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Taxes, Foreign Flagged in the US and/or EU, DUI's and Yachtmaster
Atticus
Posted: Saturday, November 27, 2010 6:56 PM
Joined: 22/10/2010
Posts: 5


A few questions maybe someone here has experience with; 1) If a crew is working on a FF vessel in the US and that vessel is holding a cruising permit, do they pay tax to the US Gov., IE are they required to file with IRS? 2) What about if that vessel is traveling around Europe, are they required to file in each of the countries where the boat goes, or how does that work exactly? 3) DUI's and Yachtmaster Licenses etc. If a captain or crew obtains a DUI in a motor vehicle, is there any penalty/revocation of their Yachtmaster License? Should they forget about ever getting on insurance again? IE, what are the real life implications of this in the yachting world?
Anonymous
Posted: Sunday, November 28, 2010 3:08 AM
Speaking for the US flagged commercial world... USCG licenses... If you get a DUI there is an excellent chance your license will be suspended or revoked depending on the circumstances, and you will have to jump through many legal hoops just to keep your license if the USCG opts to let you keep it. These days it is also not uncommon for you to be terminated by your company, especially if you are working in the Gulf of Mexico. My advice is 1) DON'T DRINK AND DRIVE if you have a boating license of any sort. 2) GET THE MOST EXPENSIVE LAWYER YOU CAN FIND and pay him USD10,000 to try and beat the DUI!
chrismlewis
Posted: Tuesday, November 30, 2010 7:27 PM
Joined: 09/10/2008
Posts: 121


No, generally, you do not need to file tax returns if you are working on a foreign flagged boat. Nothing to do with the cruising permit, you are working on the "soil" of the flag of the boat. ie if you are working on a Cayman Flag boat you have to go by their tax laws. But this also applies the "wrong" way if you are on an EU flagged boat... DUI, bad news all round. You will most likely be fired and unemployable.
Captroy
Posted: Tuesday, November 30, 2010 8:11 PM
Joined: 11/06/2008
Posts: 1


Taxes have more to do with where you are from than where the boat is or where it is flagged. Different countries have different rules regarding this. If you are from the US then you pay US taxes regardless of where you are or what flag your boat is.
Anonymous
Posted: Tuesday, November 30, 2010 9:31 PM
Re: Taxes - is it really all about the flag? Let's say you are Canadian working on a Cayman flagged boat in California, USA. Does anyone know what the Canadian law is on this? What if you are a USA permanent resident?
Anonymous
Posted: Tuesday, November 30, 2010 10:08 PM
Canadians are required to report ALL earning, ALL the time no matter where or when or who...BOTTOM LINE. Having said that, you may apply for non-resident status and try to wave them, but s soon as you apply you are subject to a ruling from the courts with no hard line or criteria, each situation is viewed independently. After to report earnings, you may be subject to a foreign income tax credit which will lower the amount of earnings you pay tax on and sometimes at a reduced rate. There is more on-line about this in the Canadian Government website.
rodsteel
Posted: Tuesday, November 30, 2010 10:30 PM
Joined: 25/06/2009
Posts: 277


As specifically mentioned in the previous post and in general, the key to any individual's tax liability is their "tax residence" and any relevant "double taxation treaties".

http://en.wikipedia.org/wiki/Tax_residence

 

For Canada

http://britishexpats.com/wiki/Tax_Residency

http://wiki.galbijim.com/Tax_issues_for_Canadian_expats

 

For USA

http://britishexpats.com/wiki/Taxes_filing_with_the_US_IRS_in_London

and this (it is for English Language Teachers in foreign countries but much of it applies)

http://www.hyogoajet.net/wiki/Taxes_Back_Home

 

For tax treaties

http://en.wikipedia.org/wiki/Double_taxation

http://en.wikipedia.org/wiki/Tax_treaty

 

I believe the short answer to your questions are if you wish to avoid taxes in your country of citizenship or (in the US case) permanent residence, you will have to arrange your affairs to qualify for expatriate status in another 'tax treaty" location (not easy to do if you work on a yacht). In the case of permanent residence you will also have to arrange for formal extended stay status (for a greater than six month period) outside the US if you wish to maintain that status.

 

Rod

 

P.S. if the yacht is not cruising in waters of either the citizenship country or tax treaty country then I believe the Flag State would then apply.

 


hiline0209
Posted: Thursday, December 2, 2010 2:32 AM
Joined: 04/10/2010
Posts: 1


For a US citizen working abroad, or working on a FF vessel, in tax yr 2009 you are required to file an information return only if you earn less than 90k USD or foreign currency equivalent, NON-INCLUSIVE of company provided lodging and meals (live on board). So, if you are earning less than 90k plus meals and a cot you are supposed to file an inform. return with IRS. In reality almost no one does, and unless your vessel actually gives you a US 1099 then my view is it's none of their business. Spend the savings on a good attorney, as US citizens are screwed HARD on DUIs re the USCG.
Richard Collings
Posted: Thursday, December 2, 2010 11:21 PM
Joined: 14/10/2008
Posts: 3


For UK Seafarers the HMRC takes a very easy line. If you spend less than 183 daysa year in the UK you may be eligible for Seafarers Earning Deduction (SED)

You can apply for a Seamans Discharge Book for proof of your seafarer status,and recording of you sea service for the MCA. This also allows you marine tickets with the airlines, reduced, refundable tickets with double luggage allowance

http://www.mcga.gov.uk/c4mca/mcga07-home/workingatsea/mcga-rss/mcga-rss-revalidation.htm

More info at the HMRC

http://www.hmrc.gov.uk/cnr/seafaq2.htm

It pays to engage a tax accountant, who specializes in Seafarers tax, to do your annaual returns as you will easily recover the costs back in tax refunds from saving accounts interest, etc.

 
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