Yacht owners and their representatives can have a liability to pay social security contributions when crew members have a social security liability.
Irrespective of whether you own the vessel in your own name or through an offshore company, trust or limited liability partnership or foundation, you may have a liability to social security contributions and possibly other fiscal liabilities where you have or can be seen to have control of that structure.
If an authority establishes that a crew member has a social security liability it will then try to establish an employer’s liability particularly in respect of social security contributions. If an employer’s liability exists then the responsibility for payment of social contributions may well rest with you, the owner.
It is no longer enough to employ and administer crew directly and pay them through an offshore Payroll provider. Zebec, a truly offshore employer, is able to ensure compliance in all matters relating to crew employment under the Maritime Labour Convention, 2006.
Consequently yacht owners and their representatives need to know whether or not any crew member has a liability to pay social security contributions in any jurisdiction. If you use a Corporate Service Provider or a Managing Agent, please refer to those sections.
All of the following have to be considered by yacht owners and their representatives:
- The nationality/domicile and residence of the crew
- The flag state of the yacht
- The jurisdiction from where salaries are paid
- The structure from where the salaries are paid
- The residence of the yacht owner or owning structure
- The residence of the yacht owner’s representative or managing agent
- The permanent berth of the yacht