SED Guidance Hub

Seafarers’ Earnings Deduction (SED) is a deduction from your UK income tax. If you meet HMRC’s conditions, it can reduce the tax payable on your qualifying seafaring earnings to zero. To qualify you must work on a ship, carry out your duties outside the UK in a period that lasts at least 365 days, and your employment must include at least one voyage (or part voyage) that begins or ends at a foreign port in each tax year.

An eligible period is mainly made up of days when you are outside the UK at midnight. You may return to the UK during this period, but no single return visit can last more than 183 consecutive days and the total number of UK days must always remain less than half of the total days since your first day abroad (this is known as the half‑day rule).

Seadays helps you track days abroad versus UK days, watch for half‑day breaches and UK‑visit limits, and export an HS205 working sheet for your records or accountant.

Sources: GOV.UK — HS205 helpsheet · GOV.UK — SED guidance · HMRC Employment Income Manual

The 3 Key Rules

Source: HS205 working sheet. You can generate your own using our free HS205 generator.

Who qualifies:

• Employed on a ship: duties are performed on a vessel regarded as a "ship" (offshore installations like fixed platforms / drilling units do not qualify).
• Foreign-port voyage each tax year (per employment): at least one voyage (or part) begins or ends at a foreign port; certain non-UK offshore installations can count as a foreign port for this test.
• Residency: focused on UK/EEA residents employed as seafarers; Crown employees are excluded.

Who does not qualify:

• Crown employees: including Royal Navy sailors (except Royal Fleet Auxiliary employees who may qualify if all other conditions are met).
• Non-UK/EEA residents: must be resident in the UK or an EEA state (excluding the UK) for tax purposes.
• Offshore installations: work on fixed platforms, FPSOs, drilling units, or other installations not regarded as ships.
• Non-seafaring duties: work that is not performed on a qualifying ship or is not incidental to seafaring employment.

Any work ashore must be incidental to your onboard duties. A voyage solely between UK ports does not meet the foreign‑port requirement. North Sea installations within UK waters are treated as being in the UK.

Sources: GOV.UK — SED guidance · HS205 helpsheet · HMRC Employment Income Manual

1. Start your period on the day you leave the UK and are outside the UK at midnight that night. The day of departure counts as a day abroad; the day you return does not (since you will be back in the UK at midnight on your return day).
   Tip: Unsure if your position counts as "outside the UK"? Use our 12NM Limit Checker to verify your coordinates against the UK territorial sea limit.
2. Keep adding trips abroad and return visits. After every return to the UK, check two things: (a) no single UK visit has lasted visit, check two things: (a) no single UK visit has lasted more than 183 consecutive days; and (b) your cumulative UK days since the period began do not exceed half of the total days (the half‑day rule).
3. Your eligible period ends on the first return that breaches either of the above conditions. If a breach occurs, the eligible period ends on the previous return date and you must start a new eligible period from your next departure.

Seadays mirrors the HS205 working sheet to show your running totals and warns if a planned UK stay could break the chain.

Source: HS205 helpsheet.

• Completed HS205 working sheet.
• Passports/visas; flight and travel documents.
• Discharge book, freeboard logs, vessel details.
• Accommodation/receipts and relevant correspondence.
• Employment contract / SEA and payslips.

Store these in Seadays alongside your voyage/trip dates so your accountant has everything to hand at year-end.

Source: GOV.UK — Records you should keep.

The HS205 working sheet is the official HMRC form used to calculate your eligible period. You can fill it in manually or use our free HS205 generator to do it for you.

Key Columns to Watch

1. Review the rules: read through this guidance and the HS205 helpsheet to ensure you understand the 365‑day period, half‑day rule, foreign‑port requirement and definitions of a ship versus an offshore installation.
2. Track your days: sign up for Seadays to record your days abroad and UK days, attach voyage details and supporting documents, and watch for potential half‑day or UK‑visit breaches.
3. Gather evidence: keep passport stamps, travel tickets, discharge book entries, contracts and payslips. Seadays lets you store scans or photos alongside your voyages.
4. Generate the HS205 worksheet: once your eligible period is complete, use our free HS205 generator to export the HS205 working table or complete the form manually from the HMRC helpsheet. Provide this to your accountant or include it with your Self Assessment or R43M(SED) claim.
5. File your claim: this is a good point to speak to a specialist accountant or tax adviser who can help interpret your particular situation and handle your SED claim. Most accountants will prepare and file your Self Assessment return (SA101 for UK residents) or R43M(SED) form (for EEA residents) for you. After your first successful claim, they can also help you apply for an NT tax code to stop PAYE deductions. Remember that SED only covers your seafaring employment income; other earnings remain taxable. If you prefer to handle it yourself, UK residents file via Self Assessment using SA101; EEA residents use form R43M(SED). Always keep detailed records as HMRC can enquire at any time.

A good adviser can make all the difference when claiming SED. Consider the following when selecting someone to work with:

• Specialisation and experience: ask how many seafarers’ claims they prepare each year and whether they are familiar with the 365‑day period and half‑day rule nuances.
• Professional accreditation: look for membership of recognised bodies such as ICAEW, ACCA or the Chartered Institute of Taxation. These organisations regulate their members and require ongoing training.
• Recommendations: seek word‑of‑mouth referrals from fellow seafarers, employers or unions. Online forums and social media groups can also be useful.
• Transparent fees and services: a reputable accountant will provide an engagement letter detailing services, fees and responsibilities. Clarify whether they will assist with your Self Assessment, R43M(SED) form and NT code application.
• Communication and availability: because seafarers may be away for long periods, ensure your adviser is comfortable working digitally (email, secure portals, video calls) and can accommodate different time zones.
• Regulation and insurance: verify that the firm is supervised under the Money Laundering Regulations and holds professional indemnity insurance.
• Watch out for red flags: avoid anyone promising guaranteed eligibility without reviewing your circumstances or charging unusually high or low fees without explanation.

Seadays plans to curate a directory of trusted advisers with experience in seafarer taxation. Until then, use the above checklist and always engage a professional who understands HMRC’s latest rules and your unique circumstances.

Given the complexity of SED rules and HMRC requirements, we strongly recommend engaging a specialist accountant or tax adviser who has experience with seafarer taxation. They can guide you through the claiming process, ensure your calculations are correct, and handle communications with HMRC. If you're confident in your understanding and have straightforward circumstances, you can proceed with self-assessment.

1. If you are resident in the UK: register for Self Assessment and include your completed HS205 working sheet. Enter the deduction in box 11 of the Additional information pages (SA101).
2. If you are resident in an EEA state (other than the UK): you generally claim SED using form R43M(SED) rather than via Self Assessment. Follow any instructions from HMRC if you also need to file a Self Assessment return.
3. Include only earnings from seafaring employment during your eligible period. Deduct pension contributions and allowable expenses where permitted.
4. After your first successful claim you may ask HMRC to operate an NT tax code so your employer does not deduct PAYE tax. You must still file a Self Assessment return each year and meet the conditions (for example, having a 12‑month contract or at least six months of continuous employment).

Keep your evidence: HMRC can enquire at any time. Seek professional advice if you are unsure about interactions with student loans, pensions or other reliefs.

Sources: GOV.UK — How to claim · HS205 helpsheet

The Seafarers' Earnings Deduction is set out in UK tax law. The key statutory provisions and guidance are listed below so you can explore the rules in detail. These references underpin the guidance on this page and the logic used by Seadays to track eligibility.

• Income Tax (Earnings and Pensions) Act 2003 —Section 378 describes the conditions for claiming a deduction from the earnings of seafarers employed on ships, including the need for a qualifying period and a foreign-port voyage.Section 383 defines a combined period of absence and explains the half-day rule and the 183-day return-visit limit.Section 385 confirms that the deduction applies only to earnings from seafaring employment.
• Income Tax Act 2007 — Section 1001 provides the statutory definition of an offshore installation, making clear that fixed production platforms, floating storage units and drill ships are not treated as ships for SED.
• HMRC Employment Income Manual (EIM33000 onwards)— the EIM manual contains detailed commentary on eligibility, including the requirement for a foreign-port voyage in each employment, the extension to residents of other EEA states and practical examples of the half-day rule and midnight test. See EIM33001 (overview).
• HS205 Seafarers' Earnings Deduction helpsheet— this helpsheet accompanies the Self Assessment tax return. It contains the working table used by Seadays to calculate your running totals and gives examples of how to complete the 365-day period and apply the half-day rule. Available at GOV.UK.
• Other guidance — The GOV.UK page "Seafarers' earnings deduction: tax relief if you work on a ship" summarises the main rules and links to associated forms (HS205, R43M(SED) and SA101). National Insurance guidance for seafarers can be found in the National Insurance Manual (NIM33000 series).

FAQs

Always refer to HS205 and GOV.UK guidance.