The current economic climate is raising solvency concerns across a wide spectrum of industries and as a result some businesses will suffer. The likely knock on effect will be an increase in corporations facing potential insolvency action including repossession of valuable or financed assets; including business aircraft.
In such circumstances financiers and secured creditors will need to consider how to realise any value in repossessed aircraft, and these decisions will be dependent on various factors including:
- the current EU free circulation and VAT status of those aircraft,
- where the aircraft are physically sited at the time of repossession,
- any other potential complications arising from the history of the aircraft, and the defaulting owner, and
- likely difficulties in obtaining necessary supporting paperwork.
For receivers, insolvency practitioners and liquidators, there may also be additional requirements; where the appointed person is obliged to take over any responsibility for managing the affairs of the remaining business from the perspective of the local tax authority, as well as any negotiations that may be required with financiers and security holders to resolve outstanding debts.
The tax team at Martyn Fiddler Aviation is comprised of Chartered Tax Advisors with over 70 years of combined experience. We will be able to assist you from beginning to end in identifying and resolving any potential pitfalls from a Customs and tax perspective and our colleagues will be able to support you in arranging any aircraft movements to achieve your end goals.
To seek tax advice please contact Greta Kemper at greta@martynfiddler.aero
In the current climate it is likely that there will be some aircraft financiers who will either fail or will need to reduce their portfolios. The knock on effect will be the increased number of repossessions or other potential insolvency action.
