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Short & Sweet no. 1
Flying with the CEO

Added November 2020
  • What are the consequences and the pitfalls?

  • How to get the greatest flexibility?

The Flying with the CEO within the EU case describes a scenario where the aircraft is imported/admitted by a non-EU corporation that operates and uses the aircraft mainly for their own business, flying with the CEO and/or the management. But please remember that many other scenarios are in play that influence the situation.

The customs aspect of flying within the EU
Any aircraft flying into the EU will operate under customs control using either the Temporary Admission procedure (TA) or full importation (FI). There are no other options. 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 with only one option: full importation. EU outsiders can, of course, choose to use full importation instead of TA if they find it beneficial. However, both options can be used commercially or privately if applied correctly.

It is often tricky for laypeople to see the differences between the two entry options, but the flexibility and long-term consequences are very different, and there are certain conditions, which must be taken into consideration when opting for TA or FI. Non-compliance with either the TA or FI regulations will most likely activate a direct payment of the VAT (ranging 17-27%) and customs duty (2.7-7.7%). Please see the below-mentioned topics and comments for TA and FI.

What about business/corporate use in general?
FI: Business use, in general, is not a problem if the usage is directly in pursue of approved economic activity of the importer.
TA: The aircraft can be used for any purpose as long as tickets are not sold.

What if the aircraft is used for e.g., commuting by the CEO?
FI: Any flight where the purpose is commuting, entertainment, hobby and personal recreational travel, or any travel in furtherance of another business than the importing entity’s affairs, cannot be considered business/corporate use. The mentioned usage can cause payment of the VAT imposed during the importation, but any non-business use can be justified if the CEO pays the correct compensation for these flights.
TA: The aircraft can be used for any purpose as long as tickets are not sold.

How can the CEO pay compensation if the aircraft is not used for business/corporate use?
FI: The CEO must pay the importer directly for the flights at a market rate. The use of imputed income will not work as the payment is not effectively made to the importer.
TA: Use of imputed income, timeshare, or any other form of payment is accepted as long as it is not a payment for a ticket.

Is the EU importation/admission affected when the aircraft flies outside the EU?
FI: Yes, this means that a non-business/corporate leg flown, e.g., in the US/Asia, will have a negative impact on an EU VAT assessment during an audit by the EU VAT authorities which will in many cases trigger a payment to the authorities, as the importation VAT will partly be seen as wrongly declared as business/corporate use.
TA: No – only flights within the EU matters.

List of all OPMAS
Short & Sweet mails:

No. 20 – Buying or selling aircraft within, to, or from the EU
Nov 2023 TA FI


No. 19 – The real differences between full importation and Temporary Admission
Sep 2023 TA FI


No. 18 – Exporting an aircraft from the EU
Jun 2023 FI


No. 17 – What is the correct use of a corporate aircraft?
Mar 2023 FI


No. 16 – Which customs procedures can be used for parking an aircraft within the EU?
Jan 2023 TA FI


No. 15 – Liability and risk elements associated with EU importation and admission
Oct 2022 TA FI


No. 14 – Part 3: Arriving in the EU using the TA procedure (does an operator need help?)
Aug 2022 TA


No. 13 – Importation impacts when traveling the world in corporate aircraft
Jun 2022 FI


No. 12 – How to get the 0% airline VAT exemption meant for commercial operators
May 2022 FI


No. 11 – Part 2: Arriving in the EU using the TA procedure (be ready for customs’ ramp checks)
Mar 2022 TA


No. 10 – How to handle aircraft maintenance correct in a customs context​
Feb 2022 TA FI


No. 9 – Part 1: Arriving in the EU using the TA procedure (about the Supporting Document)
Dec 2021 TA


No. 8 – Do not fall into the operator trap when flying within the EU and UK
Oct 2021 TA FI


No. 7 – Which offshore aircraft registrations can be used with Temporary Admissions when flying within the EU and UK?
Sep 2021 TA


No. 6 – Flying with EU-resident persons onboard when using Temporary Admission
Aug 2021 TA


No. 5 – What about private use
of corporate aircraft?

May 2021 TA FI


No. 4 – What does ‘VAT paid’ mean?
Mar 2021 FI


No. 3 – Is a full importation needed
in both the UK and the EU27?

Mar 2021 FI


No. 2 – Flying commercially
within the EU

Feb 2021 TA FI


No. 1 – Flying with the
CEO

Nov 2020 TA FI

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