PART 4: AVIATION SECTOR SERIES
An aircraft registration is a unique, identifying set of numbers and letters, which relate specifically to a single aircraft. It is required by international convention to be marked on the exterior of every civil aircraft, just like you would a car registration.
The first few letters and/or numbers of a registration indicate the aircraft’s country of registration. This unique identifier must also appear on its Certificate of Registration, as issued by the relevant national aviation authority.
An aircraft can have only one registration, in one jurisdiction, at any one time; although it is changeable over the lifetime of an aircraft and will often change when the ownership of the aircraft changes.
How do you decide where to register an aircraft?
The large majority of corporate aircraft are registered where their owners are based, as well as in their principal area of operation. However, there are an increasing number of owners that move around the globe, operating internationally, who are keen to look at other jurisdictions which offer other distinct advantages.
The number of jurisdictions which have launched registries, or that are opening up the eligibility criteria for their existing registers, continues to increase. Whilst the registration process in each case is broadly similar, each registry aims to offer a unique selling point and these factors need to be taken into account when making a decision on where to register an aircraft.
Considerations that require thought include:
In the first instance, when deciding where to register, the owner of a business aircraft should consider whether the intended use is purely private, for corporate-private use, or whether it is to be chartered. The answer to this will then decide the registration process they need to follow. For example, the majority of offshore registries, i.e. the Isle of Man, only offer registration for corporate-private use aircraft.
But there are just so many registries we hear you say! So how do you figure out the most suitable one for your needs?
Let’s consider an offshore registry which caters for all three scenarios; take Aruba as an example.
Aruba provides owners with the option to register both private and commercial aircraft. Great, you say! However that’s not it, the next step is to look further and consider other important factors such as Tax.
Aruba has no Income Taxes, no Corporate Taxes, no VAT, no Excise Tax, no Sales Tax, no Import Tax and no Stamp Tax.
But, Aruba’s market is high-end. You cannot register an aircraft more than 30 years old, licensing can cost upwards of USD 15-20,000 per year for an aircraft with a maximum take-off weight of 5,700kg, or in the case of a larger aircraft, the cost can be upwards of USD 65,000 per year.
[Insert shocked face emoji]… Looks like it is going to cost you a lot of money to maintain that registration, even with all of those advantages.
But it doesn’t have to… Let’s keep looking further – Why not consider an EU registry?
In Malta, aircraft registration fees are one of the lowest in Europe. As a comparison, the registration fees for a large aircraft such as an A320 would be in the region of €10,000; this is significantly lower to the offshore jurisdiction making it well worth considering.
Malta also has some great fiscal incentives for aircraft companies and related service providers, including: a 15% flat rate of tax for aviation employees; low to no income tax through its imputation tax regime; no stamp duty as well as many more incentives.
If you are unsure what jurisdiction would be most suited to your aircraft and requirements, get in touch.
With a comprehensive understanding of the industry as well vast experience in structuring the ownership and registration of a range of aircraft, including business jets and helicopters, we can give you the wings that leave you free to fly in the knowledge that your aircraft is structured, registered in a way that is compliant, effective and makes for efficient operation.
For more information on our aviation services click here.