A privately registered superyacht cannot simply take a paying charter guest aboard. Commercial charter activity generally requires commercial registration — a different regulatory category with its own safety code, crewing requirements, and compliance obligations that many private owners have no interest in taking on for the sake of a handful of charter weeks a year.
The YET scheme — Yachts Engaged in Trade — exists to bridge that gap. It lets a privately registered yacht charter for a limited number of days per year without converting the vessel's entire registration status. It is a narrow, specific tool, and it is frequently confused with — or assumed to include — VAT relief that it does not actually provide. This guide explains what YET does, what it does not do, and how it fits alongside the VAT mechanisms already covered in our Mediterranean Charter VAT Guide.
Sources: Ocean Independence industry guidance on Yachts Engaged in Trade; flag state (Marshall Islands, Cayman Islands) registration programme documentation, 2026. Confirm current requirements with the vessel's flag administration and a qualified maritime tax adviser before relying on this guide.
What YET Actually Is
YET is best understood as a registration and charter-days status, not a tax mechanism. It is administered principally through two flag state programmes — the Marshall Islands and Cayman Islands registries — and, on the European side, is currently recognised for charter activity in French, Monaco, and Croatian waters.
The scheme exists for a specific commercial reality: an owner with a privately registered yacht who wants to charter it occasionally — to offset running costs, test the charter market, or accommodate a broker's request for a handful of weeks — without converting the entire vessel to commercial registration, which brings a materially different set of safety, crewing, and insurance obligations that only make sense for a vessel running a genuine charter programme.
YET is not a substitute for commercial registration, and it is not designed to be. A yacht running a full charter season, or marketed primarily as a charter vessel, should be commercially registered outright. YET is a narrow allowance for privately registered yachts doing limited, occasional chartering.
Eligibility Requirements
The YET scheme applies to vessels meeting a defined set of conditions:
- Minimum size: generally 24 metres LOA and above
- Registration status: privately registered (non-commercial) under the flag state
- Safety standard: the vessel must meet Large Yacht Code (LYC) commercial safety standards, even though it remains privately registered — this is the mechanism that lets a private yacht carry paying charter guests safely and legally for the days it is trading
- Passenger limit: maximum of 12 passengers while operating under YET, consistent with the international limit that separates a yacht from a passenger-carrying vessel under SOLAS
- Charter days: up to 84 charter days per calendar year
A vessel that does not already meet LYC safety standards will need to bring the yacht up to that standard before YET registration is possible — this is often the largest practical hurdle for an owner considering the scheme, more so than the administrative process itself.
What YET Does Not Do: VAT
This is the point of greatest confusion, and the reason this guide exists alongside — not instead of — our Mediterranean Charter VAT Guide.
YET provides no VAT exemption or reduction. A yacht chartering under YET status still owes VAT on the charter fee at the full standard rate applicable in the country where the charter commences. In France, that is the standard 20% rate. The scheme changes whether a privately registered yacht is permitted to charter at all — it does not touch the tax treatment of the charter fee once that charter happens.
VAT relief in French waters is a separate matter entirely, available only to fully commercially registered vessels through the mechanisms described in our VAT guide: the French Commercial Exemption (FCE), which requires 15-metre-plus vessels in fully commercial charter operation with at least 70% of the previous tax year's trips outside French territorial waters, and the broader EU use-and-enjoyment rule, which applies VAT only to the proportion of charter time spent in EU waters.
A yacht chartering under YET and a yacht chartering under full commercial registration with FCE relief are in fundamentally different tax positions, even if both are operating in French waters in the same week. Confusing the two — assuming YET carries the VAT treatment that only applies to fully commercial vessels — is a compliance and budgeting error that surfaces at exactly the wrong moment: when the charter fee invoice is issued.
Managing VAT Status Alongside YET
Because YET itself does not resolve VAT, a yacht operating under the scheme needs its VAT position handled through one of two paths: holding a VAT-paid certificate for the vessel, or entering EU waters under Temporary Admission — which is itself limited to non-commercial use and creates a genuine tension with the act of chartering. Flag administrations manage this through the certificate structure issued for each YET charter period, but it means the VAT question needs to be resolved with a tax adviser before charter dates are confirmed, not after.
The Application Process
Bringing a yacht onto YET status for a specific charter period follows a defined sequence:
- Declaration of Private Use with Intent. The owner files this declaration with the flag state administration, setting out the intended charter activity.
- Flag compliance verification. The flag administration confirms the vessel meets LYC safety standards and the other eligibility conditions.
- Customs broker engagement. A customs broker manages the practical registration process — commonly cited industry cost is in the region of €7,000, with a process taking roughly two weeks.
- Temporary Certificate of Registry. The flag state issues a Temporary Certificate of Registry covering the specific charter dates the vessel will trade under YET.
The Owner Cannot Use the Yacht During Trading Dates
A detail that catches owners by surprise: during the period covered by the Temporary Certificate of Registry, the beneficial owner cannot use the vessel for private purposes. The certificate is issued for the specific charter dates — the yacht is operating commercially for those dates, full stop, and private use resumes only once the temporary certificate period ends.
Where YET Fits Alongside French Charter VAT
To place YET correctly next to the VAT mechanisms already covered in our Mediterranean Charter VAT Guide:
| Mechanism | What it governs | Applies to | |---|---|---| | YET | Whether limited commercial chartering is permitted at all | Privately registered yachts, 24m+, up to 84 charter days/year | | French Commercial Exemption (FCE) | VAT reduction based on non-French-waters trip proportion | Fully commercially registered yachts, 15m+ | | EU use-and-enjoyment rule | VAT applies only to proportion of time in EU waters | Fully commercially registered yachts across France, Italy, Malta, Monaco |
These sit at different layers of the same operation. A privately registered yacht doing a handful of charter weeks a year needs YET to charter legally at all, and pays full VAT on those charters. A fully commercially registered yacht running a genuine charter season needs FCE or the use-and-enjoyment rule to manage its VAT exposure, and does not need YET because it is already commercially registered.
For an owner weighing whether to convert to full commercial registration versus staying private and using YET for occasional charters, the honest comparison is not "which saves more on VAT" — YET does not touch VAT at all. It is "does the charter volume justify the safety, crewing, and compliance obligations of full commercial registration, or does a limited, well-defined 84-day allowance under YET meet the actual goal?"
A Note on France's 2020 VAT Change
Operators researching French charter VAT will frequently encounter references to a 2020 change that abolished a flat-rate reduction. That change — the French tax authority's replacement of a flat 50% taxable-revenue reduction with the proportional use-and-enjoyment method, effective from November 2020 — belongs to the VAT side of French charter operations, not to YET. It affected fully commercially registered vessels claiming VAT relief on the proportion of a charter spent outside EU waters. It has no direct bearing on YET eligibility or the YET application process, though it is useful context for understanding why French charter VAT today works the way our VAT guide describes.
Frequently Asked Questions
Getting the Registration Question Right Before the Season
YET is a genuinely useful tool for the specific situation it was built for — a privately registered yacht doing limited, occasional chartering without the commitment of full commercial conversion. It is a poor fit, and an expensive one, for an owner who actually needs full VAT relief on a real charter programme, and confusing the two leads to budgeting and compliance mistakes that surface exactly when a charter fee invoice is due.
Before committing to either path, confirm the vessel's eligibility with the flag administration, the VAT position with a qualified maritime tax adviser, and — if commercial registration is the better fit — the full compliance requirements that come with it.
HelmOps helps captains and managers keep registration certificates, compliance documents, and charter schedules organised and accessible offline at every port, so the paperwork behind a YET charter period or a full commercial conversion is never the bottleneck.
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Sources: Ocean Independence, "Yachts Engaged in Trade Scheme" industry guidance; French tax authority bulletins BOI-TVA-CHAMP-30-30-10 and BOI-TVA-CHAMP-20-50-30 on charter VAT treatment; flag state registration programme documentation (Marshall Islands, Cayman Islands), 2026. Regulatory and flag state requirements are subject to change and vary by vessel — consult the vessel's flag administration and a qualified maritime tax adviser for current requirements applicable to your yacht.
