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Seafarers Earnings Deduction

If you are a UK tax resident employed as a seafarer then His Majesty’s Revenue & Customs (HMRC) may allow you to claim back 100% of UK income tax paid in relation to your employment on a ship as a Seafarer, provided certain qualifying criteria are met.

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2024 Guide to UK Seafarers Tax

This tax rule is known as Seafarers Earnings Deduction (SED). Vast numbers of people working at sea, presume they do not owe tax or need not declare their income as they do not reside in a particular country.

Whilst there may be no tax to be paid with regard to your income from employment at sea, more often than not HMRC will still expect to receive a declaration of this income.

Seafarers Tax Days Calculator

Why not try using our handy online tool to calculate your initial qualifying period? Our seafarers tax days calculator is completely free!

SED Knowledge Base

Discover all the essential information about the seafarers earnings deduction, and whether you qualify for this tax relief in our knowledge base below:

In order to achieve a qualification for the Seafarers Earnings Deduction, you must satisfy the following criteria:

Establish a qualifying period by spending at least 183 days outside of the UK in the 365 days following your departure
Be an employee onboard a "ship"
Visit at least one foreign port during each employment in the tax year

For more detail about each of the qualifying criteria, read on.

Once you have established a qualifying period, you are able to declare your income under the SED. The simplest way of achieving this is by spending 183 days outside of the UK in the 365-day period following your departure, and by being outside of the UK at midnight on day 365.

You are considered to be absent from the UK on a particular day if you are outside the UK at midnight at the end of that day. Non-work days spent outside the UK may be counted as days of absence.

During your qualifying period you are of course permitted return visits to the UK but must meet the following guidelines:

No single return visit may last for more than 183 consecutive days, and
The total number of days you have spent in the UK is not more than one-half of the total number of days from your first day abroad to the last day of the period you spent abroad after that return visit. Intervening days in the UK may only be counted if they occur between periods of absence. Essentially, you must have spent more than half of your time outside the UK since the beginning of your working overseas, and this is referred to as \the half-day rule\.

The word \ship\ is not defined in tax law, but it is safe to assume that in order to qualify for the SED you must be employed onboard a vessel that can navigate and maneuverer under its own power.

Offshore installations used in the oil and gas industry are specifically identified and are not regarded as \ships\ for the purposes of the Seafarer\s Earnings Deduction. The following list of \offshore installations\ do not qualify for the SED, and is given as a guide only:

Fixed production platforms
Floating production platforms
Floating storage units
Floating production storage and offloading vessels (FPSOs)
Mobile offshore drilling units (drill ships, semi-submersible and jack-ups)
Flotels

If you work on an offshore installation anywhere in the world, you are not regarded as a \seafarer\ for the purposes of Seafarer\s Earnings Deduction and so cannot claim the deduction. The employment duties of a seafarer are regarded as being performed outside the UK if they are carried out on a vessel that is engaged on a voyage or part voyage which begins or ends outside the UK. For this purpose, the UK sector of the North Sea is treated as part of the UK.

You can claim Seafarers Earnings Deduction for the whole of the income from an employment in an eligible period provided that at least one trip either begins or ends in a valid foreign port.

In order to be considered as working wholly or partly out of the UK it is generally held that during every tax year you must either:

Complete a voyage or part voyage that begins or ends outside of the UK. In simple terms complete a voyage to or from a foreign port.
Complete a voyage or part voyage to a rig while it is drilling outside of the UK territorial limits and outside a designated area. This is regarded as ending outside the United Kingdom and the return voyage will be one that begins outside the United Kingdom.
Complete a replenishment at sea operation outside of the UK territorial limits and outside a designated area.

Complete our FREE test to see if you can claim back income tax paid in the UK as a seafarer.

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Seafarers Earnings Deduction FAQs

Common questions on the Seafarers Earnings Deduction answered.

Although we do not require copies of the following documents in order to complete your tax return and claim the Seafarers Earnings Deduction, it is beneficial for you to keep them in case of the unlikely event that HMRC ask to see evidence of your circumstances to substantiate your SED claim.

Forms of evidence that you can keep for yourself include:

Discharge book
Flight stubs
Payslips
Seafarers Employment Agreements (SEA) or other employment contracts
Bank statements

Whilst proving you were outside the UK at exactly Midnight in any given date does come with its obvious challenges, it\s important to keep as much documentary evidence as possible. Good examples which are used commonly follow:

Discharge Book
Employment Contract
Flight Stubs
Payslips
Captains Letter
Bank Statements

Whilst the above are the most common, any document which assists in confirming your whereabouts on a given day should be added to your records.

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Seafarers Earnings Deduction

2024 Guide to UK Seafarers Tax

Seafarers Tax Days Calculator

SED Knowledge Base

Should Seafarers Pay Tax?

What is the Seafarers Earnings Deduction (SED)?

How To Qualify For SED

Establishing a Qualifying Period

Your Employment Must Be Onboard A Ship

Valid Foreign Port Call

What Defines Outside the UK to Qualify for SED?

Seafarers Earnings Deduction FAQs

I’m Non-UK Resident - Can I Claim Seafarers Earnings Deduction?

Why You Need To Act Now

How to Claim the Seafarers Earnings Deduction

Types Of Evidence That You Need To Keep

When To Submit Your Seafarers Tax Return

Where Is Or Isn't Considered Abroad?

Is the North Sea UK Continental Shelf (UKCS) Considered Outside UK?

How Can I Prove That I Was Outside The UK On A Specific Day?

What Defines A Day Outside The UK?

How Many Days' Holiday Per Year Can Be Included In Total Days Outside The UK?

If I Have Another Job In The UK, Will This Affect My Claim?

Do Floating Production Vessels Qualify For SED?

Does Dry Docking A Vessel Affect Your Claim?

Does Work On A New Build Affect My SED Claim?

Can I Study Or Attend College Whilst Claiming SED?

What Income Needs Including On My Tax Return?

When Do I Submit My Tax Return?

What Happens If I File My Tax Return Late?

Why Does Everyone Emphasise The Anniversary Date Of A Claim?

Should I Make Repayments On My Undergraduate Loan With The Student Loans Company?

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