Key takeaways
- ✓SED can give 100% relief from UK income tax on seafaring earnings for employees who qualify. It does not cover National Insurance.
- ✓You need an "eligible period" of at least 365 days made up mainly of days outside the UK (outside the UK at midnight).
- ✓UK visits can count only if no single visit lasts 183 consecutive days or more and your UK days are not more than half the days in the period.
- ✓Duties must be performed on a ship on voyages that begin or end outside the UK. Offshore installations (platforms, FPSOs, drillships, flotels) do not qualify.
- ✓It is claimed through Self Assessment (or form R43M(SED) for EEA residents taxed under PAYE). Keep your discharge book, contracts and records of every trip.
Who can claim
- •Employees (not self-employed contractors) who perform all, or most, of their duties on a ship
- •UK residents — and non-UK residents who are tax resident in an EEA state
- •Royal Fleet Auxiliary crew can qualify; other Crown employees, such as Royal Navy sailors, cannot
- •Yacht crew on private and charter yachts can qualify if they meet the conditions — the yacht must be a ship, not an offshore installation
Self-employed delivery skippers and day workers invoicing their own clients are taxed differently. SED is for earnings from an employment.
The eligible period in plain language
An eligible period is a run of at least 365 days made up mainly of days absent from the UK. You count as absent on a day if you are outside the UK at midnight at the end of that day — non-working days abroad count too.
Days back in the UK can be included only if they fall between periods abroad, no single UK visit lasts 183 consecutive days or more, and the total UK days are not more than half the days from your first day abroad to the end of the last trip. HMRC's example: 183 days abroad followed by 182 days in the UK does not qualify, because the UK days are not between periods abroad.
Quick checks
| Situation | Likely to qualify? |
|---|---|
| Employed on a yacht cruising the Med and Caribbean, home visits of a few weeks | Often yes — check the half-the-days rule |
| Rotational 2:2 job with every leave period spent in the UK | Possibly — UK days must stay at or below half |
| A single UK stay of 183 days or more | No — the eligible period breaks and the count restarts |
| Working on an FPSO, drilling rig or flotel | No — offshore installations are excluded |
| Self-employed delivery skipper invoicing clients | No — SED is for employment income |
| Yacht based in the UK sailing only UK waters | No — voyages must begin or end outside the UK |
How to claim
- •Work out your eligible period(s) with the HS205 working sheet (dates you left and returned to the UK).
- •Enter the qualifying earnings in box 11 on page Ai 2 of the Additional information pages of your Self Assessment return.
- •List the names of the ships you worked on in the "Any other information" box of the SA100 return.
- •EEA residents taxed under UK PAYE reclaim with form R43M(SED).
- •Do not send your records — but keep them: HMRC may ask for them later.
Records to keep
- •Discharge book or Service Record Book and sign-on/sign-off dates
- •Employment contract (SEA), payslips and annual pay statements
- •Flight and boarding passes, passport stamps and crew lists — especially now that the EU uses digital entry/exit records
- •Your own log of every day in and out of the UK
A simple day-by-day calendar is the best defence in a tax enquiry. Many crew keep it alongside their sea-time logbook.
Frequently asked questions
Do yacht crew qualify for the Seafarers' Earnings Deduction?+
Yes, if they are employees, work on a ship (not an offshore installation) on voyages that begin or end outside the UK, are UK or EEA resident, and have an eligible period of at least 365 days.
What is the 183-day rule for SED?+
No single return visit to the UK may last 183 consecutive days or more. If it does, the eligible period ends and a new one starts after the visit.
Does SED cover National Insurance?+
No. SED is a deduction from income tax only. National Insurance has separate rules for seafarers.
How do I claim the Seafarers' Earnings Deduction?+
Through your Self Assessment tax return using the HS205 working sheet (box 11 on page Ai 2), or with form R43M(SED) if you are EEA resident and taxed under PAYE.
Can self-employed delivery crew claim SED?+
No. SED applies to earnings from an employment. Self-employed crew should get advice on their own tax position.
Sources
- HMRC — HS205 Seafarers' Earnings Deduction (2026)
- GOV.UK — Seafarers' Earnings Deduction: tax relief if you work on a ship
- TaxAssist — A guide to understanding the Seafarers' Earnings Deduction
- SuperyachtNews — HMRC's best kept secret
- Yacht crew salary guide (Maritime Delivery guide)
- MLC 2006 seafarer employment agreement (Maritime Delivery guide)
Put it to work