Taxing tax questions…still a grey area.

[Steve White]

The designated areas

The Continental Shelf Act (1964) identified certain areas of the North Sea and North Atlantic as being within the jurisdiction of the United Kingdom for the purposes of oil and gas exploration and exploitation. Section 41 ITEPA 2003 deems that any general earnings arising from employment duties performed in a designated area in connection with exploration and exploitation activities shall be treated as if they arose from duties performed in the United Kingdom.

Designated area means an area designated by Order in Council under Section 1(7) of the Continental Shelf Act, 1964. These areas comprise, broadly, the United Kingdom sector of the continental shelf. They extend in the north to latitude 62N. They are divided into quadrants numbered from 1 to 211, and each quadrant is subdivided into up to thirty blocks. An offshore location is usually identified by the quadrant and block number in which it is situated, for example, the Piper field is in block 15/7 and the Brent field is mainly in 211/9.

[Ray Shields]

And in English – anywhere inside the UK sector of the North Sea is the designated area.

Basically if you work on a ship in the Uk sector of North Sea only you cannot get your tax back..

However, I know several people who have successfuly claimed their tax back and they counted work they did exclusively in the UK sector of the North Sea. Between 94 and 00 I successfuly claimed all my tax back and that included trips I did out and back in to Aberdeen without leaving the Uk sector. I was one of the many investigated in 200 and passed OK (unless these rules have come in since then?)

[Steve White]

Yes, you are cirrect, in plain English…anywhere inside the UK sector of the North Sea is the designated area and if you work on a ship in the UK sector of North Sea only you cannot get your tax back..

"Section 41 ITEPA 2003 deems……" so it probably did not apply to you in 1994-2000.

[Ray Shields]

Guessed it had changed 🙂

But as I said, I still know people who have sucessfully claimed their tax back and included trips within the UK sector in their claim period. Or is it just that they haven’t been asked to prove it and if they were then they would be stuffed?

[Steve White]

They probably haven’t been asked to prove it……..yet. Many have successful claims initially. But remember what it says on the assessment…HMRC always give themselves the caviat that they can come back at you at any time.

[Ray Shields]

So just to confirm (it takes a while to sink in!)

If you are on a vessel and leave a Uk port, work only in the Uk sector and come back into a UK port (or depart the vessel within the UK sector), NONE of the days of that voyage can be counted towards your 183 days you need.

If you depart from a UK port sail and work in the Norwegian sector and then sail back into a UK port, NONE of these days can be used towards your 183 day qualifying.

If you are on a vessel which starts its voyage outside the UK sector and ends in a UK port, or starts in a UK port but ends in a foreign port or depart the vessel anywhere outside of the UK sector, then this voyage CAN count towards your 183 days.

Does transferring cargo at a platform outside of the UK sector still class as a foerign port call (or did it really ever??)

I am concerned at the section where you say

If you are outside the 12 mile limit but in a designated area of the continental shelf at midnight on that day then that day is NOT a qualifying day.

Does this mean If I sail from Aberdeen and arrive in Stavanger, the days transiting between Aberdeen and entering the Norwegian sector cannot count towards my 183 days.

And finally (phew!) again between 94 and 2000 I could use any days I spent out of the UK on holiday as qualifying days towards my 183 out of the UK- can you still do this?

Thanks again for all the feedback in what is a nigtmare of an area. Glad I dont try and claim my tax back anymore! I just work less instead 😀

[mind-when-this-was-fields]

A transfer of cargo from a platform outside of the UK does count as a foreign port call Ray.
What I don’t understand is if the days working in the UKCS don’t count, how can tax companies dealing with seafarers tax promote themselves in getting your tax back??? Surely there is a lot of guys doing a trip here and there in UK waters every year which is bound to muck up their tax days???
I know of people doing self assessment tax returns including UK jobs and they seem to get their tax back.
EVERY year!!
Or is it still a grey area for everyone……. 😆

[Ray Shields]

A transfer of cargo from a platform outside of the UK does count as a foreign port call Ray.

I know of people doing self assessment tax returns including UK jobs and they seem to get their tax back.
EVERY year!!
Or is it still a grey area for everyone……. 😆

Thanks, I had heard about the cargo transfer but rules seem to change all the time – and if the Taxman asks you to PROVE there was a cargo transfer done at, say, Troll how do you prove it?

People claiming tax back is easy. You say to the Taxman "Im entitled to this, give it to me" and he does.

The DIFFICULTY comes when the Taxman goes "you know that tax I gve you back 2 years ago? Well, prove to me you were entitled to it"

When they start doing this, THATS when people will come unstuck. :L :L

[mind-when-this-was-fields]

Well Ray,
I got a photocopy of the manifest from the ship, showing the platform,sector etc and got the ships stamp and captain to sign it.

[T-Boy]

Thanks for the input. Fortunately for me I don’t work in the UKCS, I thought the 12 mile limit was the only way to be sure to be untaxable, and keep proof i.e print out of LAT/LONG or something similar.

It still appears to be dependant on which Tax office you deal with, what day of the week it is and if you are lucky or unlucky.
It is deliberately difficult, and not easy to understand.

And the revenues’ catchphrase is Roy Tax doesn’t need to be taxing
my ar$e 😕

Still, seems interesting that the agencies are changing their stance with subtle wording changes in their ‘contracts’ etc with agency personnel, and ensuring that in no way are freelancers employed.

[Steve White]

Ray, you are correct with your assumptions in the examples you set out…..and yes, transfer of cargo does count as a foreign port call.

With your example from Aberdeen to Stavager – you can only start counting the qualifying days from the time you enter the Norwegian sector, any time up to that point can not be counted.

Yes, you can still use days out of the UK on holiday as qualifying days.

[Ray Shields]

Ray, you are correct with your assumptions in the examples you set out…..and yes, transfer of cargo does count as a foreign port call.

With your example from Aberdeen to Stavager – you can only start counting the qualifying days from the time you enter the Norwegian sector, any time up to that point can not be counted.

Yes, you can still use days out of the UK on holiday as qualifying days.

Thanks, its a wonder ANYONE can claim their tax back these days (legally that is). If the Taxman decided to start investigating everyone there would be a large increase in Revenue income!

[Author]

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