Seafarers Tax about to change

arealhighlander

Previously, Seafarers (people working on ships) have been able to claim back all of their UK tax if they qualify (by staying out of the country for more than 6 months in any year plus other rules).

Following an appeal, the Taxman has changed the definition of a ship ruling out any ship working on Oil & Gas projects that station keeps (known as DP, dynamic position - which is the majority of new vessels being used in Oil & Gas Industry) or does work on oil structures on the seabed.

This will now mean thousands of workers on ships are now no longer going to be able to get their tax back (in fact the taxman is now going to change the rules from any claim since 14 Jan 08 meaning some who got their back may have to pay it back!). This will mean hundreds of millions of £'s going back into the HM Revenue coffers.

The following email was received from HM Revenue following a query to confirm the story:-

===========================
Dear Sir
I have received a number of e-mails on this subject so have prepared the following as a global response.

HMRC has now considered the impact of the Special Commissioners¿ decision SPC0679, the Pride South America (PSA) case, in relation to claims to Seafarers¿ Earnings Deduction (SED). The decision is at:-,
www.financeandtaxtribunals.gov.uk/Aspx/view.aspx?id=3869

It is intended that revised guidance on these matters will be available from December 2008 on the internet at:-,
www.hmrc.gov.uk/manuals/eimanual/EIM33104.htm

However, as a matter of customer service, I can now advise you that claims submitted on or after 14 January 2008 will be considered in the light of the PSA decision.

Construction/construction support/well service and dive support vessels will no longer be considered to be ships for the purposes of SED. Pipelaying barges may continue to be considered as ships if involved solely in laying pipes.

Yours sincerely
Cardiff Marine Section

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colino

About time! When I was away deepsea for 45-46 weeks of the year I was seriously annoyed that people having their permanent place of work over a damp patch were benefitting from the tax laws!

Cook_County

Just remember that the Spice Girls were partly responsible for the last major change in this legislation in 1998 - http://findarticles.com/p/articles/mi_qn4158/is_19980614/ai_n14151011!

stoporilshoot

colino wrote: »

About time! When I was away deepsea for 45-46 weeks of the year I was seriously annoyed that people having their permanent place of work over a damp patch were benefitting from the tax laws!

I'm away worldwide for more than 6 months of the year and am employed as marine crew, the vessel I'm on is contracted to the oil and gas industry.
I take offence that you cover everyone with the same blanket so to speak.
Let me put it this way:
Why do you think there are very very few junior British officers or British AB's employed on the deep sea runs? ... Simply because cheeper labour is available. The same is happening in the offshore sector, the seafarers foreign earnings deduction was introduced to try and keep the British Seaman competative.
By taking the FED away from the likes of myself we are now going to be the extremely poor relations. I work with guys on the same job from other countries, they drive mercs/Audi's , I drive an R reg Astra. My standard of living is already well below these guys, to drop my nett earnings by around 20-25% is the bottom of the barrel.
Like I say I am marine crew.....I don't have the luxury of BUPA, sick pay, pension contributions from my employer...which by the way is some cypriot hiding behind a flag of convenience and a brass plate somewhere in Liberia.
The truth is the RSS has been giving out willy nilly seamens books to anyone. Once they have a discharge book they become seamen in the eyes of the Inland Revenue and rightly or wrongly become eligble for FED.
I THINK YOU SHOULD THINK BEFORE YOU SPEAK MATE!

goingashore

stoporilshoot wrote: »

I'm away worldwide for more than 6 months of the year and am employed as marine crew, the vessel I'm on is contracted to the oil and gas industry.
I take offence that you cover everyone with the same blanket so to speak.
Let me put it this way:
Why do you think there are very very few junior British officers or British AB's employed on the deep sea runs? ... Simply because cheeper labour is available. The same is happening in the offshore sector, the seafarers foreign earnings deduction was introduced to try and keep the British Seaman competative.
By taking the FED away from the likes of myself we are now going to be the extremely poor relations. I work with guys on the same job from other countries, they drive mercs/Audi's , I drive an R reg Astra. My standard of living is already well below these guys, to drop my nett earnings by around 20-25% is the bottom of the barrel.
Like I say I am marine crew.....I don't have the luxury of BUPA, sick pay, pension contributions from my employer...which by the way is some cypriot hiding behind a flag of convenience and a brass plate somewhere in Liberia.
The truth is the RSS has been giving out willy nilly seamens books to anyone. Once they have a discharge book they become seamen in the eyes of the Inland Revenue and rightly or wrongly become eligble for FED.
I THINK YOU SHOULD THINK BEFORE YOU SPEAK MATE!

I agree with all the points given. Having worked as a marine engineer on offshore ships for 16 years . I have seen the number of guys getting discharge books stamped using the ships stamps rise and rise. It looks like seamans tickets and certification count for nothing. And this ruling will only drive people away from the sea into shore jobs, leaving it all to the lower paid yes men of countries like India. Fair well to the British marine industry..

wuzimu

There's some good information on these new changes here:
http://www.sktax.co.uk/seafarers-tax-changes.php

eilidh_s

I too work deep sea and I am appalled at the changes in legislation. I was considering going offshore but now I don't think I could afford it. There is hardly any incentives left for us to go to sea when companies are taking on cheaper crews and if this goes any further then it will be the death knell for the British merchant navy which is disgraceful.

wuzimu

SK Tax Service have just posted some more information on this on their site..