LJ Fiduciary: Corporate Yacht Ownership and it’s benefits
A Yacht owning Company or SPV (Special Purpose Vehicle) is seen by many as a way to simply own a yacht but there are a number of other benefits; privacy, personal tax and estate planning, VAT, yacht chartering, ring fencing and flagging.
Privacy is an important element for many yacht owners and yacht ownership through an SPV can help insulate the owner against personal intrusion. SPV’s, whether onshore or offshore, should also limit the liability of the beneficial owner to the value of the assets in the structure and thus reducing their unlimited liability exposure through personal ownership.
The tax residency of the beneficial owner should always be considered and structured ownership through an SPV can have a positive impact on the personal tax treatment and estate planning objectives of the beneficial owner. Yachts planning to operate privately or for charter in the EU must consider VAT and each case has to be looked at on its own merits, but there are a number of different structuring arrangements through an SPV to help manage EU VAT obligations.
Each Flag State has its own qualifying criteria for registration and in some cases an individual may not qualify in their own name for their flag of choice and therefore ownership through an SPV in a qualifying jurisdiction can provide the solution.
In summary, Corporate yacht ownership provides many benefits but each structure needs to be considered on its own merits. Professional advice should be sought at the outset as every yacht and operation is unique and therefore every SPV is bespoke to the individual needs of each owner.