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United Kingdom

Maritime minister steps in to support seafarers tax provision

10 August 2020

Maritime minister Kelly Tolhurst has stepped in to support Union calls for clarity over specific measures to support seafarers on tax provision during the pandemic.

Seafarers who have been unable to join their vessels due to pandemic travel restrictions are likely to be hit with an unusually large tax bill because their forced home stay has meant they have not spent enough days outside the UK to qualify for Seafarers Earnings Deduction (SED).

Nautilus general secretary Mark Dickinson said: 'We really appreciate the maritime minister fighting our corner on this issue. We look forward to some positive decisions soon to support seafarers and the maritime industry on finance and tax, especially as the sector will be crucial to post-Brexit efforts to kick start the economy as it emerges from the pandemic.'

On July 16 Ms Tolhurst secured a commitment from UK financial secretary Jesse Norman to review Her Majesty's Treasury's (HMT) position on SED. Mr Norman, who is the Minister with strategic oversight of the UK tax system, had previously told the Union he would not consider changes the rules on SED at this time.

'While [Mr Norman] was unable to give a definitive answer during the meeting he now has a much clearer understanding of the circumstances and is appreciative of the position that many of our seafarers find themselves in. He has agreed to give it further consideration and will discuss it again with his officials,' Ms Tolhurst told the Union in a letter.

The Union has suggested a temporary easement to the eligibility criteria for SED. The SED offers a 100 per cent reduction in income tax on maritime employment income for UK and EEA resident seafarers who have a qualifying period absent from the UK. The qualifying period must be made up of at least 365 days but return visits to the UK during that time up to a maximum of 183 consecutive days, can count towards the qualifying period.

If a seafarer is unable to meet this eligibility criteria, they will not qualify for the deduction and will owe normal rates of income tax and National Insurance Contributions (NIC) on their earnings.

Nautilus, the RMT union, and UK Chamber of Shipping have jointly raised the SED issues with the UK government over the last few months.

Ms Tolhurst promised to liaise closely with Her Majesty's Treasury and will keep industry bodies informed of any progress.

The Union has also urged members to write to their MPs in a letter writing campaign to put pressure on the UK government by writing to their MPs.

Nautilus has been working hard to ensure members are treated fairly during the Covid-19 pandemic, with successes such as ensuring the UK government designated seafarers as keyworkers and that the furlough scheme was applied to as many maritime professionals as possible.

A survey of UK members found that 11,000 seafarers have been unable to access government financial support schemes during the pandemic.


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