If you work on board a vessel which is involved in the Oil and Gas Industry, working on the UK Continental Shelf, and are resident outside of the UK, but in the EU or EEA, you may be entitled to claim your UK tax back under the Seafarers Earnings Deduction (SED) rules if you are PAYE. Alternatively, if you are paid gross, you may be exempt from UK tax SED. If you are UK resident and paid gross, you need to declare your income in the UK regardless of whether or not you have a claim. If sufficient time has not been spent out of the UK, you will be liable to pay UK tax. The conditions for a SED claim are as follows;

  • In very basic terms have spent more than 183 days out of the UK during a 365-day period (first year, although it is slightly more complicated than that because you also need to satisfy 'the half day rule')
  • You are on an employment contract (cannot be self employed)
  • You visit at least one foreign port (or Rig in foreign waters) in each tax year with each separate employer
  • You work on a qualifying vessel not an offshore installation (Rigs, Jack ups etc, please also refer to the note below)

If you think you have a claim, please send/email us the relevant information below, together with the completed enrolment forms;

  • Photocopy from your discharge book
  • If not shown in your discharge book, proof of a foreign port
  • Boarding cards if you flew out to join your vessel earlier than the date shown in your discharge book, the same with returning back to the UK
  • Details of any courses or holidays abroad, such as flight tickets, boarding cards, accommodation receipts, or visa/credit cards receipts
  • P60/P45 if PAYE
  • If paid gross, wage slips or bank statements showing the gross amounts received
  • Employment contract

There are many different types of vessels used in the oil and Gas Industry including:

  • Supply Vessels
  • Anchor Handler Vessels
  • Pipelayer Vessels
  • Construction Vessels
  • Survey Vessels
  • Multi Purposes Vessels

All of these vessels should qualify for SED however there are some types of vessel which HMRC may, in some certain circumstances, be treated as 'OFFSHORE INSTALLATIONS'. These vessels will NOT qualify for SED. The most common types are:

  • Well Service vessels which work directly at the well head whilst stationary for 5 days (per HMRC guidance) or more.
  • Any vessel which acts as an accommodation unit, so is attached to a Rig and the workers transfer on to it each day.
  • Any 'Jack Up' which is is involved in work at the well head.

When considering whether a vessel qualifies for SED there will be grey areas and there may be disagreements with HMRC as to what qualifies for SED and what does not. These cases are usually amicably resolved but if you are aware of any difficulties please let us know.