Dáil Éireann Debate, Thursday - 2 June 2022
211. Deputy Thomas Pringle asked the Minister for Finance if a person who works at sea in international waters for the majority of the year is liable to pay income tax to any state; if so, the state to which this tax will be paid; and if he will make a statement on the matter. [28595/22]
Amharc ar fhreagraI am informed by Revenue that it is not possible to provide a definitive answer to the question put by the Deputy in the absence of more specific information.
However, in general, the state where an international seafarer is liable to tax on income derived from the exercise of an employment on board a ship in international waters will depend on a number of different factors, including, but not restricted to the following:
- the domestic tax rules in the state of residence of the seafarer;
- the tax rules applying to the employment income of international seafarers in the state where:
- the employment is held and from where the employment income is paid
- the vessel is registered
- the vessel is managed.
In cases where the employment income of the international seafarer is subject to tax under the domestic tax rules of two jurisdictions, the terms of a double taxation agreement (DTA) concluded between these jurisdictions may apply to alleviate double taxation. In such instances, Article 15(3) of the OECD Model Tax Convention provides that two jurisdictions may agree that remuneration which is derived from an employment exercised aboard a ship operated in international traffic is taxable in the country in which the place of effective management of the operator of the ship is located.
For example, an international seafarer who is resident and domiciled for Irish tax purposes will be subject to Irish income tax on his/her worldwide income, including that derived from the exercise of an employment on board a ship in international waters. If the seafarer is subject to tax on this income in another jurisdiction with which the State has a DTA, then the income may be relieved from double taxation in accordance with the terms of the DTA.
