Yacht Charter VAT and Tax by Country (2026–2027)
Quick answer
Yacht charter VAT is charged on the base charter fee and is set by the country where the charter starts, not the yacht's flag. In 2026 it ranges from 0% in Montenegro, the BVI and USVI to 13% in Croatia, 20% in France and Monaco, 21% in Spain and 22% in Italy, with Greece usually around 12–13% for qualifying crewed charters and the Bahamas at 14%. On a €100,000 week that is the difference between paying nothing and paying €22,000.
What is yacht charter VAT and who pays it?
Yacht charter VAT is a tax added to the base charter fee, and the charterer pays it. It is quoted on top of the weekly rate, paid with the balance about five weeks before embarkation under standard MYBA terms, and it can add more than a fifth to the headline price.
Advertised rates exclude VAT, the APA and crew gratuity, which makes VAT one of the largest and most overlooked lines on a Mediterranean invoice. Our full yacht charter cost guide shows how it fits into the total, but the starting point is simple: know the rate in the country where you board.
Yacht charter VAT by country: the 2026–2027 table
VAT rates on crewed charters run from 0% to 22% across the main charter regions. The table below sets out the rate, what it is charged on, and the conditions that change it.
| Country / region | Charter VAT or tax | Charged on | Key notes |
|---|---|---|---|
| Greece | 24% standard; usually about 12–13% effective for qualifying crewed charters | Base fee | Reduced rate depends on licence, duration (typically 48h+) and itinerary; some sources quote 5.2–13%. Confirm the contract rate. TEPAI cruising fee is separate. |
| Croatia | 13% | Base fee | Applies to charters starting in Croatia. Charters starting outside the EU pay pro rata for days in Croatian waters. Non-EU-flagged yachts need a cabotage licence. |
| Italy | 22% | Base fee | Flat-rate reductions (e.g. 6.6% for yachts over 24m) abolished April 2020. Proven non-EU time may reduce it; budget 22%. |
| France and Monaco | 20% | Base fee, plus delivery and redelivery fees | Can be reduced in proportion to documented time outside EU waters. |
| Spain, incl. Balearics | 21% | Base fee | No reduction for international waters. Canary Islands use IGIC instead, about 7%. |
| Montenegro | 0% | — | VAT-free fuel too. Croatian 13% applies pro rata for days in Croatia. A small cruising vignette is typically paid from the APA. |
| Turkey | 20% on Turkish-flagged vessels; reported 0% on foreign-flagged commercial yachts | Base fee | Cabotage and permit limits apply when guests embark in Turkey on foreign-flagged yachts. |
| Malta | 18% standard, applied to the share deemed in EU waters | Base fee | Yachts over 24m taxed on 30% of the fee (about 5.4% effective); smaller yachts about 7.2–9%. Based on 2013 guidelines; confirm current status. |
| Bahamas | 14% combined | Base fee | 10% VAT plus 4% Port Department charter tax, merged into one Port Department levy from July 2025. Proposed cuts not enacted. |
| BVI | No VAT | — | Cruising permit: $4 per person per day on BVI-based yachts, $16 on foreign-based yachts. |
| USVI | No VAT, no charter tax | — | Applies to charters starting in the USVI. |
Rules change and brokers interpret them differently, so treat these as planning figures and confirm the exact rate and basis at booking.
Does VAT follow the yacht's flag or where the charter starts?
VAT follows where the charter starts. If you embark in Split, you pay Croatian VAT; if you embark in Palma, you pay Spanish VAT, whatever flag is painted on the transom.
This is why itineraries that cross borders need care. A week that starts in Dubrovnik and spends two days in Montenegro still carries Croatian VAT, while a week that starts in Tivat pays Montenegro's 0% and only owes Croatian 13% pro rata on the days spent in Croatian waters. Flag does matter for permission to operate: non-EU-flagged yachts need a cabotage licence in Croatia, and foreign-flagged yachts face cabotage limits when guests embark in Turkey, as set out in Turkish cabotage rules.
How does Greek charter VAT work, and what is TEPAI?
Greece has a 24% standard rate but a reduced effective rate for most crewed charters, and it adds a separate monthly cruising fee called TEPAI. Budget about 12–13% VAT for a typical crewed week longer than 48 hours, and up to 24% if the charter does not qualify.
Sources genuinely conflict on the single current effective figure. One large brokerage gave a 5.2–13% range in May 2026, and many others quote 12%. Our view: use 12–13% for budgeting and ask your broker which rate the contract will show. Read our Greece yacht charter guide for how this compares with the rest of the trip.
TEPAI is charged per month on vessels over 7m and is due before entering Greek waters or before each month begins, with a one-month minimum. According to the AADE TEPAI brochure, the bands are:
- 7–8m: €16 per month
- 8–10m: €25 per month
- 10–12m: €33 per month
- Over 12m: €8 per metre of length per month
Professional vessels over 12m get 20% off, exclusive professional use takes a further 25% off (the two compound), and annual prepayment earns 10% off. For a 30m charter yacht in exclusive professional use, that works out to roughly €240, then €192, then €144 per month. Whether it is absorbed by the owner or passed through depends on the contract.
Croatia: why 13% makes it a value play
Croatia charges a flat 13% on charters starting there, one of the lowest rates in the EU charter market, which helps explain the strength of the Croatia yacht charter market. The edge cases are charters starting outside the EU, which pay pro rata for days in Croatian waters, and non-EU-flagged yachts, which need a cabotage licence.
Italy, France, Monaco and Spain: the high-rate Western Med
The Western Med carries the highest charter VAT: 22% in Italy, 21% in Spain and 20% in France and Monaco.
- Italy (22%): the old flat-rate reductions, including 6.6% for yachts over 24m, ended in April 2020. Brokers say documented time outside EU waters can reduce the bill, but no fixed effective rate is confirmed. Budget the full 22%.
- France and Monaco (20%): VAT can be reduced in proportion to documented time outside EU waters, and delivery and redelivery fees are also taxable.
- Spain and the Balearics (21%): no reduction for time in international waters. The Canary Islands use IGIC at about 7% instead.
Turkey and Malta: lower rates with conditions
Turkey and Malta can both come in well below the Western Med, but each has conditions. Turkey's general rate is 20% on Turkish-flagged vessels, while foreign-flagged commercial yachts are reported at 0%; cabotage rules limit how foreign-flagged yachts can embark guests in Turkey, so confirm the setup before booking a Turkey gulet charter or motor yacht.
Malta's 18% standard rate is applied only to the share of the charter deemed to be in EU waters. Yachts over 24m are taxed on 30% of the fee, about 5.4% effective, and smaller yachts pay about 7.2–9%. These rules derive from 2013 guidelines and we found no 2026 confirmation, so use 5.4–18% as your planning range.
Caribbean charter tax: Bahamas, BVI and USVI
The Bahamas charges a 14% combined levy, while the BVI and USVI charge no VAT. That gap is a real factor in Bahamas vs BVI decisions.
The Bahamas' 14% is 10% VAT plus a 4% Port Department charter tax, merged into one levy from July 2025; pledges to cut it have not been enacted. The BVI charges a cruising permit instead of VAT: $4 per person per day on BVI-based charter yachts and $16 on foreign-based ones. For 10 guests over 7 days, that is roughly $280 versus $1,120. A new licensing structure for foreign-based term charters was proposed in 2025, but its final status is unconfirmed. Charters starting in the USVI pay no VAT and no charter tax.
Worked example: the same €100,000 week in seven places
The same base fee produces very different totals once VAT is added. This table uses a €100,000 base week (roughly US$115,000) and a 30% APA, which is typical for many yachts.
| Embarkation | VAT rate used | VAT | APA (30%) | Base + VAT + APA |
|---|---|---|---|---|
| Montenegro (Tivat) | 0% | €0 | €30,000 | €130,000 |
| Malta (yacht over 24m) | ~5.4% | €5,400 | €30,000 | €135,400 |
| Greece (qualifying) | ~12% | €12,000 | €30,000 | €142,000 |
| Croatia | 13% | €13,000 | €30,000 | €143,000 |
| France / Monaco | 20% | €20,000 | €30,000 | €150,000 |
| Spain / Balearics | 21% | €21,000 | €30,000 | €151,000 |
| Italy | 22% | €22,000 | €30,000 | €152,000 |
Crew gratuity of 10–15% in the Med comes on top; see our tipping guide. Figures are illustrative: real APA, delivery fees and effective rates vary by yacht and contract.
Is VAT charged on the APA and the tip?
No. Charter VAT applies to the base fee only; APA purchases already carry local taxes, and the tip is a voluntary gratuity outside the contract.
How can you legitimately reduce yacht charter VAT?
The only reliable lever is where the charter starts. Starting in Montenegro rather than Croatia, or Greece rather than Italy, changes the rate by law; reductions based on non-EU time in France or Italy depend on documented logs and should be agreed in writing before you sign. Rules change; confirm the current rate and basis at booking.
Frequently asked questions
Is VAT charged on a yacht charter?
Yes, in most of the Mediterranean VAT is added to the base charter fee, at rates from about 12% in Greece to 22% in Italy. Montenegro, the BVI and the USVI charge no charter VAT, while the Bahamas charges a 14% combined levy. Your broker adds the correct rate to the contract once the embarkation port is fixed.
Does yacht charter VAT depend on the yacht's flag?
Generally no. The rule of thumb is that VAT follows the country where the charter starts, so a Cayman-flagged yacht starting in Palma pays Spanish VAT. Flag still matters for permits and cabotage, especially in Croatia and Turkey.
Is VAT charged on the APA?
VAT is applied to the base charter fee, not to the APA itself. The fuel, food and berths paid from the APA already carry whatever local taxes apply at the point of purchase, so you do not pay charter VAT a second time on them.
What is the VAT on a yacht charter in Greece?
The standard Greek rate is 24%, but crewed charters that meet the licence, duration and itinerary conditions usually pay a reduced effective rate, commonly quoted around 12–13%. Sources conflict on the exact figure, so confirm the rate your contract will carry before signing.
Which countries have no VAT on yacht charters?
Montenegro charges 0% charter VAT and sells VAT-free fuel, and the BVI and USVI have no VAT on charters starting there. The BVI does charge a per-person daily cruising permit. Turkey is reported at 0% for foreign-flagged commercial yachts, though cabotage limits apply.
Can you reduce VAT by sailing outside EU waters?
In France and Monaco, VAT can be reduced in proportion to documented time outside EU waters, and Italy may allow a reduction with proven non-EU time. Spain allows no such reduction. Plan any reduction with your broker before booking, because it depends on logs, not intentions.
Charter rates, APA, VAT and fees quoted are approximate, vary by yacht and season, and change often. Confirm current figures with your broker at booking.