2025 June

Insurance brokers are routinely asked the question, “Am I covered?” 

This question is particularly relevant when you’re operating an aircraft you do not own but are approved by the aircraft owner’s insurer to fly/operate. 

A non-owned aircraft is defined quite simply as an aircraft (fixed wing or rotorcraft) that you have no ownership interest in—either in whole or in part. 

So, an aircraft you may borrow from a friend or even fly as part of your training with a flight school would qualify as a non-owned aircraft. 

There are currently many products available in the market for non-owned/renter’s insurance—some of the more noteworthy are underwritten by Starr, Global Aerospace, AVEMCO, Stargate and Skywatch. 

Direct writers of the non-owned product are AVEMCO, Skywatch, and Stargate—which means no broker is needed; you are actually buying the product directly from the insurer.

Generally speaking, non-owned coverage is readily available for fixed and rotor wing piston SEL and MEL aircraft (and seaplanes) by all the aforementioned underwriting carriers. 

Some insurers may have limitations on certain aircraft classes (i.e., seaplanes and/or rotorcraft), as not all non-owned insurers will cover all types of non-owned exposures. 

Non-owned insurance for turbine and/or pressurized aircraft is very challenging to come by—hardly any carriers in the space will write policies for non-owned aircraft that are turbine/pressurized. There are some exceptions, however.

Non-owned insurance is typically the least expensive aviation insurance product sold and is intended to ‘cover’ the non-aircraft owner for losses which might be due to their negligence or even losses which occur due to no fault of the renter or pilot of the non-owned aircraft. 

Policies can be purchased with hull and liability coverage, or just liability only—you cannot purchase non-owned hull insurance by itself. The hull coverage and liability coverage limits available differ by insurer and the products in the marketplace. 

However, pricing between insurers is typically very similar. Non-owned hull can be placed up to $750K, and non-owned liability at limits around $1M (again depending on your specific insurer’s product offerings). 

It’s encouraged that if you’re flying a rental aircraft via a flight school, for instance, that you carefully review the school’s formal rental agreement. 

Rental agreements will usually specify what limit of non-owned coverage the school requires to be carried. 

Most flight schools either mandate or strongly recommend the renter has non-owned aircraft insurance. At a minimum, it should cover the flight school’s aircraft physical damage deductible. 

The non-owned insurance that you purchase will also allow coverages for physical damage of the rental/non-owned aircraft up to the hull insurance limits you purchase. 

The liability limit you purchase will protect you (the policyholder) with respect to liability claims up to the occurrence and passenger liability limits on your policy. 

The flight school and/or aircraft owner’s policy will cover the school/aircraft owner at the policy limits on the primary policy in place. 

You can think of non-owned insurance as secondary insurance to the flight school’s own insurance policy but solely in favor of the renter and/or pilot flying a non-owned aircraft.

End state is that non-owned insurance is an insurance product you do not want to go without when you are operating an aircraft that you do not own. 

Otherwise, you may be liable for damages to the aircraft and/or liabilities related to property damage or bodily injury to third parties. 

Always discuss your flying-related exposures with an insurance professional to gain insight on what insurance products you need to have in place to adequately cover your liabilities should there be a loss.

The first part of this series about importing aircraft addressed customs and tariffs, which seem to be ever-changing. But how does an aircraft buyer deal with that ever-present certainty: taxes?

Buying an Aircraft? Here Are the Taxes You Need to Know

Depending on the country, taxes on aircraft transactions can come as either sales tax (including “Goods and Services tax” – GST), or its sibling: value-added tax (VAT).

Sales tax and GST are similar, but depending on the country, they can apply to goods or both goods and services. The aircraft seller is often required to collect and remit the sales tax upon the sale.

In the U.S., state sales taxes range from 0% to 7.25%, with some local taxes added on top. Singapore, known for low taxes, charges a 9% GST. Canada charges a 5% federal GST, plus additional provincial taxes, or a “Harmonized Sales Tax,” totaling between 5% and 15%, depending on the province.

VAT is similar but has a different application mechanism. It applies at every level of production, rather than just the final sale to the end-user. VAT is collected at each level of sale, with the seller receiving a discount for the upstream VAT that they paid on their own purchase.

VAT is common in Europe and the UK, with rates typically around 20%. Switzerland is an outlier, currently at 8.1%, and the Scandinavian countries are on the high side at 25%.

How to Minimize Sales Tax and VAT?

Taxes on a multimillion-dollar aircraft transaction add up quickly and could make a foreign transaction economically unfeasible.

Buyers and sellers have two main tools to minimize these taxes.

Since sales taxes typically only apply when the sale occurs within the taxing jurisdiction, the first solution is easy—move the plane prior to closing.

Aircraft are uniquely mobile assets, making it fairly easy to reposition them to a tax-friendly jurisdiction for closing. Tax-friendly can mean a low tax rate, or a jurisdiction with an exemption to the sale. At the risk of sounding nationalistic, moving the aircraft to the U.S. before closing can be the simplest option.

If the plane has to come to the U.S. for an American buyer anyway, it might as well be flown to a tax-friendly state for closing. Some states have no sales tax, some have the sales taxes capped (South Carolina and North Carolina come to mind, at $500 and $2,500 max sales taxes, respectively), and some have other exemptions.

If the foreign seller is reluctant to move the aircraft to the U.S. before closing, options exist to complete the transaction overseas without sales tax implications.

The most common overseas exemption on sales taxes is on goods for export, which often includes aircraft. Local tax counsel is important to ensure the exemption. For instance, the EU is generally supposed to have an export exemption from VAT. However, the application of the exemption is applied on a country-by-country basis with unique quirks.

Singapore also has an export exemption, which, when combined with excellent maintenance facilities, makes it a great place to complete a pre-purchase inspection and complete closing on an Asian-origin aircraft.

Other countries have unique exemptions. For instance, the UK has a “customs warehouse” option where a plane based outside the UK can transact in the UK for export without incurring the UK’s VAT. This requires the assistance of partners in the UK or the Isle of Man to opine on the transaction structure and obtain the required paperwork, before the plan arrives in the jurisdiction

In Closing

While death and taxes may be inevitable, good planning can eliminate or at least reduce the sales taxes due at the time of an aircraft.

Stay tuned for upcoming articles that break down the challenges of buying a foreign aircraft—and how to navigate them with confidence.

Part 5: Logistics: Where to Inspect the Plane and Complete Closing?

Part 6: Contractual Quirks of Foreign Transactions

This article is not intended, nor should it be construed or relied upon, as legal advice. The comments, recommendations, and analysis expressed in this article are those of the individual author, John Farrish, are purely informational. This article does not create an attorney-client relationship between you and the author or his law firm. If specific legal information is needed, each person should retain and consult an attorney with knowledge of the subject matter.

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At the Spring IADA meeting in Scottsdale, I had the opportunity to participate on a panel focused on one of our industry’s most pressing issues: workforce development.

Moderated by Phil Stearns of Stevens Aviation, the panel featured insightful contributions from Jo Damato of NBAA and Dr. Shanan Gibson of Embry-Riddle. Together, we shared perspectives on elevating the people who keep our operations flying.

The conversation resonated deeply. Not just because it’s a trending topic—but because it’s tied to something every leader wants more of.

The Four-Letter Word? It’s TIME.

Yes. TIME is the word we’re all chasing.

In the world of business aviation, we frequently assert that "business aviation buys you time."

After all, a private aircraft enhances organizational agility, fosters customer intimacy, accelerates transactions and significantly boosts productivity.

And the data backs that up.

According to a comprehensive study by Andersen, companies that operated business aircraft achieved a 343% return to shareholders between 1995 and 1999.

Those that didn’t? Just 177%.

This competitive advantage stems directly from increased mobility, efficiency and yes, more time.

But here’s the connection: just as investing in aircraft helps executives maximize time, so does investing in people.

Invest in People, Buy More Time

Well-trained, well-supported employees function much like a high-performance fleet. They boost organizational efficiency, reduce executive bandwidth strain and help businesses capitalize on opportunities faster.

Employee development mirrors the value of aviation. It saves time, leverages top talent and improves flexibility and responsiveness.

Teams that are trained and empowered can take on more complex projects with clarity and confidence. That agility? It ties directly to greater profitability and market share growth—key drivers of shareholder value, per the Andersen study.

Reduce Turnover. Increase Impact.

Workforce development also reduces costly turnover, much like how a corporate aircraft reduces travel-related fatigue and stress.

A jet gives decision-makers a focused environment mid-flight. A strong workforce culture gives your team a focused environment every day.

By investing in employees, you create a workplace where innovation flows, knowledge is shared and execution improves.

Strategically nurturing your workforce also restores something that’s often overlooked in aviation: work-life balance.

A Workforce Culture That Honors TIME

The Andersen study noted that business aircraft “lengthen the workday without forcing employees to lose time with their families.”

Workforce development can do the same.

When employees are well-trained and supported, they execute tasks with greater efficiency. Thereby reducing overtime and preserving personal time.

They don’t need constant oversight. They don’t burn out. And they protect not only your time, but their own.

That’s the real value: a workforce culture that respects the four-letter word that matters most.

The ROI of TIME

As business aviation leaders, we understand the return on investing in high-quality aircraft.

But what about investing in the people who manage, support and lead those operations?

By giving your team the tools to grow, you gain something that no amount of capital can create.

Time to lead.

Time to innovate.

Time to thrive.

That’s the kind of four-letter word every business could use more of.

Your team, your family, and your bottom line will thank you for it.

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Fresh off a successful and well-attended NBAA Regional Forum at White Plains, I’ve been reflecting on our industry—and the economy.

With shifting tariff policies and global uncertainty, aircraft buyers still face a simple choice: Either “go” or “stop.”

• “Go” means proceeding with the purchase and adjusting to economic conditions as they arise.
  
  
• “Stop” means pausing until there’s more certainty.

While walking around the Forum, I asked several peers where they saw the market heading. Not surprisingly, opinions fell into both camps. And both perspectives are valid.

Prepared Leanders are Ready to Finance, Regardless of Timing

At Scope, we’re here to support buyers who are ready to move forward, regardless of market volatility.  And we’re able to do so by being pragmatic in how we look at underwriting and loan funding.

We take time to understand our clients’ businesses and structure deals that meet their needs, even during uncertainty.

A bank can be pragmatic and steady-handed in how it funds aircraft loans. Especially when it has a strong understanding of the bigger picture and maintains a longer-term view. Most of the fully-dedicated aircraft financing organizations in our industry that have been around for a while share this approach.

In our case, we’ve been around for 50 years and have consistently provided financing solutions through both strong markets and more challenging times.

So, when you’re ready to “go” and financing is a part of the plan, be sure to work with an experienced, aircraft-knowledgeable lender. They’ll help you navigate the process and reach your goals, despite economic twists and turns.

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As a CPA, I often talk to aircraft owners who’ve relied on advice from friends or non-aviation advisors—only to have been hit with big tax surprises later.

That’s why, if you’re considering purchasing a jet, upfront tax planning is essential. The rules can be tricky, and there are many important considerations.

Understanding the Tax Landscape
Most prospective aircraft owners using their aircraft for business purposes focus on federal tax benefits. These include deductions like accelerated and bonus depreciation for bona fide business use.

However, improper ownership structure, cash flow planning, or tax reporting can eliminate those deductions. That’s why it’s critical to address these issues before buying.

Don’t Forget to Consider State and Local Taxes

What many aircraft owners overlook are tax implications at the state and local level.

While some state taxes are unavoidable, early planning can often reduce large upfront payments. If ignored, the result may be significant penalties and interest on top of the tax owed.

As I’ve shared in a previous article, both the IRS and states are getting savvier about aircraft ownership—and they’re actively watching for non-compliance.

With the right plan in place—and proper execution—you can avoid unexpected tax bills and penalties. Involve an aviation tax advisor from the start.

And make sure your broader tax team is part of the conversation to achieve the best results.

We all know someone who seems to learn everything the hard way. Maybe that person is you.

The most powerful people in the world aren’t the ones with titles or followers. They’re the ones who’ve made peace with discomfort. 

Those who don’t mourn the past but study it. Who let pain shape them, not define them.

“Never again will I pity or belittle myself.”

Og Mandino, The Ten Vows of Success

Our culture teaches us to build an identity, an image. And when we fall short of that image, we feel shame. 

But maybe the image was never real to begin with. Maybe it was just ego talking.

Here’s what no one tells you: sadness and struggle aren’t signs that something is wrong with you. 

They’re invitations to look deeper. To find the real source of the disappointment. Not the surface-level event, but the belief underneath it.

If you want peace, stop arguing with reality. Accept the moment, even if it’s hard. Work with it, not against it.

Emotions aren’t enemies. They’re signals. But when we let them run the show, we lose ourselves.

You are not your sadness. You are not your anxiety.

You are the awareness beneath them.

The Latin root of the word “emotion” literally means “to disturb.” That’s what these feelings do. They disrupt—but they also reveal. If you pay attention, they’ll show you the work you need to do.

The goal isn’t to never feel pain. It’s to stop identifying with it.

“But here’s the truth: failure is not the opposite of success—it’s the highway to it.

– Lord Greville

Books to Help

The Power of Now – Eckhart Tolle

A deep exploration of how living in the present moment frees us from the grip of fear, pain, and ego. Tolle reminds us that the mind loves to live in the past and future, but peace is only ever found now.

Radical Acceptance – Tara Brach

This book teaches you how to stop judging yourself and start making room for the full truth of who you are. By embracing yourself as you are—not as who you think you should be—you can begin the journey toward healing and growth.

In Conclusion

Your self-worth is not a project to be completed. It’s already here. 

The more you honor the present moment, the more you detach from the egoic stories about who you’re “supposed” to be.

You didn’t fail. You learned. You tried with what you had. And now you know more.

Whatever comes next, greet it like you chose it.

You’re not broken. You’re becoming.