Since 2010 Malta has taken steps to become a leading jurisdiction of aircraft registry that offers aircraft owners and operators, current and future, an easy and expedient registration procedure and further ease and freedom of intra-Community operation.
Malta’s aircraft registration regime’s openness to many different legal forms and arrangements, non-selectiveness regarding nationality, as well as the non-taxation schemes and other benefits, have proven to be an attractive feature sought after by many foreign entities today. For these reasons Lufthansa Technic, SR Technics, Aviation Cosmetics and VistaJet have established their businesses in Malta.
What are the benefits of registering an aircraft in Malta?
Access to intra-Community traffic rights
Registration of an aircraft and fulfillment of additional requirements for license and certification in Malta, grants the aircraft rights to fly all intra-Community routes within the EU.
A secure EU jurisdiction and legal framework
Malta makes part of the European Union, as well as a contracting party of a number of different international treaties and other agreements, including, double taxation treaties, Cape Town Convention on International Interests in Mobile Equipment and its Protocol, that ensure high level security of interests of stakeholders, including creditors, investors, operators etc.
Availability of Maltese aircraft related services
Malta ensures a broad range of aircraft related services, including aircraft and engine maintenance, repair and overhaul, component manufacture, aircraft management, leasing, aircraft maintenance training and other related support services.
The Maltese law allows any aircraft and its engines to be owned by multiple co-owners provided that fifty percent or more of the owners of the shares in the aircraft fall under the criteria of a qualified person. Each fractional interest is regarded as separate as it can be financed by different creditors, which can take securities over the respective fractional interests, as well as be sold, leased and pledged separately. Under the Cape Town Convention these interests may be considered separate international interests and each fractional interest may be registered in the International Registry. International interests rank prior to national security interests, and once registered to the International Register shall have full effect in Malta.
Ownership through trust
The Maltese legislation acknowledges the rights to own an aircraft through trust. While the trustee may be registered as the owner, the Maltese law ensures the rights of the beneficiaries are enforced against the trustee in case of default. The beneficiaries of the trust are considered for eligibility of the trustee (as a standard procedure for all registration applications), however they shall enjoy confidentiality regarding such ownership.
Broad options of registration
Any type of aircraft can be registered in Malta, including helicopters, airframes, as well as aircrafts under construction. In addition, aircraft engines may also be registered separately, allowing for engine financing opportunities.
Favourable taxation regime for aircrafts
Malta has developed a taxation framework that provides various tax related incentives for owners of aircraft, both private and commercial, registered in Malta.
For example, in case of private aircraft as it is not used for income generating commercial services, its operation is not subject to any tax obligation in Malta. Furthermore, fringe benefits resulting from the use of a private aircraft by non-residents are also not subject to tax in Malta.
In case of commercial aircraft any income which is generated from the ownership, leasing or operation of an aircraft or aircraft engine which is employed in the international transport of passengers or goods is also exempt from Maltese tax, as it is considered to arise outside Malta for Maltese income tax purposes. This provision applies to the leasing of aircraft or its engines by non-residents to Maltese-residents lessees, which would not be subject to Malta income tax. Such schemes may be particularly attractive to foreign companies resident (management and control in Malta), however not domiciled, in Malta.
Beneficial depreciation period for wear and tear
The depreciation of the aircraft and other related objects for wear and tear spans, for instance a minimum of 6 years for an aircraft airframe.
Tax scheme for aviation related personnel
Since the growing of aviation and ancillary services in recent years, there is also a significant need for additional highly qualified workers. In order to attract such highly qualified persons to occupy “eligible office” in companies licensed/recognized by the respective authorities, Malta has developed a tax scheme. This scheme allows workers who have registered under the scheme benefit from a favorable tax rate of 15% on all income derived from employment in Malta in amount of up to €5,000,000 (any excess of this amount is not subject to tax).
The individuals that may opt for the mentioned scheme:
- Aviation Continuing Airworthiness Manager
- Aviation Flight Operations Manager
- Aviation Training Manager
- Chief Operations Officers
- Other aviation related personnel under Qualifying Employment in Aviation (Personal Tax) Rules
Who is eligible?
Persons eligible to register an aircraft:
- An owner operating an aircraft;
- An owner of an aircraft under construction or temporarily not being operated or managed;
- An operator of an aircraft under a temporary title;
- A buyer of an aircraft under a conditional sale or title reservation agreement authorised to operate the aircraft; or
- A trustee for the benefit of beneficiaries.
Who is qualified?
The qualifications of the registrants depend, whether the aircraft is for private or commercial use.
Any natural person who is a citizen of, or undertaking, or established in, a member country of the OECD and any other country approved by the Minister by notice for the purposes of the Act (termed “International Registrant” in the Act), may register a private aircraft on the Maltese register, provided it:
- has legal capacity to own/operate an aircraft in terms of law;
- appoints a local resident agent to represent the owner in Malta for matters concerning the registration of the aircraft;
- complies with applicable regulations/guidelines.
- The Government of Malta;
- A citizen of Malta or a citizen of a Member State of the EU or of an EEA State, or Switzerland, having a place of residence or business in Malta, the EU, the EEA, or Switzerland, including a person sharing in the ownership of such aircraft by virtue of the community of acquests subsisting between such person and a citizen as described above in whose name the aircraft is registered;
- An undertaking formed and existing in accordance with the laws of Malta, of a Member State of the EU, of an EEA State, or of Switzerland and having its registered office, central administration and principal place of business within Malta, or the EU, or the EEA, or Switzerland, whereof not less than 50% of the undertaking is owned and effectively controlled by the Government of Malta, or by any Member State of the EU or by persons referred to above, whether directly or indirectly through one or more intermediate undertakings.
Operator certification and licensing
To carry out any commercial air services within the EU, the following shall be needed:
- Air Operator Certificate (AOC) – necessary for an air transport organisation to carry out any air service within the European Community;
- Air Operator License (AOL) – AOC holders must also possess an AOL, permitting it to provide air services as stated in the operating license, e.g., to carry by air passengers, mail and/or cargo for remuneration and/or hire. AOL is valid within the EU, the EEA and Switzerland.
What are the payable fees?
The fees payable upon application for aircraft registration are competitively low ranging from €60 to €750 depending on the take-off mass or other parameters of the aircraft. As for Air Operator Certificate, the fees payable for the first issue range from €698.81 to €46,587.47 and as for Air Operator Licence – €1,397.62 to €8,152.81.
What we offer our clients?
We provide our clients with full assistance in company establishment, aircraft registration, leasing, obtainment of authorization and licenses, as well as other required ancillary activities for clients establishing themselves in Malta. Being a full service office we offer individually tailored services that best suit the needs of our clients, including consultations on most suitable tax planning opportunities and optimal approaches to business conduct in aviation sphere. Assistance of our partners of great aviation-specific experience, as well as our amiable connection and long standing co-operation with the relevant authorities will ensure smooth implementation of your business or private ambitions.
In case of enquiries, kindly contact us on:
📞 (+356) 2166 1273