COMMERCIAL AND CORPORATE FLYING WITHIN THE EUROPEAN UNION
A quick overview of aircraft importation and admission issues
– mainly for non-EU operators
Operating inside the European Union?
If a non-EU operator operates inside the European Union (EU) with a non-EU registered aircraft, the operator will have to import or admit the aircraft into the EU and manage the exposure to the EU’s Value Added Tax (VAT) and customs duty.
The customs procedures related to customs duty, including the handling of end-use exemption, changed drastically in 2015-2016 and again in late 2017. The VAT treatment has also changed in relation to leasing structures and the 0% VAT airline exemption. The Temporary Admission (TA) procedure got a large boost in 2014 after the Union Customs Code Committee took a stand and published a working paper that clarified many of the issues of the practical usage of this procedure. TA was earlier known as a risky option but is now a safe and flexible way to fly within the EU if applied correctly and has now become the preferred option for most international operators.
Yet, in 2025, many non-EU operators are still left without a clear overview of the current EU aircraft importation and admission issues and the necessary knowledge to choose the most effective procedure for their needs when operating within the EU. With VAT rates between 17-27% and customs duty rates between 2.7-7.7%, aircraft importations and admissions are important to consider before commencing or continuing EU operations. Compliance is always a central issue when using the TA and full importation procedure, as non-compliance will most likely activate a direct payment of the VAT and customs duty.
Introduction
Any aircraft flying into the EU will fly under customs control using either TA or full importation. There are no other options. If the aircraft is not already fully imported, the aircraft will automatically be considered as flying under TA even though the owner or operator has not themselves taken any action to activate this procedure or realized that their aircraft is flying under TA. The TA procedure is thus always required for non-EU imported aircraft, even for flights with only one stop within the EU. The TA procedure can only be used by EU outsiders where the aircraft is owned (including any UBOs), operated, registered, and based outside the EU, leaving EU insiders only one option: full importation.
All private individuals and corporations, regardless of nationality and residence, can use the full importation procedure to realize a free circulation status and act as the importing entity, but some scenarios require full payment of the VAT of the aircraft’s value. The full importation procedures are available in all EU member states, but the practical handling and preconditions are often different. Full importation is mandatory for EU insiders, which includes aircraft that is either owned, registered, operated, based, or mainly used within the customs territory of the Union (just one criterion must be fulfilled) but optional for EU outsiders. See Figure 1.
Figure 1: Flying within the European Union
The importation status is significant for privileges and restrictions when flying within the EU.
|
Importation status
of aircraft Entity
responsible for the aircraft and aircraft registration |
EU imported | Non-EU imported |
| Entity responsible for the aircraft is domiciled within the EU | Flying is not restricted and the aircraft is in free circulation |
Flying is not allowed within the EU |
| Aircraft is registered within the EU, while the entity responsible for the aircraft is domiciled outside the EU | Flying is not restricted and the aircraft is in free circulation |
Flying is not allowed within the EU |
| Aircraft is registered outside the EU, and the entity responsible for the aircraft is domiciled outside the EU | Flying is not restricted and the aircraft is in free circulation |
Flying is regulated by the Temporary Admission procedure |
Both TA and full importation can be used commercially, corporately, and privately if applied correctly.
The descriptions of TA and full importation are simplified in this publication and do not necessarily describe the full set of preconditions. For deeper insight, please have a look at some of OPMAS’ other publications, such as our Short & Sweet articles, Short Stories, and other publications. For your convenience, we have included selected links to enlighten you on the issues mentioned on the following pages.
If you have a concrete case, please inquire for a more detailed overview of the various full importation or TA options.
To simplify the matter, this overview will use the terms EU and customs territory of the Union synonymously. It is important to notice that the two terms do not cover the same area, yet the differences are only relevant for strictly legal matters.
Temporary Admission
To qualify for the TA procedure and thereby be eligible for conditional relief of the customs duty and VAT, the aircraft must be registered or owned outside the EU and operated by a non-EU-resident person or company. It is possible to carry EU-resident persons as well as carry out commercial activities with the use of the TA procedure. A few limitations and situations must be avoided, but only when flying within the EU.
The primary intention is to grant EU outsiders free access to fly unhindered in and amongst all EU member states. If the preconditions are met, TA is a simple procedure for most operators. Some of the common issues surrounding the use of TA are discussed on the following pages.
How does Temporary Admission work?
The use of TA is designed to be a paperless process with a voluntary option to document entries and exits using a Supporting Document, meaning that a qualifying aircraft can enter the EU without any customs contact or paper declarations. It is the EU Commission’s opinion that the bare act of crossing the outer EU border counts as a customs declaration. Over the years, it has become evident that a common misunderstanding persists: some operators believe the TA procedure is irrelevant or optional if an aircraft’s passengers or pilots reside outside the EU or hold non-EU passports. This is not the case, and such misconceptions have left many operators unprepared and at risk. Operators must understand the requirements and ensure TA compliance for all flights within the EU.
Temporary Admission is supposed to be paperless, so why is documentation needed
Unfortunately, the paperless entry and exit procedure has created another common misunderstanding, namely that an operator is not required to present relevant documentation to prove TA compliance upon request from customs. This is incorrect. Only the entry and exit are supposed to be paperless, but the operator must continuously live up to the preconditions of TA, handle the limitations correctly, and be able to document these at any time, even if flights are just in and out of the EU with only one visited destination. Correct documentation proving TA compliance is a make-or-break issue during customs ramp checks, and the so-called Supporting Document (if used upon entry) does not prove TA compliance alone.
To learn more, please view our explainer video about the topic.
Temporary Admission is not without preconditions
When flying to the EU under TA, the qualifying aircraft must adhere to certain preconditions and be granted a suspension of all normal EU taxes and duties. Yet, there will naturally be random customs checks, ensuring that all TA terms are correctly fulfilled and documented. Failure to adhere to or document the terms properly will most often have consequences. Here, the lack of relevant documentation has stopped or grounded several aircraft over the years. The risk is that the aircraft will be stopped or impounded until TA compliance has been verified and documented or, in a worst-case scenario, until payment of all taxes and duties has been made.
Grey zone areas
The use of TA within the EU is based on a vague convention text, which, over the years, has created many different local interpretations and, hereby, grey zone areas. Click here to see a list of the known grey zone areas where different interpretations of the TA procedure exist and where operators often need guidance to use TA safely. None of the grey zone areas create problems against using TA if correctly handled and documented.
Activation of TA
Again, the EU Commission states that the bare act of crossing the outer EU border counts as a customs declaration. TA is simply activated (knowingly or not) every time an unimported aircraft crosses the outer EU border and is terminated again when the same aircraft crosses the EU’s external border on the way to a non-EU destination.
Supporting Document
If found beneficial, an EU-published document is available to document an EU entry and exit voluntarily. This form is called the Supporting Document for an oral customs declaration. If used, the mentioned Supporting Document does not grant or approve any TA compliance, nor does it grant free circulation for a six-month period. The Supporting Document only acknowledges that the aircraft has arrived within the EU and is opting to fly under TA – nothing else. A well-prepared flight to the EU requires more documentation than the eventual use of the SD.
We recommend that operators read the following articles before starting a trip.
| Short & Sweet mail no. 6 | Flying with EU-resident persons onboard when using TA |
| Short & Sweet mail no. 9 | Part 1: What is the Supporting Document, and how do you use it? |
| Short & Sweet mail no. 11 | Part 2: What do customs look for during a ramp check, and why? |
| Short & Sweet mail no. 14 | Part 3: In which scenarios will an operator need help or guidance? |
Private or commercial use of aircraft
The definitions of private use and commercial use are specific definitions used by the EU customs authorities in relation to the TA procedure and should not be compared with similar definitions used by aviation regulators as these definitions are used in a different context. A flight deemed private use grants many privileges when flying within the EU, whereas flights considered commercial use might be restricted.
The definition of private versus commercial use of aircraft has historically given rise to discussions within EU member states and the EU Commission. However, in 2014 the Union Customs Code Committee took a stand and published a working paper with samples of private versus commercial use.
The important conclusions of the 2014 working paper were:
– All private and corporate flights are considered private use.
– All commercial flights are considered private use as long as there is no passenger transport subject to a personal ticket fee or a direct payment per person.
– EU residents are allowed onboard internal EU flights both as crew and passengers, but certain limitations and situations must be handled correctly
The 2014 working paper was based on four different cases and consisted of a description of each case supported by the Union Customs Code Committee’s comments and recommendations. Please note that the working paper is only an opinion from the Union Customs Code Committee, thus not binding in any EU member state or the European Court of Justice. However, the above definition of private use is fully adapted in most EU member states, including Denmark.
Passengers and crew onboard
The Union Customs Code (2016) states:
“Natural persons who have their habitual residence in the customs territory of the Union shall benefit from total relief from import duties in respect of means of transport which they use commercially or privately provided that they are employed by the owner, hirer or lessee of the means of transport and that the employer is established outside that customs territory.
Private use of the means of transport is allowed for journeys between the place of work and the place of residence of the employee or with the purpose of performing a professional task of the employee as stipulated in the contract of employment.
At the request of the customs authorities, the person using the means of transport shall present a copy of the contract of employment.”
Therefore, it is not set in stone who – according to the Union Customs Code – is deemed the user of an aircraft and whether there is any difference between EU-resident passengers and the crew, but various working papers from the Union Customs Code Committee stipulate that the above paragraph concerning EU residents only relates to pilots, which means that there are no restrictions for EU-resident passengers.
Aircraft registration
The aircraft must be registered outside the EU. The Isle of Man and the Channel Islands are post-Brexit no longer a part of the customs territory of the Union. Consequently, aircraft registered at the Isle of Man (M) or Channel Islands (2) are now eligible for TA within the EU. Aircraft registered in the EU are not eligible for TA and are thus not allowed to fly in the EU without paying customs duty and VAT – not even a single entry is permitted. The registered owner or operator mentioned on the certificate of registration must also be domiciled outside the EU. As San Marino (T7) is not a part of the EU nor the customs territory of the Union, the TA procedure can be used for this registration without any problems.
Period of stay
An aircraft assigned to the private use category will be allowed to stay in the EU for up to six months at a time. When the aircraft crosses the EU’s outer border, a new six-month period can begin. The TA procedure cannot be used if the aircraft has its normal home base within the EU or spends the majority of the time in the same place within the EU. This would be considered circumvention and may result in payment of the customs duty, VAT, and a fine. An aircraft assigned to the commercial use category will be allowed to stay for the time required to carry out the transport operation, often referred to as the period of discharge.
Aircraft usage
Please note that TA can be used to fly privately, corporately, and commercially within the EU without any problems and with EU-resident persons onboard if applied correctly. Since 2014, the TA procedure has become a very well-defined customs procedure, especially for corporate and commercial aviation. The TA procedure discussed in this overview is only meant for Means of Transportation (MoT) primarily used for transportation of persons and cannot be used for special mission aircraft where the purpose is, e.g., firefighting, any survey or surveillance work, or aerial photography, etc.
Be prepared to meet the EU customs when using Temporary Admission
Operators should always consider how to check and document TA compliance as well as handle and secure the known grey zone areas when using TA, which is why a compliance test is fundamental before flying to the EU. The relevant documentation can be conditioned without help from OPMAS, but we will be happy to help and have years of experience with this process. We offer different TA documentation solutions depending on the risk profile and typical flight pattern. Please inquire for more details.
Put simply, an operator must:
a) prepare and check whether the aircraft operation and structure meet the basic preconditions,
b) check whether all limitations are handled correctly,
c) explore and understand all the grey zone areas, and
d) conduct a compliance test to evaluate the above
In addition, an operator must choose between:
a) not preparing any documentation, taking things as they come, which we do not advise,
b) prepare own suitable documentation in-house by own legal adviser, or
c) ask OPMAS to do a compliance test and generate the needed documentation
Being ready for a customs ramp check should be seen parallel to how an operator prepares for an eventual SAFA ramp check. Most operators do not realize that failing a customs ramp check could have consequences that outweigh the costs of failing a SAFA check manifold. Various TA problems are related to the operators’ inability to understand and document the correct use of TA. We believe it is not worth the risk of being stopped and delayed for hours or days when minimal effort could avoid such a scenario.
Legal background for Temporary Admission
The Istanbul convention from 1990, regulating the worldwide usage of TA, is not very precise, and the EU Commission has been and is continuously publishing various working papers and guidelines to clarify the correct understanding of TA and its usage in the EU. The 2014 working paper from the Union Customs Code Committee (available in English, French, and German) is especially important. Operators should always be aware that these documents are not binding for EU member states, which is why different interpretations exist between member states, thus also why it is important to have a competent customs agency outlining the correct use and understanding based on the specific setup.
We recommend that operators read the following articles to learn more about TA.
| What are the 10 typical errors and misunderstandings? | Compilation of the most typical errors and misunderstandings when using TA |
| The short story about TA | Learn more about the essence of TA |
Full importation
Some operators will also have the option to fully import an aircraft into one of the EU member states and settle the VAT to fly unrestricted within the EU. The import VAT can be fully paid, deducted, or VAT-exempt at a 0 % rate – See Figure 2.
Figure 2: Flying within the European Union
Examples of how the import VAT may be handled during a full importation.
|
Remarks
Type of
operation |
VAT handling | Conditions and notes |
| Option 1: Private owner or company not using the aircraft for correct economic activities |
The import VAT is imposed at the local rate and cash paid, which cannot be reimbursed later | The VAT payment must be seen as a cost |
| Option 2: Owned and operated by a company and utilized 100% by this company for business purposes |
The import VAT is imposed at the local VAT rate and later deducted without any cash payment | The aircraft must be used 100% in furtherance of the economic activities of the importing entity |
| Option 3: Operated by an int. charter operator, e.g., AOC holder, Part 135 charter certificate holder, or similar |
The import VAT is exempt = 0% VAT | The aircraft must be used 100% commercially, e.g., operated on group charters |
Option 1: Paying the import VAT
This option is the only alternative for private owners or companies with activities that are not considered correct economic activities, such as real estate, banking and finance, insurance, gaming, holding companies, etc. The import VAT must be paid and cannot be reimbursed later.
Option 2: Deducting the import VAT
This option is available for aircraft owned or operated by a company and utilized 100% by this company for business purposes in their pursuit of correct economic activities. As a rule of thumb, if a company generates a turnover at arm’s length prices and makes a profit in the long term, the VAT due on the aircraft may be deducted upon importation. Deducting is conditioned upon the company being subject to VAT, and the usage of the aircraft is linked to the company’s correct economic activities.
Aircraft must be used for the correct activities
Any importing entities using this option should initially check what kind of activities the aircraft will be used for in the future and if these activities are considered correct economic activities in the EU member state where the importation is planned. It is always a good idea to continuously ensure that the planned usage of the aircraft is also carried out as intended and that this usage is still considered correct economic activity. The definitions of the latter can change over the years, mainly due to recommendations from the European VAT Committee, which are based on judgments from the European Court of Justice. The VAT procedure is the same for any EU-established company in any EU member state. However, the process of implementing the EU’s VAT procedure into national legislation in each member state is subject to interpretation. Consequently, the paperwork and preconditions can differ from member state to member state.
Know what you are signing up for
Nobody should choose this option without knowing the full set of preconditions, risks, and ongoing demand for detailed documentation for the correct use of the aircraft. Most EU member states have a five-year period of limitation, but the relevant documentation must be filed for seven years and must be shown on demand during an audit. In most cases, written approvals by local customs authorities or legal opinions are available and recommended.
Only for business use – unless handled correctly
It is a common misunderstanding that it is acceptable to deduct all import VAT if the aircraft is used predominately for business purposes. The general rule is that the import VAT can only be 100% deducted if the aircraft is 100% used for acceptable correct economic activities. Any person using the aircraft for private, personal, or entertainment purposes must compensate the importing entity directly for its use. Otherwise, the importing entity will have to pay back the non-business part of the imposed import VAT to the VAT authorities.
Not compatible with imputed income and SIFL (US)
The use of imputed income to compensate for any private, personal, or entertainment use of a corporate aircraft is generally not accepted and will not eliminate and close an EU VAT claim. Also, please be aware that using the US’s Standard Industry Fare Level (SIFL) will not solve the compensation problem, as these values are often too low to be considered market rates.
All non-business uses worldwide matter
It is also important to stress that most EU VAT authorities will not differentiate between non-business use in and outside the EU. This means that any non-business legs flown, e.g., in the US by an American Part 91 corporate operator, will impact the EU VAT handling if the aircraft has been fully imported in the EU and the import VAT has been 100% deducted.
Option 3: Exempting the import VAT
This option is available for aircraft used 100% commercially by international charter operators, e.g., an AOC holder, Part 135 charter certificate holder, or similar. No VAT is imposed as the rate is 0%. The exemption is available both inside and outside the EU for qualifying operators with a qualifying aircraft. This procedure is often referred to as the “0% VAT airline exemption” and is based on a judgment from the European Court of Justice.
The aircraft registration
The registration can have any nationality, meaning all European registrations and the commonly used offshore registrations, such as P4, T7, M, and the VPs, are acceptable.
Aircraft base, free movement, and traffic rights (charter permits)
A fully imported aircraft can fly freely within the EU and is permitted to have a fixed EU base without restrictions. Non-EU-based charter operators will always have to apply for traffic rights on internal EU flights where required by aviation regulators, even though the aircraft is already correctly customs handled using the TA procedure or full importation. A full importation will not eliminate the need for proper traffic rights.
Where to fully import an aircraft
We advise that EU insiders should primarily pursue a full importation in their own EU member state, as an EU insider will always have to account for the VAT at its home base. EU outsiders are free to choose the EU member state where a full importation is seen as most beneficial for the chosen setup.
Important things to know about full importation
Operators should be aware that full importation includes a potential VAT and tax liability, requires continuous correct worldwide economic activity, and correct handling of any potential worldwide non-business use and/or non-commercial use, which are requirements that the TA procedure does not have. The statute of limitations is five years for full importation, and the use of the aircraft must stay fully compliant with current EU regulations worldwide until the end of this period.
We recommend that operators read the following links to learn about full importation.
| What are the 10 typical errors and misunderstandings? | Compilation of the most typical errors and misunderstandings when using full importation |
| The short story about full importation | Learn more about the essence of full importation |
Differences between Temporary Admission and full importation
Please have a look at the figures below. Start by locating the flight privileges needed. Then, learn about the risks and liabilities involved and decide how to fly within the EU using the most applicable customs procedure.
Most non-EU operators will practically have the same flying privileges using TA as given under full importation, as the few limitations do not influence the typical flight pattern – See Figure 3.
Full importation includes many potential risks and liabilities without providing any advantages for the typical non-EU operator. An aircraft using the TA procedure can be used for any purpose, such as private, leisure, entertainment, business or corporate use, and commercial group charters without any consequence for the customs handling – See figure 4.
Figure 3: What you can and cannot do
Simplified pros and cons list for non-EU operators.
| What you can and cannot do | Full importation | Temporary Admission |
| Flying to one EU destination | Yes | Yes |
| Flying internally within the EU | Yes | Yes |
| Maximum period of stay | Unlimited | Six months per stay 1) |
| Fixed or established EU base | Yes | No 2) |
| EU passengers on internal EU flights | Yes | Yes 3) |
| EU crew on internal EU flights | Yes | Yes 3) |
|
Green = Possible Yellow = Not possible 1) The aircraft can stay up to six months per stay, and multiple entries are allowed. |
||
Figure 4: Risks and liabilities
Simplified pros and cons list for non-EU corporate operators
| Risks and liabilities | Full importation | Temporary Admission |
| The biggest risks | Wrong and unaccepted use of the aircraft, e.g., non-business use of a corporate aircraft or non-commercial use of a commercial aircraft 1) | Ramp checks without the operator being ready and able to prove the TA compliance convincingly |
| Geographical areas that the aircraft must be used correctly according to EU regulation | Worldwide. After the importation, any future use of the aircraft, no matter where the aircraft is flying, must conform to the EU regulations | Only when flying within the EU |
| Statute of limitation | The VAT liability persists five years after the physical importation | Only when flying within the EU |
| Is non-business use allowed inside and outside the EU for corporate aircraft (Part 91)? | The answer is no unless all non-business flights worldwide are compensated correctly according to the EU regulation | Yes, all kinds of use are allowed. No compensation are required at all |
| Is non-commercial use allowed inside and outside the EU if the aircraft was imported using the EU 0% airline exemption (Part 135)? | Generally, no. However, it depends on the exact preconditions in the EU member state where the aircraft was imported. The required minimum commercial use is different between EU member states | Yes, all kinds of use are allowed. No compensation are required at all |
|
Green = High flexibility Red = Low flexibility and extra liabilities 1) Some business activities are not subject to VAT, such as selected real estate activities, banking and finance, insurance, gaming, and holding companies, etc. The listing is not complete. These activities will, therefore, not be seen as correct economic activities in this context. |
||
If you wish to know more about the differences between TA and full importation, we suggest that you have a look at these OPMAS articles.
| Short & Sweet mail no. 19 | The real differences between full importation and Temporary Admission |
| Quick Guide for Private and Corporate Operators | For Part 91 operators or similar – compare full importation and TA |
| Quick Guide for International Charter Operators | For AOC holders, Part 135 charter certificate holders, or similar – compare full importation and TA |
Summary
Many non-EU operators can benefit from the TA procedure, and we recommend using this procedure, if possible, when flying within the EU.
Please see the list of further benefits the TA procedure provides below.
– No cash payments of the VAT or customs duties are required
– No VAT liability anywhere in the EU
– No customs duty liability anywhere in the EU
– No VAT and importation registrations are required in Denmark or anywhere in the EU
– No bond or security for importation duties are required
– No ongoing economic activity or activity subject to VAT is required anywhere in the EU for the next many years
– No fiscal liability anywhere
– No tax and VAT consequences when visiting other EU member states; the aircraft can fly freely within the EU
– No need for a formal exportation of the aircraft when eventually sold or when the lease or operating agreement is terminated (EURO 5-7,000 saved potentially)
– No VAT consequences when a corporate aircraft is used for non-business activities by executives
– No change of the current aircraft registration or setup of other contractual agreements
– Less record-keeping compared to a full importation based on an EU VAT and importation registration
We will always be glad to assist, and you are always welcome to contact us to hear more about your options at no charge. We will happily send you our input on any questions the same day, often within 1-2 hours. If you have any questions or comments about the above, please do not hesitate to contact us directly at info@opmas.dk.
May you have many pleasant flights.
Best regards,
OPMAS
