Wet Lease vs. Dry Lease for Private Jets: Key Differences

Two terms that appear frequently in private aviation: wet lease and dry lease: describe fundamentally different commercial arrangements. Understanding the distinction matters if you are comparing charter options, evaluating fractional ownership, or looking at aircraft acquisition.

What Is a Wet Lease?

A wet lease is an aircraft leasing arrangement in which one party (the lessor) provides the aircraft, the flight crew, maintenance, and insurance to another party (the lessee). The acronym ACMI: Aircraft, Crew, Maintenance, Insurance: is often used to describe what a wet lease includes.

For practical purposes, a traditional on-demand charter booking is a form of wet lease. When you book an empty leg or charter flight through a platform like SkyAccess, the certified Part 135 operator supplies the aircraft, the crew, the airworthiness maintenance, and the insurance. You pay for the transportation. You are not operating the aircraft in any regulatory sense; the charter operator retains operational control.

Key features of a wet lease:

– The lessor’s crew operates the aircraft under the lessor’s air operator certificate.

– The lessor maintains the aircraft and holds the insurance.

– The lessee receives a transportation service, not an aircraft.

– US FET (federal excise tax) typically applies because it is a commercial transportation arrangement.

What Is a Dry Lease?

A dry lease provides the aircraft only. The lessee receives the right to use the aircraft but is responsible for supplying the crew, maintaining airworthiness, and obtaining insurance. In practice, a dry lessee acts as the aircraft operator.

For a US private individual to dry-lease an aircraft and operate it legally, they typically fly under FAR Part 91 (private, non-commercial operations). This means:

– No passenger may pay a fare for the flight (with narrow exceptions).

– The individual must either hold a pilot certificate or hire crew independently.

– Maintenance and airworthiness are the lessee’s responsibility.

– US FET generally does not apply because there is no commercial transportation charge.

Dry leases are common for aircraft management arrangements, corporate flight departments, and fractional ownership programs where the ownership interest makes the operator’s flight department the “operator” in the regulatory sense.

Why the Distinction Matters for Charter Passengers

If you are booking through a marketplace like SkyAccess, you are booking a wet-lease arrangement in all but name: you pay for transportation on an aircraft operated by a certified charter company. You do not need to think about maintenance schedules, crew qualifications, or insurance.

The distinction becomes relevant when you encounter:

Fractional ownership programs. Companies like NetJets sell fractional shares in aircraft. Depending on the structure and the FAA’s analysis, fractional flights may be treated as dry-lease operations (the share owner is part-operator) or wet-lease operations (the management company is the operator). The regulatory treatment affects taxation and safety oversight.

Aircraft management companies. Some high-net-worth aircraft owners hire management companies to charter their aircraft when not in use. The arrangement between owner and management company is often a dry lease; the management company then charters the aircraft on a wet-lease basis to passengers.

International operations. EU, UK, EASA, and other jurisdictions have their own wet-lease and dry-lease regulatory frameworks. Cross-border leasing arrangements require careful compliance review.

Wet Lease vs. Charter: Are They the Same?

On-demand charter under Part 135 is sometimes called a “wet lease” in common usage, and the ACMI elements match. The formal FAA distinction is that a “charter” is a one-time or ad hoc arrangement, while a “wet lease” may also describe longer-term scheduled or block-charter arrangements. For practical purposes, a single-flight on-demand booking is a wet-lease transaction in its economics.

Dry Lease and FET Avoidance

Because a dry-lease arrangement removes the commercial transportation element, US FET does not apply. Some arrangements marketed as “dry leases” to wealthy passengers are scrutinized by the IRS and FAA as attempting to avoid FET without genuine operational control. The IRS has issued guidance on “sham” dry leases: transactions structured as dry leases to avoid tax but where the lessee does not exercise genuine operational control. These carry significant legal risk.

A legitimate dry lease requires the lessee to hold actual control over crew scheduling, maintenance decisions, and operational authority. Booking a flight through a charter platform and calling it a dry lease does not meet that standard.

Comparing Arrangements on SkyAccess

SkyAccess is a marketplace for empty legs and on-demand whole-aircraft charter: wet-lease arrangements where a certified Part 135 operator provides the aircraft, crew, maintenance, and insurance. The FET for US domestic flights applies and is itemized at checkout. You are purchasing air transportation, not leasing an aircraft.

5,000+ live empty legs from 900+ FAA Part 135 (and international equivalent) certified operators are searchable by route, date, and aircraft category. No membership required.

Common Questions

Is a charter flight a wet lease? In practice, yes. On-demand charter provides the aircraft and crew (ACMI elements). The term “charter” describes the commercial arrangement; “wet lease” describes the supply structure.

Can a passenger book a dry lease instead of a charter to avoid FET? Not practically. A legitimate dry lease requires genuine operational control by the lessee. Booking through a charter platform does not confer operational control.

What is ACMI? Aircraft, Crew, Maintenance, Insurance: the four elements the lessor provides in a wet-lease arrangement.

Are fractional ownership flights wet leases or dry leases? It depends on the program structure and the FAA’s operational control analysis. Some programs are treated as dry leases; others as wet leases. Tax treatment follows.

Does wet lease vs. dry lease affect safety? The FAA’s operational control framework determines which safety rules apply. Wet-lease operations under Part 135 require the certificate holder (the operator) to maintain high safety standards. Dry-lease Part 91 operations apply a different: generally less prescriptive: rule set.

FAQ Schema Questions:

1. What is the difference between a wet lease and a dry lease for private jets?

2. Is a charter flight a wet lease or a dry lease?

3. Does a dry lease avoid the federal excise tax on private aviation?

4. What does ACMI mean in aviation?

5. Do fractional ownership flights use wet leases or dry leases?