VAT and taxes on aircraft ownership — what to understand

The tax side is settled together with the choice of ownership structure, not after the purchase. It can be reworked later, but at a price: the aircraft has to be taken out, re-registered and sometimes imported again.

What the tax picture is made of

• payments on import — they depend on the customs regime chosen
• taxes tied to ownership — calculated from who holds the aircraft and where it is registered
• the tax consequences of operation — private flights and commercial carriage live by different rules
• leasing — a separate construction with its own logic of payments

Specific rates, reliefs and the conditions for applying them change with the regulations. We always check the calculation against the rules in force as at the date of the deal, and we bring in specialist tax advisers where the question goes beyond aviation practice. Promising a “scheme” in advance is a disservice: that is precisely how owners end up with additional assessments.

Private operation or commercial

This is the main fork in the road. Commercial operation opens up the possibility of selling spare hours and changes the way incoming payments are treated, but it requires a certificated operator holding an AOC, the maintenance rules that go with it and the corresponding paperwork.

Private operation is simpler to administer and harder on the economics: every cost stays with the owner. The choice is made on the planned annual flight hours and on whether you are prepared to share the aircraft with other people's flights.

Ownership structures — what is chosen in practice

There are not many options: an individual, a Russian company, a foreign company, a leasing construction. Each has its own cost of entry, its own regime on import and its own consequences on sale.

• an individual — simple to administer, limited on deductions and on commercial operation
• a company — more demanding in accounting, but it opens up incoming payments and charter
• a foreign structure — today this calls for a separate check of applicability and risks
• leasing — payments instead of capital outlay, but the aircraft is not yours until it is bought out

The choice is driven not by a “scheme” but by your operating scenario and your ownership horizon. We cost out two or three options in money terms and show where the difference arises.

Frequently asked questions

Can VAT be reclaimed on the purchase of an aircraft?

The answer depends on the ownership structure and on how the aircraft is operated. There is no universal “yes” here — it is decided on the specific configuration of the deal, together with a tax adviser.

Is an aircraft subject to transport tax?

Aircraft are among the objects of taxation. The calculation depends on the type of aircraft and on the region where the owner is registered.

Which is cheaper from a tax point of view — owning through a company or as an individual?

There is no single answer: what has to be compared is the whole picture — import, ownership, operation and the eventual sale. We cost out both scenarios before the deal.