Your Questions Answered: Is my ship income employed or self-employed in my tax return?

Courtney has been in touch with a great question that we get from a lot of you:

I worked on a ship for 3 months in the 2018-2019 tax year. I’m doing my very first self-assessment and the majority of my work is self-employed. Do I list the ship earnings as employed earnings, or do I just lump them in with the rest of my self-employed earnings? I thought I needed to do it as employed but the questions seem really tricky - thanks so much in advance!

Employed or self-employed?

Courtney told us that she received a P45 from her employer, which is a sure sign that she was employed during her ship contract. However, you'll only get a P45 or P60 from UK-based employers. If you have been taxed, this means you are employed as well as only employers will tax you.

Whether you are doing a contract for a UK-based cruise company or not, you are likely to be employed if you are doing a multi-month dancer/singer contract (especially if they refer to you as 'staff' or 'crew' or similar). If you are described as a 'guest enterntainer' or similar, then you will be self-employed for this work.

To make it a bit simpler, here is a summary of indicators that you are employed:

  1. Your contract refers to you as being employed;
  2. You have a multimonth continuous contract;
  3. You are referred to as staff/crew;
  4. You are taxed and/or receive a P45/P60; and/or
  5. You receive payslips on a regular basis (i.e. weekly, biweekly, monthly).

Indicators that you are self-employed:

  1. You have a short/non-continuous contract;
  2. You are referred to as a 'guest entertainer/performer/singer' etc;
  3. You have to invoice to be paid; and/or
  4. You are responsible for your own transport to the port (even if you can claim this back from the employer).

As is always the case with employed/self-employed, it can always be a little unclear (there have literally been legal battles over this). But if you are pretty exclusively from one of the above lists or the other, then this should be your answer.

Great question, Courtney! Let us know if you have one using our free contact form and maybe you can be the star of next week's Your Questions Answered!

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Love Jo and James x