The UK tonnage tax regime

The UK tonnage tax regime provides an alternative way of calculating taxable profits of companies operating qualifying ships that are strategically and commercially managed in the UK. The tonnage tax system was introduced in 2000 to create a positive fiscal environment for international shipping based in the UK.

However, the UK system aims to achieve a real and permanent reduction in the tax liability of participating businesses. This is in contrast to the tonnage tax systems of some other countries, where there is simply a deferral of tax until a business leaves the system.

There is no requirement for a tonnage tax company to be incorporated under UK law. A foreign company can enter tonnage tax provided that it is "within the charge to corporation tax", which it will be if it satisfies the ordinary UK legal tests for corporate residence.

A company wishing to enter and remain within the tonnage tax regime will need to commit to provide officer training places in proportion to the number of officers employed by the company on its qualifying ships.

See the following for further advice:

www.ukshipregister.co.uk
www.moorestephens.co.uk/TonnageTax.pdf
www.wfw.com/Legislation.pdf

The UK Ship Register is one of the best performing customer focused flags in the major Port State Control regimes and has a reputation for maintaining the highest international standards.

• The 'UK Flag' is the best performing Flag on the Paris MoU 'White List'
• Dedicated customer service - focused assistance throughout and after registration
• Registration costs amongst the lowest available with no annual renewal fees
• Annual £1.4 million contribution to Crew Relief Cost Scheme to assist with seafarers' air travel costs
• UK registered ships are not targeted by Port State Control regimes in the world's major trading areas
• ISPS plan approvals and verification audits at no cost to owners and operators
• An international reputation for expert advice and guidance with a proactive leading role at the IMO, EU and Quality Shipping Committees
• Worldwide security threat level information provided to UK registered ships with support from British Consuls and Royal Navy protection
• Quality Assurance offering certification to ISO 9001 and ISO 14001 standards with audits being taken in harmonisation with ISM
• Alternate Compliance Scheme: A voluntary scheme that streamlines the survey and certification process by minimising duplication of effort with classification societies.