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HMRC internal manual

Tonnage Tax Manual

HM Revenue & Customs
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Qualifying companies and ships: Towage, salvage or other marine assistance


This category relates principally, but not exclusively, to tugs and Emergency Response and Rescue Vessels (ERRV’s). ‘Marine assistance’ should be read ejusdem generis with ‘towage’ and ‘salvage’.

  • Towage will be the towing of another ship, vessel or structure. This second ship or structure need not itself be qualifying as, for example, the towing of an oil-rig.
  • Salvage includes the rescue of a ship, its cargo or other property from loss at sea, including recovery of a sunken vessel. The profits from the sale of salvaged goods are taxable outside the ring fence.
  • Marine assistance may take many forms, such as anchor handling of rigs or standby duties for the towing of vessels in danger near ports. It is important to consider what the ship is used for.

Not all tugs will qualify under this heading. Since 1 July 2005 only tugs engaged for more than 50% of their operational time in towage, salvage and marine assistance at sea may qualify for tonnage tax. Thus tugs operating primarily in and around ports and harbours are no longer qualifying ships. In addition there is a requirement that to be within tonnage tax after 1 July 2005 tugs have to be registered in one of the EU Member States (see TTM03680 and TTM03685).


For examples see TTM03570.


FA00/SCH22/PARA19 (1)(c) (towage, salvage & other marine assistance) TTM17101
Qualifying ship TTM03500
Non qualifying ships - tugs TTM03680
Non qualifying ships, tugs, flagging TTM03685