TTM05110 - The 75% limit on charters-in: Chartered-in

Charters not taken into account


Bareboat charters

A charter on 바카라 사이트˜bareboat charter terms바카라 사이트™ is defined (FA00/SCH22/PARA143) as meaning:

바카라 사이트˜a hiring of a ship for a stipulated period on terms which give the charterer possession and control of the ship, including the right to appoint her master and crew바카라 사이트™.

Another name for such a charter is 바카라 사이트˜charter by demise바카라 사이트™.  A lease of a ship to an operator is another form of charter by demise, a bareboat charter.

In practice, the term 바카라 사이트˜bareboat charter바카라 사이트™ is widely used and well understood in the shipping industry.  It is unlikely that the definition will cause problems in practice.

See TTM15110 for further background information.

Non-qualifying ship disregarded

A qualifying company may operate non-qualifying ships.  These might include:

  • a vessel on a long-term bareboat charter-out, or
  • a vessel specifically excluded from tonnage tax, for example a fishing vessel.

These ships should not be taken into account in arriving at the percentage.  If a vessel were operated normally for six months and then bareboat chartered-out (outside the tonnage tax regime) for the remaining six months, it should only be taken into account for the first six months of qualifying use.

Intra-group charters

Any vessel operated by more than one qualifying company in a tonnage tax group for the same days should only be counted once.  So where a ship is owned by one company and bareboat chartered to and operated by another company in the same tonnage tax group, only the owning company바카라 사이트™s interest should be used in the computation of the tonnage operated by the group (FA00/SCH22/PARA37 (3)).

A ship that is time-chartered from another tonnage tax company in the same group is not 바카라 사이트˜chartered-in바카라 사이트™ by that company for the purposes of applying the 75% test.  But a ship that is time chartered-in from a non-resident member of that group will be 바카라 사이트˜chartered-in바카라 사이트™.  The non-resident company will not be a qualifying company, as it is not within the charge to UK Corporation Tax (see TTM03001).

References

FA00/SCH22/PARA143 (bareboat charter terms) TTM17791
What is chartered-in TTM05100
Charters to be taken into account TTM05120