H M Revenue & Customs TAX Ruling

[V3]

From a Longstreath Posting.

FED, what the Judge said!
September 22, 2008

"A ruling by the Special Tax commissioners this year has sent alarm bells ringing for those who claim FED.

The case involves the Pride of South America which is a self propelled Semi-Sub, an ex DSV and Drilling Installation which was conducting well work-over type work.

The question the judge had to decide was whether the Semi Sub was an installation or a vessel for FED.

The commissioners ruled that holding station on DP is classed as standing or stationary within the meaning of the offshore installations regulations 1995.

Working in the 500 metre zone is classed as offshore work and being attached to a well or installation by means of a cable or pipe, the vessel becomes part of the installation within the meaning of the offshore installations regulations 1995, although the guidance notes states an intervention of 3 days or more is permanent enough for a ship to be stationed.

What they have said in effect is that any self propelled vessel (which would include a DSV) which holds position using either anchors or DP and is connected to a well or installation by means of a cable or pipe would not qualify for FED as it becomes an installation and installations do not qualify for FED.

The meaning of a cable being, wire, rope, electrical or hydraulic system connected to the installation or well.

The judge expanded the meaning of exploitation when he said; “that exploitation involves several stages in extracting crude oil from a well. The well has to be drilled, its infrastructure has to be completed followed by the production stage and when exhausted closed down. All envisaged from the outset and maintenance and repairs as necessary to keep the field operating so as to exploit the mineral resources with repairs being essential to the exploitation”.

Although the case is legal precedent, it can be challenged where circumstances differ, but this case opens up a whole can of worms in which the tax inspectors will attempt to use to disallow FED when ever a DSV is working on an offshore installation, well or pipeline within the 500 metre exclusion zone for longer than 3 days and connected by a cable or pipe to the well, installation and any pipe-work conducting maintenance or repairs. "

[James McLauchlan]

Written by an Ex-Pat.

I feel that no matter what concessions appear to being made in the longer term the tax ruling will do damage to the British Shipping industry and upset a number of people in the O & G game also. For those that have the will there is a way. For those not prepared to leave the UK you will end up paying tax for sure.

This year it may seem that pipe lay barges and survey vessels are OK.. next year it might be a different story as they gradually do what they do best in the UK…. chip away at your rights and freedom in what is supposed to be a democratic society.

I left years ago, and will not return to a country who’s government is hell bent on ruining what was once one of the greatest ship building and sailing nations ever seen on this earth. With this move they are destroying what little is left of our shipping industry.. just as it seemed to be getting under way again. It’s a very self destructive policy by the very government voted in to look after our nation.

[Andy Shiers]

What I find frustrating James, 👿
I did not vote in these idiots and I cannot find anyone willing to say they voted them in either 😕
This country is going down the pan quite quickly 😯

[OILC_neil]

Guys,

As a member of the forum has already pointed out, the OILC Branch do know about this and our legal team have been alerted. I’m sorry, I’m personally out of my depth on this issue, but I’ll chase it up and get back to you just as soon as I have any information.

neil

[zincanode]

As I have already said, we should push the legality of some judge-on-the-beach defining his version of what is or is not a ship vs. the marine and maritime law definitions as per traditional Rule-of-the-Road.

With this bloody lot in power and the great British legal system in their pockets (thanks Cherrie Blair!) we’ll soon find kites defined as aircraft and you’ll have to pay passenger tax on those when you take your kids to the park.

If V3 is right and they are technical ruling out all claims from DP vessels than this will indeed affect Telecom Cable Layers, as well as deep sea research vessels (of Dr Bob Ballard fame).

If a definition of say 3 days in one spot is used, perhaps the vessels we use will need to come out of the 500m zones at regular periods to conduct "system checks" – or perhaps a vehicle may go rogue forcing the vessel to depart the zone after 2 days 23hrs 55 minutes…if you get my drift 😉

[thinsub]

just on the BBC

http://news.bbc.co.uk/1/hi/scotland/north_east/7638490.stm

[James McLauchlan]

No point not bringing it out in the open….

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

North Sea workers face tax bills

Thousands of North Sea workers could be in line for large tax bills, BBC Scotland can reveal.

It follows a ruling by Revenue and Customs officials which means that some vessels involved in offshore work are no longer classified as ships.

That means many workers may no longer qualify for seafaring income tax concessions.

Offshore uni0n spokesman Jake Molloy claimed the move could cripple the industry.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

[James McLauchlan]

Just reading that makes me think…. How can a ship ‘classed as a ship’ by DNV (or whomever) suddenly not be classed as a ship?

When the British Government is running out of money that’s how!

[mind-when-this-was-fields]

I concur James!!!
Yep the bubbles burst and there is job losses everywhere….
So the government is looking to get as much money from any sources possible…..
Unless your name is Mittal, Abramovic, green etc
So while the non dom rich live tax free the wee man pays again!!
Why don’t we just turn off the taps and stick it right up them:-)))))

[Andy Shiers]

How can a ship ‘classed as a ship’ by DNV (or whomever) suddenly not be classed as a ship?

Aagh that old chestnut 🙂
Well it has to have oars ya see 🙂 Not a sail ! Nooooo not sail , Then that there be a sailing SHIP 😯
It be a boat then 😀
I think if we can Nail the F@#kers down with the 3 day period and be on full pay whilst on board the ‘Boat’ then we can have a day off 😀 You know ………work three days have a day off on full pay 😀
This is becoming increasingly hard NOT to justify becoming a Uni0n member !

[mind-when-this-was-fields]

I concur oh Lostboy!!!!!!!!!!!!!!!!!!!!

[Pascobalbodeano]

Morning folks,

I am sitting on the fence with this one. Sorry.

The tax break was initially introduced to encourage people to sign up for the Merchant Navy after all the war time heroics in which thousands of british sailors lost there lives. It was introduce to encourage people back to sea and to aide the rebuidling of the british merchant fleet.

Historically seafarers earn far less than people working in the oil industry. A captain in the merchant navy earns alot less than most people think, and has a huge amount of responsibility, not only for the company he/she works for but also on a legal level.

I know of new starts in the rov industry that earn nearly as much money as a captain with one of the companies i have worked with in the past. Is this right?? In my view no. They have no where near the level of responsibility and no where near the level of training and experience.

Sorry if this upsets some people desperate to hang onto something that they have gotten by chance. I’ve had 14 years of it so I am personnelly willing to take the hit.

Pascobal Bodeano.

[rigboot]

………. A captain in the merchant navy earns alot less than most people think……..

Then surely this affects the Captains, Mates, Engineers, Deckhands even more than the "Other" personnel affected (as you say we get more money???) & brings the incentive for appeal right to their own doorstep too?

I’m afraid the argument of "who gets paid more" clouds this issue.

The hardships endured by ALL personnel serving on the aforementioned, and now "non-qualifying" vessels, are the same no matter what your position or income may be.

Comments like these only serve to divide the people most affected, when we should be united in this fight.

[rigboot]

… I’ve had 14 years of it so I am personnelly willing to take the hit….
Pascobal Bodeano.

As long as your OK then that’s the main thing eh…………?

[Andy Shiers]

Erh , Lets see 🙄
Nope , Don’t buy that one either 😕
I know captains earning a damm sight more than I earn and so they should !
What we play with ain’t cheap ! most ROV’s are expensive to buy and maintain plus this is ever growing technology which means it is always a growing market and more money input plus it is mostly the Oil and Gas industry and the takings are high because of it !
What I paid for ten years ago to fill my car up with fuel or what I paid for a pint of milk ten years ago has gone up ( Plus the Tax 👿 )
Inflation !!!!!!!!!!!!!!!!!!!!!!!!!!!!
The money has not gone up at the same rate as inflation/Tax
That’s why we ( In Britain ) are constantly having strikes by Fireman/Nurses/Policemen/Farmers/Postalworkers/Lorry drivers/Ambulancemen etc………………………
We are heavily insured and taxed to the hilt because of the "dangerous" Industry we are in , Not with standing that we spend Soooooooooooooooooooooooooooooooooooooooooooooo much time away from family and what we eventually earn our money for 😯
It’s like a prison sentence ! Steel walls , same people day in day out 🙁 Alot of the times bad accomadation as we are Temp crew members !
Captains and Seamen get regular crew changes ………………… We don’t !
The cabins are usually better than ours , The capitains even better ( Taking up half the bridge size where as we have enough to swing a mouse let alone a cat and that’s with the other guys sharing the cabin with you ……. ducking 😯
There are pro’s and cons to both sides ,
I know Capitano’s that have changed over to ROV and ROV that have changed over to Caspitanos ,
But that is not the issue…………. is it 😕

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