like the US Part 91. The video is produced in January 2018. Visit our website at: www.opmas.dk/short-presentation/

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‘Natural persons who have their habitual residence in the customs territory of the Union shall benefit from total relief from import duties in respect of means of transport which they use commercially or privately provided that they are employed by the owner, hirer or lessee of the means of transport and that the employer is established outside that customs territory. Private use of the means of transport is allowed for journeys between the place of work and the place of residence of the employee or with the purpose of performing a professional task of the employee as stipulated in the contract of employment. At the request of the customs authorities, the person using the means of transport shall present a copy of the contract of employment.’ It is not set in stone who is – according to the EU Union Customs Code – deemed a ‘user’ of an aircraft and whether there is any difference between EU resident passengers and the crew but working papers from the EU Customs Code Committee mentions that the above paragraph about EU-residents does only relates to the pilots meaning; there are no restrictions for EU-residents passengers. Particularly with respect to EU residents, some member states within the EU may have limitations and restrictions as to who may be carried within their borders and how.

Entity responsible for flight in the European Union

The entity responsible for the TA entry is called the declarant and should normally be the operator. The operator is, in general, the entity which employs the crew and provides services to keep the aircraft flying. If the aircraft is managed by a third party, the management company should be the operator. This is often a situation with a lot of pitfalls, as most aviation structures include many different entities such as user, owner, operator, lessee and lessor, etc. We regularly see a declarant nominated randomly and is therefore not a valid operator or sometimes a declarant is simply chosen because it is the only non-EU entity in the owner/operator/user structure. It is important that the declarant is acceptable as the real, physical operator and can prove this fact as well as claim responsibility as the operator. The declarant must, of course, be a non-EU resident. KNOW MORE: See survey 6: which entity is allowed to be the declarant? ICELAND

SWEDEN FINLAND

The 28 European Union member states marked with red IRELAND

UNITED KINGDOM

NETH.

EU member states territories outside the VAT area but inside the customs territory: • Finland: Åland Islands • F rance: The overseas departments, including the French Guiana, Martinique, Guadeloupe and Réunion •G  reece: Mount Athos • I taly: Livigno, Campione d’Italia and The Italian part of Lake Lugano • S pain: Ceuta, Melilla, The Canary Islands, including Gran Canaria, Tenerife, Fuerteventura, Lanzarote and Gomo •G  ermany: Helgoland and Büsingen EU member states territories outside the VAT area and the customs territory: • The Great Britain: Gibraltar • Cyprus: North Cyprus Countries and territories outside the EU but within the VAT area(*) and the customs territory: • Monaco* • Isle of Man* •C  yprus: The base areas of the United Kingdom* • The Channel Islands, including Jersey, Guernsey, Alderney and Sark

GERMANY

BELGIUM LUX.

CHANNEL ISLANDS

The following countries and territories are not a part of the EU: •G  reenland together with a series of British, French and Dutch overseas territories, e.g. New Caledonia, the Netherlands Antilles and the British Virgin Islands • Faroe Islands • The Channel Islands, including Jersey, Guernsey, Alderney and Sark • Andorra, San Marino and the Vatican City • Monaco • Isle of Man

United Kingdom including: EST. RUSSIA England LAT. Scotland Northern Ireland LAT. RUS. Isle of Man BELARUS Channel Islands including POLAND SWEDEN Jersey, Guernsey, Alderney and Sark UKRAINE CZECH REP.

DENMARK

ICELAND EU - special member state territories: Dots and areas marked with blue have speciel rules regarding vat.

Brexit areas

NORWAY

SLOVAKIA

FRANCE

AUSTRIA

SWITZ.

SLOVENIA

ROMANIA

CROATIA

BOS. & HER.

ITALY

PORTUGAL

FINLAND

MODOVA

HUNGARY

NORWAY SERBIA

MONT.

SPAIN

BULGARIA

KOS.

ALB.

MAC.

ESTONIA

GREECE

RUSSIA

TURKEY LATVIA

TUNISIA

MALTA

DENMARK

SYRIA

LITHUANIA

CYPRUS RUSSIA

MOROCCO

ISRAEL

ALGERIA

IRELAND

UNITED KINGDOM

LIBYA NETH.

LUX.

CHANNEL ISLANDS

POLAND

GERMANY

BELGIUM

BELARUS

JORDAN

EGYPT

UKRAINE

CZECH REP. SLOVAKIA

FRANCE

AUSTRIA

SWITZ.

MODOVA

HUNGARY

SLOVENIA

ROMANIA

CROATIA

ITALY

PORTUGAL

BOS. & HER.

SERBIA

MONT.

KOS.

ALB.

SPAIN

GREECE

TUNISIA

MOROCCO

BULGARIA

MAC.

TURKEY

MALTA

S CYPRUS ISRAEL

ALGERIA

5

LIBYA

EGYPT

JOR


Aircraft registration

The aircraft must be registered outside the EU customs territory. The Isle of Man and the Channel Islands are part of the EU customs territory and, for that reason, aircraft registered at Isle of Man (M) or Channel Islands (2/ZJ) are considered ‘registered in the EU’. Aircraft registered in the EU are not eligible for TA and are thus not allowed to fly in the EU customs territory without the payment of customs duty and VAT – not even a single entry into the EU is allowed. All aircraft using an aircraft registration within the EU customs territory must be fully imported at the first port of call in the EU if not already imported. San Marino (T7) is not inside the EU customs territory hence TA may be used. The registered owner/operator mentioned on the certificate of registration must of course also be domiciled outside the EU customs territory. KNOW MORE: See survey 5: does the nationality of the aircraft registration matter?

Period of stay in the European Union

An aircraft assigned to the ‘private’ use category will be allowed a stay up to 6 months at a time in the EU. When the aircraft crosses EU’s external borders, a new 6 months period will begin. The TA regulation cannot be used if the aircraft has its normal home base or is spending the majority of time at the same place in the EU. This would be considered circumvention and may result in the payment of customs duty, VAT and a fine. An aircraft assigned to the ‘commercial’ use category will be allowed to stay for the time required to carry out the transport operation, often referred to as ‘period of discharge’. An EU form is available for documentation purposes. This form is called the ‘Supporting document for an oral customs declaration’ Please be informed that very few customs officials are familiar with this form and lack experience in handling the form. You should make arrangements well in advance with a local handling agent if you want to use this form. KNOW MORE: See survey 7: how is the 6 months period of stay practically interpreted? KNOW MORE: See survey 8: what is the limit for multiple continuous stays at the same place? Supporting document for an oral customs declaration

Aircraft usage

The aircraft can be used for any purpose, such as private, leisure, entertainment, business/corporate use (Part 91), and commercial group charters (Part 135) without any consequence for the customs/VAT handling but under the condition that the aircraft will be used in the EU for passenger transportation without any ticket fee.

Full importation

Many operators usually prefer to fully import an aircraft into one of the EU member states and settle VAT in order to be able to fly unrestricted in the EU. The import VAT can be fully paid, reclaimed or can be VAT exempt at zero rate - see figure 3.

Figure 3: Flying in the European Union

How the import VAT may be handled during a full importation? Remarks Type of operation

VAT handling used

Conditions/notes

Option 1: Private owner or company not using aircraft for VAT taxable economic activities

- Import VAT is imposed at local rate and cash paid – and cannot be reimbursed later on

- The VAT payment must be seen as a cost

Option 2: Operated/owned by company utilized for business use or as a business for 100% VAT taxable economic activities

- Import VAT is imposed at local rate and reclaimed without any cash payment - Import VAT can be initially be partly reclaimed if size of private use of aircraft is known

- Importer must be the legal owner - Aircraft must be used 100% as a business tool - No use of circular leasing - Potential private use must be handled correctly, if VAT is reclaimed 100%

- Import VAT is exempt = 0% VAT

- Importer must be a holder of an AOC/ charter certificate issued by an internationally recognized civil aviation authority - Aircraft must be used for charter in pursuit of business for the airline

Option 3: Operated by an international airline

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Option 1: Paying the import VAT

This option is the only alternative for the private owners/companies with activities which is not considered as VAT taxable economic activities like real estate, banking/finance, insurance, gaming, holding companies and other not listed activities. The import VAT must be paid and cannot be reimbursed later on.

Option 2: Reclaiming the import VAT

The procedure reclaiming the import VAT is available for aircraft owned and utilized by a company or as a business. As a rule of thumb - if it is a company generating a turnover at arm’s length prices and it will make a profit in the long term, the VAT due on the aircraft may be reclaimed upon importation. Reclaiming is conditioned upon the company being subject to VAT and the use of the aircraft being linked to the company’s VAT taxable economic activities. Aircraft must be used for the correct activities Any importers using this option should initial check what kind of activities the aircraft will be used for in the future and again check whether or not these activities are considered a VAT taxable economic activity in the EU member state where the importation is planned. It is always a good idea to continuously check that the usage of the aircraft is as planned and is still considered a VAT taxable economic activity. The definitions of the latter can change over the years, mainly due to recommendations from the European VAT Committee which are again based on judgements of the European Court of Justice (ECJ). The VAT procedure is the same for any EU established company in any EU member state. It is all based on national legislation however, the procedure requires paperwork which differs from member state to member state. Know what you are signing up for Nobody should sign-up for this option without knowing the full set of conditions, the risks and the on-going demand for a detailed documentation for the correct use of the aircraft. Most EU member states have a period of limitation for 5 years but the relevant documentation must be filed for 7 years and must be shown on demand during an audit. Written approvals by local customs authorities or legal opinions are available and recommended in most cases. Only for business use - unless handled correctly It is a common misunderstanding that it is acceptable to reclaim all of the import VAT even if the aircraft is only used predominately for business purposes. The general rule is that the import VAT can be reclaimed 100% only if the aircraft is used 100% for acceptable VAT taxable economic activities. Any person using the aircraft for private/­personal/­entertainment purposes must compensate the importer directly for the use – otherwise the importer will have to pay the “non-business” part of the imposed import VAT back to the VAT authorities. KNOW MORE: See survey 1: is the term “predominately used for business” accepted by various EU VAT authorities? Not compatible with imputed income and SIFL The use of imputed income to compensate any private/personal/entertainment use of a corporate aircraft is generally not accepted and will not exclude an EU VAT claim. Please also be aware of the US use of SIFL will not solve the compensation problem as these values are often too low to be considered market-rate. All non-business uses worldwide matters It is also important to stress that most EU VAT authorities will not differentiate between non-business use in and outside the EU. This means that any non-business legs flown e.g. in the USA by an American Part 91 corporate operator will actually have an impact on the EU VAT handling if the aircraft has been fully imported in the EU and the import VAT has been reclaimed 100%. KNOW MORE: See survey 3: does the flight pattern/geography and size/type of compensation matter?

Option 3: The import VAT is exempt

The procedure with import VAT exemption is available for aircraft used by companies with an international airline (AOC or charter certificate holder). Some providers offer a procedure where one company is established to act as lessor and another company to act as lessee creating lessee ‘airlines’ without an AOC. However, that solution is not in line with EU regulations. In the latest decision by the European Court of Justice in a case referred by the Finnish courts, a charter operator with an AOC was approved for 0% VAT. It follows from this judgement that an AOC is generally a requirement to be recognized as an airline in the EU. Non-AOC holders cannot be considered airlines.

An aircraft registered with Isle of Man (M) registration is only allowed to fly in the EU with a full importation 7


Using the international airline procedure, no VAT is imposed, as the rate is 0%. Most EU member states, including Denmark and the UK, require the aircraft to be used for charter. Since the judgement by the European Court of Justice in the A Oy case, it has been widely accepted that a leasing company leasing an aircraft to an airline may also benefit from the VAT exemption as a supplier. The exemption is not limited to the immediate supplier. The entire chain of lessors/lessees, etc. will qualify if the end-user is an international airline. KNOW MORE: See survey 2: what does various EU VAT authorities require to accept an aircraft as VAT exempt?

Risks when using leasing agreements and reclaiming import VAT

The Council Directive on the common system of value added tax (the VAT Directive) regulates the authorities right to claim and the companies right to reclaim VAT. Uncertainty as to the correct application of the provisions of the VAT Directive in the case of full importation of leased aircraft gave rise to consultations with the European VAT Committee back in 2013. Based on judgements of the European Court of Justice (ECJ) and opinions previously expressed by the European VAT Committee, the VAT Committee made it unambiguously clear that the importation of a leased aircraft is subject to import VAT and that neither the customs representative nor the lessee is entitled to reclaim VAT. Consequently, some EU member states have declined lessees domiciled in the EU access to reclaim import VAT arguing that the lessees have not incurred the costs of acquisition and do not, in fact, own the imported aircraft. In 2015, the Legal Division of the Danish Customs and Tax Administration published a draft administrative act pointing out that a lessee cannot reclaim import VAT. Based on input from the industry, the Danish Customs and Tax Administration identified that this approach – denying lessees to reclaim import VAT – led to situations whereby both the lessee and the lessor were denied the right to reclaim import VAT. The issue of the lessee’s right to reclaim import VAT – or lack of such right – was revisited by the European Commission in 2017, and once again the European Commission made it clear that the lessee did not have a right to reclaim import VAT. The risk of being denied access to reclaim VAT should also be taken into consideration if using circular leasing agreements. Circular leasing agreements that do not, in fact, change the ownership or do not, in fact, imply any transfer of the right of disposal of the aircraft have been banned and may be considered as circumvention in the EU. Please be cautious if the importer is not the real owner of the aircraft. Always ask yourself – which entity has the depreciation allowance and right of disposal of the aircraft? Not only Denmark but also Germany and the Netherlands have now adapted the above-mentioned VAT Directive and is denying lessees the right to reclaim import VAT according to the below-mentioned survey 4

KNOW MORE: Read more about this issue on opmas.dk under “June 2017 news”. KNOW MORE: S ee survey 4: has a lessee been denied the right to reclaim/recover the VAT imposed during an importation?

Customs duty and end-use exemption

As per January 1st 2018, a civil aircraft can be imported for free circulation with relief from customs duties if the aircraft has been duly entered on a register of a Member State or a third country in accordance with the Convention on International Civil Aviation (ICAO) dated December 7th 1944. Importation with customs relief per January 1st 2018 is no longer conditioned upon applying for end-use procedure. Importation of civil aircraft can be made under customs relief by reference to the valid certificate of registration in the customs declaration for release for free circulation. Please note that the presence of the relevant certificate on board of each aircraft is mandatory.

Extra resources

Online resources to cover Temporary Admission and full importation Please check links at www.opmas.dk/links HM Revenue & Customs (UK) – guideline to Temporary Admission and full importation The best and most detailed guide – covering the UK way of doing it • Temporary Admission introduction • Notice 3001: customs special procedures for the Union Customs Code EU Commission • EU Union Customs Code • Supporting document for an oral customs declaration • About Temporary Admission (importation) NBAA (USA) • Aircraft Operations to Europe • International Customs Duties and Taxes: Know Before You Go

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Even though the above-mentioned conditions are fulfilled, the customs duty can still be an issue in cases where an aircraft is smuggled in, wrongly or false declared through a full importation, if the aircraft is using TA but is not eligible for TA or is violating the TA regulation. KNOW MORE: Read more about this issue on opmas.dk under “October 2017 news”.

What is the real difference between Temporary Admission and full importation

If you want to see the differences in detail we suggest that you have a look at the OPMAS Quick Guides. These guides are showing limitations, potential liability, no-gos, and include procedures which continuously must be handled correctly. Everything is listed point by point showing what you can and cannot do - in a short and precise way. KNOW MORE: See our Quick Guides for a deeper insight and comparison The below figures are based on the EU Customs Code (UCC) and various EU working papers. This is in our opinion the correct interpretation of the regulations but all EU member states have not necessarily implemented everything at present. Most non-EU operators will practically have the same flying privileges using TA as given under full importation as the few limitations does not influence the typical flight - see figure 4.

Figure 4: What you can and cannot do Simplified pros/cons list for a non-EU operator What you can and cannot do

Full importation

Temporary Admission

Flying to one EU destination

Possible

Possible

Flying internally in the EU

Possible

Possible: up to 6 months per stay, and multiple entries are allowed

Fixed base or longtime parking

Possible

Not Possible

EU passengers on internal legs

Possible

Possible

EU crew on internal legs

Possible

Possible

Full importation includes a lot of potential risks and liability which nobody wants – and without any gain for the typical non-EU operator. An aircraft using TA can be used for any purpose, such as private, leisure, entertainment, business/corporate use, and commercial group charters without any consequence for the customs handling - see figure 5.

Figure 5: Risks and liability

Simplified pros/cons list for a non-EU corporate operator Risks and liability

Full importation

Temporary Admission

The VAT handling Import VAT imposed must be paid back if incorrectly applied

- Requires 100% usage for accepted VAT taxable economic activities continuously for 5 years and 7 years of record keeping - Owner must import (EU working paper # 762)

No risk

Private/personal/ entertainment use of a corporate aircraft Import VAT imposed must be paid back if incorrectly applied

-N  on-business use not allowed unless handled correct compensation wise - Non-business part is not allowed to reclaim upfront (survey 1) - Term ´Predominately used´ is not accepted anywhere (survey 1) - An EU import requires correct handling of worldwide nonbusiness use - Imputed income will not solve compensation problem - SIFL will not solve compensation problem, value is often to low

No risk

EU Tax/VAT liability Comes with establishment and local EU economic activities, etc

-Maybe, depending on set-up

No risk

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Conclusion

Many non-EU operators can benefit from TA without any help from customs experts. We will, of course, be glad to assist in more complex cases and you are always welcome to contact us and hear about the options at no charge. We will send you our input to any questions the same day and quite most within 1-2 hours. We recommend using TA and, if your intended flights involve multiple legs inside the EU and you want to carry EU residents on board, we have our Secure Temporary Admission procedure (STA) whereby we can eliminate all risks. Please enquire. Many non-EU operators will have the same flying privileges under TA as under full importation, as the limitations do not influence the typical flight pattern. TA offer the declarant more flexibility and extra advantages such as unrestricted personal/family/guest use without consequences and no tax/VAT liability anywhere. Please see a list of benefits below: - No cash payment of VAT or customs duties is required - No VAT liability anywhere in the EU - No customs duty liability anywhere in the EU - No VAT and import registration is required in Denmark or anywhere in the EU - No bond/security for import duties is required - No on-going economic activity or activity subject to VAT required anywhere in the EU for the next many years - No fiscal liability anywhere - No tax/VAT consequences when visiting other EU member states – you can fly freely in the EU - No need for a formal export of aircraft when eventually sold or lease/operating agreement is terminated (EURO 5-7,000 saved eventually) - No VAT consequences when corporate aircraft are used for non-business activities (entertainment or personal use) by executives - No need for due diligence to verify the ownership structure of the aircraft - No change of the current aircraft registration or set-up of other contractual agreements like circular leasing structures, etc - Less record keeping compared to a full importation based on an EU VAT and import registration Many of the above points are often an issue when using full importation. Our advice has always been to ask for a ruling from the customs authorities before an importation in order to eliminate any doubt as the details of all cases are different and EU member states may have a different opinions. This applies whether you intend to do a full importation or use TA with a complex flight pattern: Always ask for an assessment notice from the authorities! If you have any questions or comments, please email me directly: lr@opmas.dk Best regards OPMAS Lasse Rungholm CEO, Attorney at Law (L) ATP MEL & MES lr@opmas.dk

Please contact us if you want further explanations on your options should you consider flying within the EU 10


Want to know more?

All PDF’s can be downloaded from www.opmas.dk

COMMERCIAL AND CORPORATE FLYING IN THE EUROPEAN UNION

COMMERCIAL AND CORPORATE FLYING IN THE EUROPEAN UNION

The “airline” VAT exemption in the European Union

A brief introduction to VAT in the European Union

2 3 3 4 5 6

All AOC holders can be “airlines” if their operation is chiefly international Is a charter operator also an “airline”? Must it be the airline itself taking supply? Does the actual usage of the aircraft matter? So what can be learned from this? About OPMAS

FEBRUARY 2017

FEBRUARY 2017

About the “airline” VAT exemption

About EU VAT

Our interpretation of the judgement from the European Court of Justice which allows 0% VAT full importation for international charter operators

Read this review if you want to get a quick overview of the European Union VAT system

THE OPMAS QUICK GUIDES

THE OPMAS QUICK GUIDES

Quick guide for private and corporate aircraft / Part 91 operators or similar

Quick guide for international AOC / Part 135 charter certificate holders or similar

This Quick Guide is covering the typical case: Where an aircraft is owned/operated by a company or legal entity and used for private and corporate purposes

We do proudly introduce these Quick Guides after many requests to present the two importation alternatives in a different way.

NOVEMBER 2017

NOVEMBER 2017

The Quick Guides is covering the typical cases: Where an aircraft is operated commercially by international AOC / Part 135 charter certificate holders

Private and corporate aircraft / Part 91 operators or similar

International AOC / Part 135 charter certificate holders or similar

The Quick Guide is covering the typical case: Where an aircraft is owned/ operated by a company or legal entity and used for private and corporate purposes

The Quick Guide covers the typical case: Where an aircraft is operated commercially by international AOC Part 135/ charter certificate holders

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ABOUT OPMAS

member of

At OPMAS, we have dealt with aircraft customs handling for more than two decades. This is the only service we provide. We are not involved in financing, offshore tax structures, tax planning or yachting etc. We focus strictly on aircraft importation and admission matters for aircraft owners and operators flying within the EU. Over these last 20 years, we have learned that long-term local presence and knowhow are essential when it comes to aircraft importation and admission in order to avoid unpleasant surprises. Our experienced acquired knowledge and strong and invaluable handling with the Danish authorities ensure a smooth handling process.

COPYRIGHT

The copyright belongs to OPMAS and all rights are reserved. Referencing this document is allowed naming OPMAS as the source.

DISCLAIMER

Sonderborggade 9 DK-8000 Aarhus C Denmark Phone: +45 70 20 00 51 www.opmas.dk

APRIL18

The information and opinions contained in this document are for general
information purposes, are not intended to constitute legal or other professional advice, and should not be relied on or treated as a
substitute for specific advice relevant to particular circumstances. The information contained in this document is intended solely to provide general guidance for the personal use of the reader, who accepts full responsibility for its use.

OPMAS REVIEW · About Aircraft importation  

Start here if you want to get a quick overview over aircraft importation in the European Union. www.opmas.dk

OPMAS REVIEW · About Aircraft importation  

Start here if you want to get a quick overview over aircraft importation in the European Union. www.opmas.dk

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