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Tony Tax
Tony Tax, Tax Consultant
Category: UK Tax
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I am a UK resident, work offshore (meaning on ships around

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I am a UK resident, work offshore (meaning on ships around 200 days per annum) and currently work in Norwegian waters for less than 6 months a year. I am employed by my own limited company (UK). My agent is deducting 45% from my invoices as Norwegian witholding tax. This seems to high for me and my accountant has not been helpful. Any ideas how I can calculate what I should be having deducted and manage the tax payments myself from my UK ltd. company? My day rate is about £580 before deductions.

Is your company registered with the Norwegian government or tax authority? What is your job exactly? Who is your agent? What does he do for you?
Customer: replied 5 years ago.
Hi there

I am a hydrographic surveyor. I work on vessels doing such things as positioning pipelines on the seabed and tracking subsea construction projects. I am a freelancer who has set up their own UK limited company. My wife and I are 50/50 shareholders and my earnings are paid to us using both of our tax allowances. We are resident in the UK.

My job takes me on vessels for most of the year. These vessels can be anywhere in the world. In a given year I may work on projects in 3 or 4 countries/continents. Currently I am working on a project in Norwegian waters. Norway and Denmark have various tax requirements for working in their waters. Most countries are either tax exempt or you come under UK tax law.

My agent finds work for me/my company and bills the client, takes a small commission (or not so small) and then pays my company the day rate for the days I have worked offshore. The agent works for an agency (with a decent reputation in the industry) called Goss Consultants. However, I have found that the other freelancers on the vessel have said regardless of the flag of the vessel (this vessel has a Norwegian flag as well as working in Norwegian waters) the witholding taxes should amount to no more than about 30% of my day rate.

I have not worked in Norway as a freelancer before and have been on this vessel for 2 weeks (I am writing to you from the middle of the North Sea at the moment through a very slow satellite connection).

They have said to me that I should be able to opt out of Norwegian NI, Norwegian pension contributions and so long as I don't work in Norway for more than 6 months a year and work in different countries as well, my deductions should be a lot less than they are.

I have just gone freelance and am about to submit my first invoice. The difference in even a month's pay is about £4000 between a 30% and 45% deduction.

I am signed up to an accounting firm paying around £2000 per annum and they seem clueless on these issues. I am about to put a gun to their temple and give them an ultimatum.

So, from what I understand, my UK LTD needs to be able to pay tax to the Norwegian tax authority. As an offshore, non-resident worker I need to work out what my tax deduction should be, I need to work out how to register with paying it in Norway through my UK company (which is possible as others I work with do this and have done for years), I need to know whether I can demand that my agent pay me the full amount and I sort this out after the fact to ensure I don't lose any income and I need to do this in the next few days while bobbing around in a storm with limited internet and phone access.

Bear in mind, in many countries under tax laws that offshore workers tend to come under special conditions of some kind or another.

Your help is appreciated.


Thanks for the comprehensive reply.

I've done some research already and I need to do some more. It's late now so leave this with me until Saturday and I'll get back to you. From what I've read so far you should not be having anywhere near 45% WT deducted, if any.
Customer: replied 5 years ago.
Thanks and sleep well. I work from 6pm to 6am Norwegian time. (UK+1). So, look forwards to hearing from you tomorrow.
Hi again.

First off, let me direct you here.

I cannot definitively tell you what you need to do to have your withholding tax reduced so I will be happy to opt out if at the end of this you consider that you are no further forward. If I opt out, another expert can take a look at your question though I'd be surprised if anybody else will be able to take you any further forward. We predominantly provided UK tax advice on this site.

It would appear that you need to register your company with the Norwegian government since you are working in their waters, albeit not permanently, and the links to the relevant forms are in the document I directed you to. How that will impact on your tax situation I cannot say. Your company will pay corporation tax in the UK and credit will be given against your UK CT liability for any tax paid in Norway by the company.

There are several recommendations I would make:

1 Find out from your colleagues on your vessel what they did to minimise their Norwegian tax deductions and do the same.

2 Appoint an accountancy firm with international tax experience.

3 Talk to Goss about your options and ask them what compliance procedures you need to go through to minimise the withholding tax deductions. They must have placed others in Norwegian ships and, given their apparent good reputation, they really should have given you chapter and verse when they took you on as a client.

4 You should call the UK tax office and ask them to write a letter confirming that you and your company are UK resident for income tax and corporation tax purposes respectively.

5 You might get some advice from here or here but I'd get what information and advice you can from your colleagues and Goss before you go elsewhere. Other British workers on your ship should be able to recommend tax and accountancy services.

Let me know if you have any further queries.
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