Revenue Note for Guidance

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Revenue Note for Guidance

CHAPTER 5

Tax treatment of certain payments to holders of sea-fishing boat licences

Summary

This scheme is to compensate fishers for decommissioning fishing vessels, pursuant to Regulation (EU) 2021/1755 in respect of a relevant vessel decommissioned during the period beginning on 1 January 2022 and ending on 31 December 2023. Chapter 5 of Part 23 of the Taxes Consolidation Act 1997 is intended to provide specific tax treatment for some of the income tax and corporation tax liabilities that normally arise on receipt of payments under the scheme.

669L Definitions (Chapter 5)

This section defines certain terms used in the Chapter:

“Brexit compensation sum” means sums arising to a licence holder made under the scheme in respect of a relevant vessel decommissioned during the period beginning on 1 January 2022 and ending on 31 December 2023, which may comprise one or more of the following:

  1. compensation for the destruction of a relevant vessel;
  2. a crew payment amount;
  3. the catch sum;
  4. compensation for the surrender of a sea-fishing boat licence;

“catch sum” means the portion of the Brexit compensation sum that is received in respect of the annual gross tonnage of sea-fish stock landed over the periods 1 January 2018 to 31 December 2018 and 1 January 2019 to 31 December 2019 as adjusted for the age of the relevant vessel, and which takes into account any amount previously paid to the licence holder as a temporary tie up payment;

“chargeable period” has the same meaning as in section 321(2);

“crew member” means an individual who has spent at least 90 days at sea on board a relevant vessel in each of the periods beginning on 1 January 2020 and ending on 31 December 2020 and 1 January 2021 and ending on 31 December 2021;

“crew payment amount” means the amount of the Brexit compensation sum received by a licence holder in respect of crew members;

“day at sea” has the same meaning as in Chapter I of the Annex to the Commission Delegated Decision (EU) 2021/1167 of 27 April 2021 establishing the multiannual Union programme for the collection and management of biological, environmental, technical and socioeconomic data in the fisheries and aquaculture sectors from 2022;

“decommissioned” means, in respect of a sea-fishing boat, a sea-fishing boat which has been removed from the Register of Fishing Boats;

“licence holder” means the holder of a sea-fishing boat licence in respect of a relevant vessel;

“Register of Fishing Boats” means the Register of Fishing Boats maintained under section 74 of the Sea-Fisheries and Maritime Jurisdiction Act 2006;

“Regulation (EU) 2021/1755” means Regulation (EU) 2021/1755 of the European Parliament and of the Council of 6 October 2021 establishing the Brexit Adjustment Reserve;

“relevant vessel” means a sea-fishing boat entered in the Register of Fishing Boats and used in the polyvalent and beam trawl segments of the fishing fleet which –

  1. has spent at least 90 days at sea –
    1. in each year in the 2 years preceding the year in which the sea-fishing boat is decommissioned, or
    2. in each year during both the periods 1 January 2018 to 31 December 2018 and 1 January 2019 to 31 December 2019,

    and
  2. was constructed at least 10 years before the date of decommissioning.

“sea-fishing boat licence” means a licence granted under the Fisheries (Amendment) Act 2003;

“sea-fish stocks” means the stocks of sea-fish set out in Annexes 35 and 36, to the Trade and Cooperation Agreement between the European Union and the European Atomic Energy Community, of the one part, and the United Kingdom of Great Britain and Northern Ireland of the other part;

“temporary tie up payment” means a payment made to a person to temporarily cease all fishing activities and to retain the relevant vessel in port for at least one month during either or both of the periods 1 January 2021 to 31 December 2021 and 1 January 2022 to 31 December 2022.

Relevant Date: Finance Act 2024