Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Tonnage Tax Manual

HM Revenue & Customs
, see all updates

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 and 2007 are excepted years.

No years from Financial Year 2008 to Financial Year 2014 have been excepted years.  HMRC issue a press release annually to advise whether the next Financial Year is to be an excepted year.

For guidance on Member States’ registers see TTM03945.


FA00/SCH22/PARA22B TTM17131
FA00/SCH22/PARA22C TTM17136