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HMRC internal manual

Double Taxation Relief Manual

Double Taxation Relief Manual: Guidance by country: Denmark: Seamen

Remuneration derived by a United Kingdom resident from employment aboard a ship operated by a shipping company which is a resident of Denmark is taxable only in Denmark provided that the income is actually ‘subject to tax’ (see INTM162020) in Denmark Under a provision of Danish law which came into effect on 1 January 1989, seamen became exempt from Danish tax if they were employed on a Danish ship on the Danish International Shipping Register. At the time the legislation was introduced, the seamen’s remuneration was, however, reduced to a ‘net salary’ or ‘net amount’ of about half the salary that would have been payable had the remuneration remained taxable in Denmark. Although these individuals do not therefore actually pay Danish tax, Article VII of the second amending agreement provides that remuneration derived aboard a ship which is registered in the Danish International Shipping Register is deemed nevertheless to be subject to tax in Denmark so that the remuneration will not be chargeable to tax in the United Kingdom. This provision in the agreement has retrospective effect to 1 January 1989, the date on which the Danish legislation was introduced.