The training commitment begins on 1st October falling on or after the date on which you begin to operate under tonnage tax. Therefore if you begin to operate under tonnage tax on 1st October, your training commitment will begin on the same day.
If you begin to operate under tonnage tax on a date from 2nd October to 30th September, your training commitment will begin on the following 1st October.
You do not therefore need to have your first trainees in place or to pay PILOT in respect of periods before 1st October of tonnage tax training commitment year. However it is advisable that you prepare in good time to recruit trainees so that you have trainees in place from 1st October of that year.
We prefer tonnage tax companies/groups to train, or sponsor trainees, rather than make PILOT payments. It is recognised that situations may arise where some companies are unable to provide in-house training. The option to contract-out seafarer training should generally be open to them.
A proposal to pay PILOT rather than take on trainees will therefore normally only be accepted where a company can give good reasons why it is unable to provide training itself or arrange training elsewhere.
Companies that are unable to provide training themselves or arrange training elsewhere will need to explain in writing to us the practical reasons why they are proposing to fulfil their CTC through PILOT. We can then give this consideration.
It is accepted that not all companies will be able to develop all these recommendations. Reasons should be given if a particular option is impracticable for your company.
The length of training depends on the type of trainee. Cadets and undergraduates are tracked for 36 months, graduates are tracked for 24 months and conversion trainees are tracked for 12 months.
There may be occasions where a cadet may take more than 36 months to complete training. In these cases you should record the first 36 months from the date of commencement of their first certificate of competency (FCC) training.
Cadets who complete their FCC within 3 years may still be counted for a full 36 months to ensure uniformity of treatment.
The individual columns in Forms 5 and 6 are taken to refer to the 1st day of each month, so a trainee who starts on the 2nd day of a month should be recorded as having started from the following month.
Those trainees who were present on the 1st day of the month, but have subsequently resigned should still be shown as present for that month.
This is because the majority of trainees require three years or more to complete their FCC training.
No. If too much 'averaging' were permitted, for example, if any shortfall of Cadets in Period 2 was simply offset against any surplus in Period 1, the FCC output would tend to fall below the committed 1:15 ratio without the Maritime Training Trust receiving any PILOT to finance additional training.
Regulation 21 of the Tonnage Tax (Training Requirement) Regulations 2000 (SI 2000 No 2129) provides that a failure to meet half of the agreed CTC over a period of a year will trigger a surcharge of 50% on the level of PILOT payable throughout the following year, unless the Secretary of State is satisfied that there are mitigating circumstances for this failure.
Failure to meet at least half of the CTC over two or more successive years will result in a surcharge of 100% on the level of PILOT applying in the third and subsequent years, unless the Secretary of State is satisfied that there are mitigating circumstances for this failure.
There is no adjustment to be made to the CTC where vessels leave the fleet. This safeguards the level of training delivery set out in the CTC and keeps the EPA process reasonably simple.
However, if there is a significant reduction in the number of vessels entered in the tonnage tax during the course of a year (e.g. as a result of an acquisition or of a permanent withdrawal from a market sector), as an exceptional procedure, you may apply to the Secretary of State to agree a revised CTC for the balance of the year. This can be done in writing to the Shipping Policy team in DfT (see page 25 of the booklet Forms and Guidance on Completing the Forms for contact details).
Please note that you will need to inform us of the precise dates when the vessels in question left your fleet.
You would need to demonstrate to the Secretary of State that there were good reasons for evoking such a procedure, rather than reflecting the changed situation in the following year's CTC.
If any vessels are added to the fleet after your CTC has been approved, and are net additions to the fleet, you will need to complete Form 8 when sending in your EPA returns to take into consideration the additional vessel(s).
If you cease to operate qualifying ships, but wish to remain within the tonnage tax, you will need to confirm whether you will be relying on the temporary cessation rules in paragraph 17 of Schedule 22 to the Finance Act 2000 to remain in the tonnage tax, and if so, whether you have given notice to HMRC under that paragraph of your intention to resume operating qualifying ships and you wish to remain within tonnage tax.
Where a company relies on the temporary cessation rules to remain within tonnage tax the CTC would normally be set at the minimum level of 1.
Yes. But please let us know if you are awaiting our clearance before you copy your forms to the MTT.
Yes (except Form 4). You will need to send the original signed copy of Form 4 in order for your CTC to be approved.
You should inform the Department for Transport and submit a Form 8 at that stage.
You should promptly inform the Department for Transport and send revised Forms 5 (6 if there are Conversion trainees), 7 and 8 (if there are net additions to the fleet), for the period in question. After the forms are approved by the Department for Transport copies should be sent to the Maritime Training Trust who will inform you of any consequences this might have for PILOT payments you have already made.