HMRC invites retrospective claims to seafarers’ earnings deduction

The seafarer's earnings deduction (SED) in ITEPA 2003 ss 378-385 was extended to ‘EEA seafarers’ from 2011/12. HMRC has announced in Revenue & Customs Brief 10/12 that it now considers that EU law requires that SED claims for earlier years, made by those who were not UK resident or ordinarily resident in the relevant tax year, should be allowed where the claims are made ‘within the same time limits that apply for making such claims by those who were UK resident or ordinarily resident in the relevant tax year’.

An EEA seafarer is one who is resident for tax purposes in a European Economic Area state other than the UK – guidance is provided in HMRC’s Employment Income Manual at EIM33001.

HMRC will consider retrospective claims made on or before 31 July 2012:

• for 2007/08 by a person who was not UK resident or ordinarily resident for that year; and
• for 2006/07 by a person who was not UK resident or ordinarily resident for that year ‘provided that person's tax affairs were, for that year, not determined in accordance with self assessment’.

Claims for 2008/09 or later years must be made within the normal four year time limit.