AIRCRAFT LOAN: REQUIREMENTS AND TAX LIABILITY

2007-03-08 10:33:40

( Business )



Aircraft loans can either be applied online or over the phone. Aircraft lenders finance variety of aircrafts. However, experimental jet aircrafts are hard to finance though there are still some lenders who are willing to finance such aircrafts.

Requirements for Application

Just like any other type of regular loans, lenders for aircraft loan require a good credit history. Check your credit reports to ensure that your credit records are accurate and correct erroneous entries quickly. Two years of tax return is required for employed person while an equivalent of two years tax return is required for self employed individuals. Finally, an aircraft specification sheet is required to be submitted to the lender for evaluation of your aircraft loan. The aircraft specification sheet determines the amount that you need to purchase the aircraft you want.

Requirement for Approval

Approval of aircraft loan usually requires title search, copies of log book, photos of the aircraft, pre-purchase inspection of the aircraft and insurance coverage for the aircraft. You can check with the lender if you can arrange a scheme with them for dual liability for payment of insurance premium on the aircraft. However, it will increase your loan repayments. Pre-purchase inspection is necessary to ensure that the aircraft that you are buying is in condition and comply with the aircraft specification sheet that you have provided during application.

Tax Liability

It is advised that borrowers, particularly those new to aircraft ownership, check the tax requirement for owning an aircraft. Check what and how much taxes are applicable for the purchase and sale of aircraft. It is important to do this since purchase of an aircraft is a major and huge investment that will have a major impact on your tax obligations. You can ask about its tax implications from your lender or better yet ask a tax expert to guide you on the tax implications of purchasing an aircraft.


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