Fitzgerald and Company
Accounting and Taxation Services

Myton House, Moat Road, Headcorn, Kent TN27 9NT
Tel: 01622 890725 Mob: 07725 434115

Seafarers’ Earnings Deduction

The Seafarers’ Earnings deduction is a 100% relief from tax on your earnings as a seafarer if your job entails working outside the UK. A brief summary of the rules are as follows:

You can qualify for the Seafarers’ Earnings Deduction as a seafarer if you perform all your duties on a ship, or you perform most of your duties on a ship and the other duties are incidental to the duties on the ship.
The word 'ship' is not defined in tax law, but 'offshore installations' used in the offshore oil and gas industry are specifically identified and are not regarded as 'ships' for the purposes of the Seafarers’ Earnings Deduction. These include:
- fixed production platforms
- floating production platforms
- floating storage units
- mobile offshore drilling units (both semi-submersibles and jack-ups)
- flotels.
HMRC’s new guidelines published February 2009 regarding offshore installations go further to include those vessels that are being put to a ‘relevant use’ and at the same time are ‘standing or stationed’. See HMRC EIM33193 and HMRC EIM33109 for definitions of ‘relevant use’ and ‘standing or stationed’.

SED can only be claimed by seafarers’ who are resident/ordinarily resident in the UK.
SED is allowed against earnings as a seafarer that fall within a Qualifying Period, and includes leave pay immediately following a Qualifying Period.
The Qualifying Period must be 365 days or more and must not contain more than 183 consecutive days in the UK. At the end of each period outside the UK, the total days spent in the UK must be less than half the total days in the Qualifying Period. The Qualifying Period must start and end with a day outside the UK.
In each tax year, there must be at least one foreign port visit for each employment.
A day of absence from the UK is one where you are outside the UK at midnight.
You can include holidays abroad to make up the Qualifying Period.

If you think you have a valid claim for Seafarers’ Earnings Deduction, we can help you to submit the claim. As you can see, claims can be complex and involved, therefore expert advice is essential.

Please contact us for more information.