AVIATION

Selling an aircraft across borders can be complex, particularly when EU VAT and customs export procedures are involved. Proper understanding of these rules is essential to protect the transaction and preserve the aircraft’s value.

The “VAT-paid” status of an aircraft is not permanent and must be reassessed with each transaction. To ensure compliance, the seller must be VAT-registered in the EU and correctly account for VAT, either by charging the applicable rate or by validating the buyer’s EU VAT number and issuing a compliant invoice in line with Directive 2006/112/EC. Where the buyer is established outside the EU, the sale may qualify for VAT exemption, provided sufficient proof of export is obtained. This highlights that VAT applies to the transaction rather than the aircraft itself.

From a customs perspective, a formal export procedure under the Union Customs Code is required whenever an aircraft leaves the EU. Filing an export declaration ensures proper documentation of departure and supports the VAT exemption.

Failure to comply with these requirements may result in the loss of VAT benefits and significant tax exposure, making careful planning and execution essential.