Do Seafarers and Cruise Ship Employees Have to Pay Income Tax

Yes and No.

First we will need to understand the categorization by in the income tax act for these two segments. If you are a seafarer or a cruise ship employee, the best plan of action would be to visit a great tax practitioner specialized in filing for seamen who spend most of their time outside Indian waters.

Who Is a Seafarer?

Rules stipulate that people who travel in vessels over international waters as an employee of the company that owns the ship or boat can belong to anyone of the below designations:

i) A seaman.

ii) A seafarer.

iii) A sailor.

iv) A mariner.

Do All Employees Travelling in Seas Fall Under This Section?

It should be noted that officers of the coast guard and Indian Navy are not included in this segment. Fishermen working in fishing vessels also do not qualify to be included in this category of seafarers. It is always better to look up the website of a qualified income tax advisor to understand these divisions.

Residency Status of a Seafarer

Mostly Indian citizens working in merchant ships or cruise ships are considered as seafarers by the income tax act. However, all of them do not have to pay tax. So we will need to understand how the residency status of a mariner is classified as resident or non-resident.

The residency status is calculated based on the number of days spend within the boundaries of India by a seafarer during the tax assessment year.

Non-Resident Seafarer

The person whose tax is being assessed should have spent at least 184 days in his or her capacity as an employee on a seagoing vessel or company outside the nation of India. The salary received by the non-resident seaman during the assessment year will not count towards the taxable income. 

Resident Seafarer

The seafarer, who spent only 183 or lesser days outside India, is a resident seafarer. The salaries of resident seafarers are counted for income tax.

Calculating the Periods of Stay Outside India

There are specific guidelines for calculating the time spent by a seafarer outside of India to classify them into the resident and non-resident categories. They are clearly outlined in a government Notification No. 70/2015/ F.No.142 /12/2015-TPL.

In order to avoid punishments and valuable time being spent to sort out the inadvertent mistakes in filing Form ITR-1 Sahaj, a seafarer or a cruise ship employee should always consult a tax professional. It is very easy to find a good company online. They will advice you on your resident status and will also file your returns in a perfect manner. 

Yes and No

The salaries of what all categories of seafarers and cruise ship employees are counted for income tax?

Resident seafarers – YES

Non-resident seafarers - NO

Drafted By:
CS.A.Maniraj.,B.Com.,ACS.,CA(Fin), Independent Director 
Certified CSR Professional., Certified GST Professional.