VAT on private jets and yachts imported into the Isle of Man

For many years individuals have imported private jets and yachts into the Isle of Man using a structure that meant no VAT was payable – or if it was it could be reclaimed. While the Isle of Man’s VAT legislation does not differ significantly from that of the UK the local registration process proved to be more user friendly.

In autumn 2017 leaked documents – colloquially known as the ‘paradise papers’ – put a spotlight on the import of aircraft and yachts to the island. The media took the view that this practice amounted to unacceptable tax avoidance. The Treasury then began to investigate releasing a review in October 2019 (the Isle of Man aircraft and yachts VAT review – tinyurl.com/yyslaxho). This article examines the findings of that review and the implications...