Qualifying companies and ships: Flagging - excepted years
FA00/SCH22/PARA22B (2) and FA00/SCH22/PARA22C
The test for whether or not the overall proportion of ships in tonnage tax registered in member states has increased or not is based upon the average over a rolling three year period. HMRC calculate the proportion based upon the gross registered tonnage of ships in tonnage tax at 1 October, based upon returns made to the Department for Transport.
If the proportion has not decreased on average over a three year period, then the Treasury may make an order so that a Financial Year is an ‘excepted’ year.
Where an order is made, the detailed legislation at FA00/Sch22/Para22A does not apply and when an individual company or group starts to operate a new vessel then where that ship is registered does not affect whether or not it is a qualifying vessel for tonnage tax purposes.
The financial years 2005, 2006, 2007 and 2018 are excepted years.
For guidance on Member States’ registers see TTM03945.