Isle of Man Ship Registry Launches Yacht Engaged in Trade (YET) Scheme

The Isle of Man will be joining just a handful of jurisdictions authorising the Scheme.

The Isle of Man Ship Registry has recently announced the launch of its Yacht Engaged in Trade (YET) Scheme for private yachts registered under the Isle of Man flag. The Isle of Man will be joining just a handful of jurisdictions authorising the Scheme, including the Cayman Islands and Marshall Islands.

As the global yachting industry continues to evolve, ultra-high-net-worth (UHNW) individuals and family offices are always seeking greater flexibility in how their luxury assets are managed and utilised. The YET Scheme is an innovative legal framework that facilitates this shift, enabling private yachts to operate commercially in a legally compliant and tax-efficient manner within specific jurisdictions.

What is the Yacht Engaged in Trade (YET) Scheme?

The YET Scheme is a regulatory framework which allows private yachts, flagged under certain registries, of at least twenty-four meters to engage in limited charter activities within designated European waters, notably France and Monaco, for up to 84 days annually. The Scheme presents yacht owners with the opportunity of flexible dual use, without permanently transitioning to commercial status. This allows owners to make use of their vessels for personal enjoyment whilst also gaining income and offsetting certain costs through charter, without compromising its private status.

Core Compliance Requirements

Owners and operators must satisfy several key criteria to qualify for the YET Scheme:

  • SizeThe yacht must be at least twenty-four meters in length.
  • RegistrationThe yacht must be registered as a private vessel under a flag that supports the YET Scheme, such as the Cayman Islands, Marshall Islands, and now the Isle of Man.
  • Compliance StandardsThe vessel must comply with all relevant commercial standards and regulations. This must be maintained continuously, including when the yacht is being used for personal use.
  • Customs and Tax StatusYachts should either have a VAT-paid status or operate under the Temporary Admission (TA) regime, allowing non-EU yachts to enter EU waters for up to 18 months without incurring VAT. Owners should seek professional tax guidance.

Key Advantages for Isle of Man Structures

  • Preservation of Private Yacht Benefits – For yachts owned through Isle of Man companies or trusts, the YET Scheme enables access to limited commercial income without altering the vessel’s core private status, preserving owner privacy, control, and operational flexibility.
  • Charter Income Potential Yachts enrolled in the YET Scheme can legally generate income via short-term charters in French or Monegasque waters, typically during peak season. This presents the opportunity to offset operational costs, crew salaries, insurance, and maintenance.
  • EU VAT Efficiency – When correctly structured, the YET Scheme supports zero-rated VAT treatment on charters originating in France or Monaco, under the EU’s Temporary Admission (TA) regime. This is particularly relevant for Isle of Man structures, as the island is outside the EU VAT area, making proper customs and fiscal representation essential.
  • Asset Value Protection Maintaining yachts private registrations, while allowing temporary commercial use, reduces physical wear, insurance implications, and regulatory burden of full commercial status, helping to preserve long-term asset value.

What This Means for the Isle of Man

The implementation of the YET Scheme framework further strengthens the Isle of Man’s reputation as a premier jurisdiction for private yacht ownership. Offering an efficient, compliant, and flexible route to chartering in EU waters, while upholding the highest international regulatory standards.

Final Thoughts

The YET Scheme offers a pragmatic solution for yacht owners who wish to unlock greater value from their assets without the burdens of full commercial operation. When implemented through a professionally managed Isle of Man structure, it can deliver a robust, tax-efficient, and compliant platform for mixed private and commercial use.

As global regulations continue to evolve, the importance of working with experienced advisers, across marine, legal, and fiduciary disciplines, cannot be overstated.

For more information on how the YET Scheme can be integrated into your yacht ownership and wealth management strategy, please contact Boston Multi Family Office at Enquiries@bostonmfo.com.

Disclaimer: This article is for informational purposes only and does not constitute legal, tax, or investment advice. Clients should seek tailored advice from qualified professionals before undertaking any yacht-related commercial activities.