Ireland has many advantages for those wanting to own and operate an aircraft, writes Angie Deady-Fiddler, director Martyn Fiddler Aviation Ireland Limited.
Ireland offers aircraft owners and operators an attractive tax regime as an on-shore EU and OECD (Organisation for Economic Co-operation and Development) member state. The country has a very strong and growing network of double taxation agreements (more than 70 to date) and is the home of the International Registry of Mobile Assets established under the Cape Town Convention, for which the Irish High Court has jurisdiction.
The 12.5% nominal rate of corporate tax is supplemented by a range of exemptions and allowances which enable an appreciably lower effective rate.
In 2011, the definition of ‘qualifying asset’ in section 110 of the Taxes Consolidation Act 1997 was extended to include aircraft, making it very tax-efficient to incorporate a special purpose vehicle in Ireland for aircraft financing and leasing.
Brexit offers further opportunity in Ireland for owners of business aircraft. Owning a business aircraft through an Irish company allows VAT registration and reclaim within the EU. An Irish VAT registered company can import their aircraft via Ireland, accounting for VAT, and obtaining EU free circulation, something that a UK company will no longer be able to do when the UK leaves the VAT region of the EU.
The opportunities are not just for Irish-owned aircraft but also for aircraft operated by an Irish AOC on the Irish register.
Irish Aviation Authority EI- and EJ-registration
The “EI” register tends to be used mostly by commercial aircraft. The IAA also has the ‘EJ’ register which has been in existence for many years, however has only recently been ‘re-activated’ and effectively re-purposed for business, or executive jets (EJ) and can now be seen on the tail of business aircraft.
The EJ Register builds on Ireland’s reputation and know-how to offer a very attractive registry solution for business aircraft. Administered by the Irish Aviation Authority, the EJ register offers a range of advantages to aircraft owners and operators ranging from EASA compliance to asset security and favourable tax treatment.
Martyn Fiddler Aviation
Martyn Fiddler Aviation has been a pioneer in the areas of customs, VAT and aircraft ownership for over 30 years. We are present in several jurisdictions within Europe, and in late 2019 expanded into Ireland with an office at Shannon. That decision was influenced to an extent by Brexit and allows us to offer our varied solutions to clients who wish to own or operate an aircraft in an EU jurisdiction.
Our aim is always to bring innovative solutions to the marketplace, to offer what people need, not just what they expect and to always ensure that we are within the letter and the spirit of the law.
In a post Brexit world, we wanted to be able to offer solutions based in an onshore EU jurisdiction, which has economic and legal stability and a good international reputation. We wanted a jurisdiction where aviation is a familiar, accepted and recognised industry and a skilled work force already exists. For us the standout jurisdiction, therefore, was Ireland.
Ireland is already a ‘gold standard’ jurisdiction for commercial airliner registration and a world centre of the air finance industry; this meant that so many of the aspects we were looking for were present. The closer we looked the more we understood that the legal and taxation regime in Ireland, derived through commercial aircraft leasing, also had certain advantages for business aviation.
As a licenced Corporate Service Provider “CSP” Martyn Fiddler Aviation Ireland can structure and manage SPC’s for their Clients aircraft. We also offer formal tax advice through our Martyn Fiddler Tax division, as well as the full range of customs import and export services to support our client’s needs.
