[nessrul]

I'm new to yachting. I have been fascinated by the customs of flying flags. First, is it true that most boat/yacht owners register their boats in their own countries? I have seen many yachts flying Cayman Island flags, even though the owners don't live in CI. Is it for tax purpose or some other reasons? And are there any advantages of registering your boat in other countries? Which countries are most popular for boat registration?

[sailronin]

There are many options for country of registry (flag state) for a yacht. Some are tax reasons, cabotage regulations, classification societies and ability to employ crewmember of various nationalities.
When looking are larger yachts (greater than 120 feet) you will find the majority are not flagged in the owners home country.
Many yachts have never visited the "home port" painted on the transom.

Dave

[outmywindow]

A bit more insight...
http://www.redensigngroup.org/

[YachtNews]

that is very true sailronnin in that many of them haven't visited their country of registry and in a few instances with the smaller yachts i have seen them flying stern pole flags other than what is painted on their stern...for example...Georgetown C.I and then flying a Vincentian flag...