HMRC have announced details of a tailor-made scheme designed to encourage share fishermen to ensure they put aside enough money to pay their tax bill when it becomes due.
Share fishermen, who are classified self-employed by HMRC, usually receive a share of the profits or gross earnings of a fishing boat. They are traditionally paid by cheque and/or cash for every catch without any deductions.
The Share Fisherman Scheme enables members set aside 20% of money earned each month from every catch, helping them to pay tax and national insurance on time and automatically at the end of the tax year.
Share fishermen earning more than £18,000 per annum should ensure that they are paying the right percentage of tax, which may be higher than 20 per cent.
Joining the scheme is simple - Broadly, a bank account is opened in the share fisherman's name and the boat owner pays a slice of share fishermen's earnings into the account each month. A direct debit is also set up with HMRC, so that the tax can be paid over accordingly at the relevant time.
As part of the scheme, share fishermen can also get tax relief on sea kit expenses, currently set at £700 a year. The expenses are for fishing wear and gear, and cover protective clothing, oil-skins, boots, gloves, stones and bedding. Fishermen can only claim the £700 if they have paid for the sea kit themselves.
Ron McGruther, HMRC share fishermen tax manager, said:
"We don't want to have to issue share fishermen with penalties for late and incorrect tax returns. This is why we have set up this tailor-made scheme.
"Besides this, the scheme will make it easier for share fishermen to access other benefits, including: tax credits, if they are on a low income; and other financial services, such as, loans and mortgages."
An information pack is available from HMRC about how to join the scheme. Call 0845 0789 789, or 01779 483 314.
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