TTM05010 - The 75% Limit on Charters-in: Outline

Conditions to be satisfied

It is a requirement of entering or remaining within tonnage tax-

• in the case of a single company, that not more than 75% of the net tonnage of the qualifying ships operated by it is chartered-in;
• in the case of a group, that not more than 75% of the aggregate net tonnage of the qualifying ships operated by the members of the group that are qualifying companies is chartered-in

See TTM05100 for the meaning of ‘chartered-in’.

In practice this test is applied by comparing:

• the total tonnage of qualifying ships ‘chartered-in’ across the ring fence, and
• the total tonnage of the qualifying ships operated by the group.

Where this test applies to an accounting period, the computation is made by reference to the average tonnage chartered-in/operated in that period (see TTM05200)

See also:

• TTM05120 for details of the charters to be taken into account
• TTM05300 for the consequences of exceeding the 75% limit

References