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Tax ruling may affect UK yacht crew
Posted: Wednesday, February 17, 2010 7:16 PM
Joined: 01/05/2008
Posts: 41

A ruling by the Court of Appeal today may have tax implications for UK nationals working as yacht crew. A businessman living in the Seychelles since 1976, who had spent less than 91 days a year in the UK, was deemed by the court to still be a resident because of his connections to the UK; he now owes 12 years of back-taxes. The judges stated that the "91-day rule" does not establish non-residency.

The person who sent me the BBC story (link to news story) points out that many UK nationals working on yachts erroneously think that if they are in the UK for less than 90 days a year, they don't owe taxes. But things like a UK phone, family, club memberships and pets can be used to prove ties to the UK, particularly if you're not declared a resident elsewhere.

He says, “Head in sand is no longer an option for the industry.”
Th. Freeman
Posted: Wednesday, February 17, 2010 8:25 PM
Joined: 04/05/2009
Posts: 24

This is not too much of an obstacle for crew. If you leave the UK (to work away) you just need to sign a P85 form to declare the fact your leaving/or have left.

I spent ten months away on a tug, signed a declaration out and then back in (upon return) and even got a full refund on any tax paid for the work in the remainder of the tax year.

Th. Freeman 1 - Tax man 0!

You'll find it here:

Dan Heath
Posted: Thursday, February 18, 2010 5:06 PM
Joined: 02/08/2009
Posts: 5

Spot on Freeman.

In addition to the P85 , UK Residents (or residents for tax purposes) may also qualify for the Seafarers allowance.

We have some information about this and other tax related issues on our website

UK Portal

Dan Heath
Yacht Crew Management

Posted: Thursday, February 18, 2010 9:15 PM
The main problem Yachties have is, if they declare themselves to be a non-resident, they have to declare an address where they DO live.... do they accept:

M.Y. Stink Pot,
Somewhere in the Med.?

How concerned should we be about having a UK phone contract, or a UK car (albeit being driven on the continent)?

Also, any idea if non-residents can still be on the electoral register? I only ask, as this is one of the key things to bump up your credit score for the future, so that when we do go back we have some sort of hope to get mortgages etc.

Posted: Saturday, February 20, 2010 6:59 AM
Joined: 09/10/2008
Posts: 134

There are a bunch of requirements, but basically British seafarers get a 100% deduction on their income tax bill (for income relating to employment on board a yacht, ship, whatever, not investments, rentals etc). Get a seaman's book, stay out over 50% of the time, foreign going vessel etc etc. there is a box on the tax return (digital and paper) and lots of info on the website.

Keep lots of documentation to prove what you are claiming as you are liable to audit from time to time, I think back as far as 6 years, but not sure about that. boarding cards, credit card receipts, discharge book record of seatime, payslips, contracts etc

Posted: Saturday, February 20, 2010 7:18 AM
Joined: 14/10/2008
Posts: 33

British citizens living abroad are able to vote in parliamentary elections, and EU elections, but not in council elections. After 15 years of continously living abroad you loose your right to vote. Irish & Commonwealth citizens, who can vote when resident in Britain, loose this right upon leaving.
Posted: Saturday, February 20, 2010 7:25 AM
Joined: 14/10/2008
Posts: 33

As a point of interest, specifically to British citizens living in France & Spain, who lament the fact that they are barred from voting in parliamentary elections in those countries, foreign nationals, including EU nationals, who legally are long term residents and tax payers in Britain, CAN NOT VOTE in parliamentary elections either, only in council and EU elections.
Posted: Saturday, February 20, 2010 10:08 AM
STOP...... Lets stop scare mongering and tell the truth......trying to get yachties to pay tax will never happen. The British goverment is so incompitent its not going to happen. Its only the people who pay taxes are bothered about it. Ive not for 30yrs. The dock walk is only a deckhands comic.....and should be treated as such.
Posted: Sunday, February 21, 2010 12:34 PM
I may not be from the UK, but I can assure you there are more reason why you should pay your taxes. 1 you build credit and have valid proof of income 2 when you file your taxes you will get a tax refund (I've got money back even when I pay tax in the USA) 3 you know exactly where you stand and don't need to worry about tax problems later Avoiding taxes is foolish, reducing your taxable income and making sure your not going to pay a penalty later is wise The world is changing and the taxmans arms are reaching far and wide for revenue, goverments derive their income fro tax and if you want to complain about your country I suggesst you pay for the right to have an opinion
Posted: Thursday, March 25, 2010 12:04 PM
Loving your head in the sand option Anonymous (20 Feb 10.08) !!! Next you'll be telling us all that you just have to hide your money in offshore accounts !!! Keep up the good advise!! The banks are being forced to hand over lists of account holders to the various governments. I know several people who have received letters from the UK despite working on boats for 10 / 15 + years. They have had to document to the tax office's satisfaction ALL their movements and vessels for the entire period (back to when they left college). Maybe they are not as incompetent as your spelling!! The UK's rules for seafarers are very generous and if you keep up to date should cost you no more that a couple hundred quid a year to make an SED (Seafarer's Earnings Deduction) claim. You will then be completely legal and still have no income tax liability. National Insurance rules are different. The glory days are over. Get legal on your terms not theirs.
Posted: Thursday, March 25, 2010 1:23 PM
Posted: 20 February 2010 10:08 STOP...... Lets stop scare mongering and tell the truth......trying to get yachties to pay tax will never happen. The British goverment is so incompitent its not going to happen. Its only the people who pay taxes are bothered about it. Ive not for 30yrs. The dock walk is only a deckhands comic.....and should be treated as such.

You must work for the Triton. These forums are here to help not hinder. Grow up or get out of the industry
Yacht Crew Management
Posted: Friday, March 26, 2010 6:53 AM
Joined: 22/08/2009
Posts: 6

The fact is that the tax (revenue) departments of most developed countries have changed considerably in the last 30 years and will continue to become more sophisticated in the hunt for ´missing´ tax revenue.  If you have made the appropriate provisions then you have nothing to worry about – if not you may get a nasty surprise.
Caroline Freedman
Posted: Sunday, April 4, 2010 2:45 AM
Joined: 24/10/2008
Posts: 3

I would like to say thank you for the very coherent information. It's true, the world is changing, I have just worked in London, UK for a year (family reasons) in the Public Sector and can tell you that the incompetency is no longer. Everything is being networked and digitalised and systems are being upgraded. Corporate private sector managers have been headhunted and given huge pay packets to turn the feeble mismanagement into a well oiled machine. Those of you who do have your head in the sand or have offshore accounts might like to take note of the advice that has been given here and get your papers in order. PS: How do I apply for a Seaman's Book as a stew with 3 years in the industry? Is it true that with a seaman's book we yacht crew can also get a discount on excess baggage at airport check in? Thanks again
Posted: Sunday, April 4, 2010 1:49 PM
Joined: 13/09/2009
Posts: 1

SIMPLE DON'T CLAIM UK BENEFITS. The burden of proof lies with your ties to the UK. As the article points out the 91 rule no longer applies however, there are things that do that I can recommend you avoid. To remain exempt from UK tax DO NOT under any circumstances establish any association to the UK. DO NOT use gov sponsored medical DO NOT take first home buyers grant, DO NOT take unemployment benefits when you find your self unemployed, Establish a familly or residence in the UK. These are all the things that provide the Gov with a reason to claim your ties to the UK are sufficient to warrant you paying tax. Simple if you use the system you have to contribute. Otherwise get your paper work in order and sign out and in as a sea man. Good luck
Posted: Wednesday, April 7, 2010 12:47 PM
Joined: 01/12/2008
Posts: 62

This is a very interesting thread. I think that the 'Gains-Cooper' case that is mentioned at the top is evidence that the EU and G20 countries (backed by research from the OECD) are really concentrating their efforts on the so called 'offshore' or 'nomadic' population... and why not, all devoloped countries are in dire need of money and raising it through taxing the super rich 'tax dodgers' is both media and voter friendly.

This case shows that the rules for "residency" and "domicile" are starting to overlap. I am writing an ariticle for Dock Walk vey soon on this very subject (keep an eye on Its Your Money, normally page 64). The basic truth is that the world has changed dramatically in the last 4 years and the rate of change is increasing and members of the yachting community are going to be caught up in the clamp down. When you walk through any of the big airports in the UK now you will see shiny new offices down each side, these used to be just for customs and police but now they include rooms for tax inspectors. Our electronic borders are becoming stronger and if you are indeed tax resident in the UK and dont at least declare your income to them (you may not have to pay anything) then they will catch up with you sometime. If you think you will continue to get away with it then just ask yourself how you will renew your passport next time you need to?

I dont believe that scare mongering is neccesary, but ALL crew should at least understand where they MIGHT be resident, which isnt just your place of citizenship. Simply making a declaration to the UK, even under the seafarers exemption, doesnt mean you have done all you need to do... you might be resident somewhere else (where does the boat spend most of it's time?).

This case has changed a lot but you dont need to panic... yet; keep a diary of all of your movements (flights, berths etc) and then look back at it at the end of the year and total up the days in different countries... if you are then in any doubt, take advice.

Posted: Sunday, March 25, 2012 2:09 PM
Joined: 25/03/2012
Posts: 1

Thanks Pete for a level-headed response. I want to do the right thing for my circumstances. Would anyone know a tac/residency advisor in the South of France. Thanks
Posted: Sunday, April 8, 2012 1:31 PM
Joined: 13/10/2011
Posts: 2

Anyone know any tax accountant in the UK that specialise in residency/seafarer/tax advice?
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