Tax Incentives—Australian Shipping

There are a range of tax incentives available for Australian corporations with Australian registered eligible vessels. The incentives are designed to promote new investment in Australian shipping assets and operations. They are:

  1. An income tax exemption (ITE) for operators of Australian registered eligible vessels on qualifying shipping income;
  2. Accelerated Depreciation and rollover relief for owners of Australian registered eligible vessels;
  3. A refundable tax offset for employers who employ eligible Australian seafarers; and
  4. An exemption from royalty withholding tax for foreign owners of eligible vessels leased under a bareboat or demise charter to an Australian operator.

The process for gaining access to tax incentives is outlined in the diagram below. Read more specific detail regarding the Department's administration and how to apply for these tax incentives.

The tax concessions are claimed via a company tax return submitted in the usual way to the Australian Tax Office (ATO). Additional criteria are contained in the Tax Laws Amendment (Shipping Reform) Act 2012, administered by the ATO.

1. Applicant seeks in first year a notice establishing it will likely meet the qualifying conditions; 2. DIT assesses evidence—issue Notice if meet conditions; 3. Applicant required to obtain certificate from DIT at least 30 days before lodging tax return; 4. 
Certificate required annually which will include some reporting

  • A Notice is for current income year
  • A Certificate is for previous income year and may apply for part year
  • Certificates apply per applicant, per vessel, per income year

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Last Updated: 14 July, 2014