EIM33001 - Seafarers’ Earnings Deduction: general conditions

Section 378 ITEPA 2003

A deduction is allowed from earnings from employment as a seafarer (see EIM33101) if all of the following conditions are met in the tax year:

• the earnings are taxable under Section 15 or 21 ITEPA 2003 (earnings for a year when the employee is resident and ordinarily resident in the United Kingdom, see EIM40101)
• the duties of the employment are performed wholly or partly outside the United Kingdom (see EIM33031)
• any of those duties are performed in the course of an eligible period falling wholly or partly in the tax year (see EIM33004).

The tests are applied separately.

See EIM33002 for how to calculate the deduction.

Deduction not exemption

Section 378 provides for a deduction from a seafarer's earnings in order to calculate the net taxable earnings from employment. It does not exempt the earnings from tax.

National Insurance

The deduction applies for tax purposes only. For information about seafarers’ liability to National Insurance Contributions (NICs), see NIM29002 onwards.