Income Tax (Earnings and Pensions) Act 2003 section 379

Calculating the deduction

Section 379 explains how to calculate the amount of the seafarer's earnings deduction that an eligible seafarer may claim under section 378.

• The deduction is applied to the earnings from the employment that are attributable to the eligible period, and the amount of the deduction equals those earnings — effectively reducing the taxable earnings for that period to nil.
• Earnings received for a period of leave taken immediately after the eligible period can also be treated as attributable to the eligible period, but only to the extent that they fall within the same tax year in which the eligible period ends.
• This means leave pay cannot be shifted from one tax year into another solely to benefit from the deduction.
• The deduction calculated under this section is subject to the limit in section 380, which may restrict it where UK duties or other factors make the full amount unreasonable.