Aircraft Registration

Aviation is a growing industry in Malta, and actively encouraged through a number of highly attractive fiscal opportunities, such as competitive registration fees and operational costs.

Several benefits are in place for aircraft (and their engines) registered under the Malta flag, whether these are aeroplanes or helicopters.

The Maltese aviation sector has grown from a small registry established over 30 years ago, to a well-respected international registry. Our focussed strategy includes a sound legal framework and a broad network of service providers across the industry.

As Malta is an EU Member State, it is party to key international aviation conventions.

Malta has implemented EASA’s standards in aviation, while also providing highly attractive fiscal incentives on VAT and highly competitive registration fees and operational costs, in addition to minimum depreciation periods for aircraft, recognition of fractional ownership and much more.

Accession to the Cape Town Convention on International Interests in Mobile Equipment and its Aircraft Protocol has served to bolster the value that registration in Malta brings to aircraft owners and financiers alike.

This alignment with international conventions and standards has placed Malta at the forefront as a jurisdiction of choice for aircraft registration.

In addition, as an EU member, the Malta aviation registry is well-respected and supported by a sound legal framework and a broad network of service providers across the industry.

In bankruptcy or insolvency matters, all owner claims have security preference over other creditors. Ownership and security rights for the aircraft and its engines are treated separately if the aircraft belongs to different owners, regardless of whether the engines are attached to the aircraft.

Self-help is available in the event of a mortgage default, without resorting to the courts. Subject to giving notice to the debtor, the owner may sell, take possession in full (or a share portion), maintain registration or lease and/or receive payments and income from the aircraft

Malta’s taxation system is based on the principle of domicile. A single-purpose vehicle (SPV) or a company owning a single asset, incorporated outside Malta, and therefore not domiciled in Malta, will not be subject to Maltese tax exception where the income is remitted to Malta. This is subject to certain conditions relating to ‘effective management and control’. It is important to note that some tax treaties limit this benefit.

To register an aircraft in Malta, the applicant must meet specific eligibility criteria. The register is open to a wide range of individuals and corporate entities, making it an accessible and attractive option for international owners.

Eligible registrants include:

– Citizens of the European Union, the European Economic Area (EEA), or Switzerland, residing or having a registered office in one of these jurisdictions.

– A company or undertaking formed in accordance with the law of Malta, an EU Member State, an EEA state, or Switzerland, with its registered office, central administration, and principal place of business within these territories.

– A natural person who is a citizen of, or a company established in, an approved jurisdiction outside the EU/EEA, provided they appoint a resident agent in Malta.

This framework allows for significant flexibility, particularly for non-EU owners who can establish a Maltese corporate structure or appoint a local representative to meet the requirements. Acumum can advise on the optimal structure for your specific circumstances.

Registering an aircraft in Malta involves a clear and structured process managed by the Civil Aviation Directorate (CAD) of Transport Malta. While we handle the complexities for you, the typical process follows these key stages:

1. **Reservation of Registration Marks:** The process begins with an application to reserve the desired Maltese registration marks (e.g., 9H-XXX).
2. **Submission of Application and Documentation:** We will prepare and submit the formal application for registration on your behalf. This includes providing essential documentation such as proof of ownership (Bill of Sale), details of the aircraft, evidence of de-registration from any previous registry, and due diligence information on the owner or operator.
3. **Technical Inspection and Airworthiness Review:** The CAD will conduct a thorough review of the aircraft’s technical records and may require a physical inspection to ensure it complies with all applicable EASA airworthiness standards.
4. **Issuance of Certificate of Registration:** Once all legal and technical requirements are satisfied, the CAD will issue the Certificate of Registration, formally placing the aircraft on the Maltese register.

Our team ensures a seamless and efficient process, liaising directly with the authorities at every step to prevent delays and ensure full compliance.

At Acumum, we provide end-to-end support for aircraft owners, operators, lessors, and financiers. Our dedicated aviation team manages every aspect of the registration process and ongoing compliance to ensure your assets are structured and protected effectively.

Our services include:

– Advising aircraft owners, operators, lessors, and financiers on all aspects of Maltese aviation law.

– Assisting in the set-up, financial operation, and administration of an Aircraft Operating Certificate (AOC).

– Managing aircraft transactions, including sales, purchases, and financing arrangements.

– Handling the registration of private and commercial aircraft, jets, and helicopters.

– Drafting, reviewing, and negotiating aviation-related agreements, such as leases and mortgages.

– Managing structures for VAT and tax planning optimisation to leverage Malta’s fiscal benefits.

The finance lessee is considered the owner of the aircraft, rather than the finance lessor. This results in the following benefits:

• Lessor: Tax is only levied on the full amount of the lease income, if responsible for maintenance, and tax depreciation for wear and tear can also be deducted.
• Lessee: Can deduct 100% of the amount of lease payments, if responsible for maintenance, and tax depreciation for wear and tear can also be deducted.

• Lessor: Taxed only on the interest portion of the finance charge, which is income.
• Lessee: Regarded as the owner, they can deduct finance charges and costs for repairs, maintenance and insurance, and claim tax depreciation.

Depending on the structure employed, importation of the aircraft into the EU may be arranged so that no VAT is levied.

There is an automatic exemption of VAT for aircraft operating under an AOC. Private jets (not operated under an Aircraft Operating Certificate) are not entitled to benefit from any VAT exemptions on importation of the aircraft into the EU. However, in 2020 Malta introduced a policy allowing for the importation of private registered aircraft involved in operational leasing under certain conditions.

It’s possible to accelerate the depreciation of engines, airframe and other parts. The minimum periods are as follows:

In Malta, any person or business involved in repairing, overhauling, or maintaining aircraft, engines, or related equipment may benefit from investment tax credits against the tax due on chargeable income.

Unutilised investment tax credits may be carried forward against tax due in subsequent years at a multiplied amount.

Our services include:

• Advising aircraft owners, operators, lessors and financiers
• Assisting in the set-up and administration of an
  Aircraft Operating Certificate (AOC)
• Financial operation of an AOC
• Assisting parties during aircraft transactions
• Registration of private and commercial aircrafts, and helicopters
• Drafting and reviewing aviation-related agreements
• Assisting with applications for AOCs and AOLs
• Managing of structures for VAT and tax planning optimisation