The Social Security (Contributions) Regulations 2001

Case C— U.K. Mariners

Interpretation U.K.

115.  In this Case—

• “British ship” means—

  (a)

  any ship or vessel belonging to Her Majesty; or

  (b)

  any ship or vessel whose port of registry is a port in the United Kingdom; or

  (c)

  a hovercraft which is registered in the United Kingdom;

• “foreign-going ship” means any ship or vessel which is not a home-trade ship;

• “home-trade ship” includes—

  (a)

  every ship or vessel employed in trading or going within the following limits, that is to say, the United Kingdom (including for this purpose the Republic of Ireland), the Channel Islands, the Isle of Man, and the continent of Europe between the river Elbe and Brest inclusive;

  (b)

  every fishing vessel not proceeding beyond the following limits—

  • on the South, Latitude 48°30iN.,

  • on the West, Longitude 12°W., and

  • on the North, Latitude 61°N.;

• “managing owner” means the owner of any ship or vessel who, where there is more than one such owner, is responsible for the control and management of that ship or vessel;

• “mariner” means a person who is or has been in employment under a contract of service either as a master or member of the crew of any ship or vessel, or in any other capacity on board any ship or vessel where—

  (c)

  the employment in that other capacity is for the purposes of that ship or vessel or her crew or any passengers or cargo or mails carried by the ship or vessel; and

  (d)

  the contract is entered into in the United Kingdom with a view to its performance (in whole or in part) while the ship or vessel is on her voyage;

  but does not include a person in so far as his employment is as a serving member of the forces;

• “owner” in relation to any ship or vessel, means the person to whom the ship or vessel belongs and who, subject to the right of control of the captain or master of the ship or vessel (“the master’s rights”), is entitled to control of that ship or vessel, and references to the owner of a ship or vessel shall, in relation to a ship or vessel which has been demised, be construed as referring to the person who for the time being is entitled as charterer to possession and, subject to the master’s rights, to control of the ship or vessel by virtue of the demise or any sub-demise;

• “passenger” means any person carried on a ship except—

  (a)

  a person employed or engaged in any capacity on board the ship on the business of the ship; or

  (b)

  a person on board the ship either in pursuance of the obligation to carry shipwrecked, distressed or other persons, or by reason of any circumstance that neither the master nor the owner nor the charterer (if any) could have prevented or forestalled;

• “pay period” in relation to any payment of a mariner’s earnings means the period in respect of which the payment is made;

• “radio officer” means a mariner employed in connection with the radio apparatus of any ship or vessel and holding a certificate of competence in radio telephony granted by the Secretary of State or by an authority empowered in that behalf by the legislature of some part of the Commonwealth or of the Republic of Ireland and recognised by the Secretary of State as equivalent to the like certificate granted by him;

• “share fisherman” means any person who—

  (a)

  is ordinarily employed in the fishing industry, otherwise than under a contract of service as the master or a member of the crew of any United Kingdom fishing vessel within the meaning of section 1(3) of the Merchant Shipping Act 1995 F1 , manned by more than one person, and who is remunerated in respect of that employment in whole or in part by a share of the profits or gross earnings of the fishing vessel, or

  (b)

  has ordinarily been so employed, but who by reason of age or infirmity permanently ceases to be so employed and becomes ordinarily engaged in employment ashore in the United Kingdom, otherwise than under a contract of service, making or mending any gear appurtenant to a United Kingdom fishing vessel or performing other services ancillary to or in connection with that vessel and is remunerated in respect of that employment in whole or in part by a share of the profits or gross earnings of that vessel and has not ceased to be ordinarily engaged in such employment;

• “ship or vessel” for the purposes of this Case other than those of regulations 116 to 120 includes hovercraft;

• “voyage period” means a pay period comprising an entire voyage or series of voyages (including any period of leave on pay which immediately follows the day on which the termination of that voyage or series of voyages occurs);

• “week” means a period of 7 consecutive days and “weekly” shall be construed accordingly.

Textual Amendments

F1 1995 c. 21.

Modification of section 162(5) of the Administration Act U.K.

116.  In section 162 of the Administration Act (destination of contributions), subsection (5) F2 (which specifies the amount of the national health service allocation to be deducted from each class of contribution prior to their payment into the National Insurance Fund) shall be modified, in the case of contributions paid at the rate reduced in accordance with regulation 119(1), as if, instead of the percentage figure specified in paragraph (b) of that subsection, there were specified the percentage figure “0.6”.

Textual Amendments

F2 Subsection (5) was amended by section 2(1) of the Social Security (Contributions) Act 1994 (c. 1), section 65(2) of, and paragraph 99(3) of Schedule 7 to, the Social Security Act 1998 (c. 14), paragraph 9(2) of Part III of Schedule 9 to the Welfare Reform Act and section 74(7) of the Child Support, Pensions and Social Security Act (c. 19).

Conditions of domicile or residence U.K.

117.—(1) As respects any employment of a person as a mariner and liability for payment of any contribution under the Act as an employed earner by or on behalf, or in respect, of that mariner in respect of that employment—

(a) the provisions of Case F of these Regulations relating to conditions as to residence or presence in Great Britain or Northern Ireland (as the case requires) shall not apply; but

(b) it shall be a condition of liability to pay a contribution under the Act that the mariner is domiciled or resident in Great Britain or Northern Ireland (as the case requires); and

(c) it shall be a condition of liability to pay a secondary contribution under the Act that the secondary contributor is resident or has a place of business in Great Britain of Northeern Irelad (as the case requires).

This is subject to the following qualification.

(2) This regulation has effect subject to any Order in Council giving effect to any reciprocal agreement made under section 179 of the Administration Act (reciprocal agreements with countries outside the United Kingdom).

Modification of employed earner’s employment U.K.

118.  Where a mariner—

(a) is employed as such and—

(i) the employment is on board a British ship, or

(ii) the employment is on board a ship and the contract in respect of the employment is entered into in the United Kingdom with a view to its performance (in whole or in part) while the ship or vessel is on her voyage, and

(iii) in a case to which sub-paragraph (ii) applies, the person by whom the mariner’s earnings are paid, or, in the case of employment as a master or member of the crew of a ship or vessel, either that person or the owner of the ship or vessel (or the managing owner if there is more than one owner) has a place of business in Great Britain or Northern Ireland (as the case requires); or

(b) is employed as a master, member of the crew or as a radio officer on board any ship or vessel, not being a mariner to whom paragraph (a) applies, and—

(i) in the case of employment as a radio officer, if the contract under which the employment is performed is entered into in the United Kingdom, the employer or the person paying the radio officer his earnings for that employment has a place of business in Great Britain or Northern Ireland (as the case requires), or

(ii) in the case of the employment being a master, member of the crew or as a radio officer, if the contract is not entered into in the United Kingdom, the employer or the person paying the earnings has his principal place of business in Great Britain or Northern Ireland (as the case requires),

then, notwithstanding that he does not fulfil the conditions of section 2(1)(a) of the Act (definition of employed earner), the employment of the mariner as mentioned above shall be treated as employed earner’s employment.

Modification of section 9(2) of the Act U.K.

119.—(1) As respects earnings paid to or for the benefit of a mariner for employment as such in any employment specified in paragraph (2), being employment which by virtue of regulation 118 is treated as employed earner’s employment, from the figure specified as the secondary percentage in section 9(2) of the Act F3 there shall be subtracted 0.5 per cent and section 9 of the Act shall be modified accordingly.

(2) The employment referred to in paragraph (1) is employment as a master or member of the crew of a ship where—

(a) the employment is on a foreign-going ship and the payment of earnings is exclusively in respect of that employment; or

(b) the employment is partly on a foreign-going ship and partly otherwise than on such a ship and the payment of earnings in respect of that employment is made during the employment on the foreign-going ship.

(3) In this regulation the word “employment” includes any period of leave, other than leave for the purpose of study, accruing from the employment.

Textual Amendments

F3 Section 9 was substituted by paragraph 5 of Part I of Schedule 9 to the Welfare Reform Act.

Earnings periods for mariners and apportionment of earnings U.K.

120.—(1) For the purposes of liability for and calculation of earnings-related contributions, paragraphs (2) to (9) apply where earnings are paid to or for the benefit of a mariner in respect of his employment as such for a voyage period.

(2) In this regulation “a relevant change” means a change affecting the calculation of earnings-related contributions under the Act not being—

(a) a change in the amount of the mariner’s earnings; or

(b) a change in one or more of the following figures applicable in respect of the mariner’s employment—

(i) [F4 the main primary percentage or the additional primary percentage] for a primary Class 1 contribution specified in section 8(2) of the Act F5 or the percentage rate for a secondary Class 1 contribution specified in section 9(2) of the Act,

F6 (ii) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iii) the amount by which the percentage rate of a secondary Class 1 contribution is reduced in accordance with regulation 119(1),

(iv) the lower or upper earnings limit for primary Class 1 contributions specified in section 5(1) of the Act F7 .

(3) Where a voyage period falls wholly in one year, then—

(a) if no relevant change occurs during the voyage period, the earnings period shall be the voyage period;

(b) if one or more than one relevant change occurs during the voyage period the earnings shall be apportioned to such periods as comprise—

(i) the day on which the voyage period began and the day immediately before which the change occurred, and for any subsequent change, the day on which the immediately preceding change occurred and the day before which the next succeeding change occurred, and

(ii) so much of the voyage period as remains,

according to the amounts earned in each period, and the earnings period in respect of each amount so apportioned shall be the length of the period to which it is apportioned.

(4) Where a voyage period falls partly in one or more other years, then if no relevant change occurs during the voyage period—

(a) the earnings shall be apportioned to those years according to the amounts earned in each year; and

(b) the earnings period in respect of each amount shall be the length of the period to which that amount is apportioned.

(5) Where a voyage period falls partly in one and partly in one or more other years and one or more than one relevant change occurs during the voyage period, then—

(a) in respect of a year during which a relevant change or more than one relevant change occurs the earnings shall be apportioned to such periods as comprise—

(i) the day on which the voyage period began, or where it began in another year, the beginning of the year in which the change occurred, and the day immediately before which the change occurred, and for any subsequence change, the day on which the immediately preceding change occurred and the day before which the next succeeding change occurred, and

(ii) so much of the voyage period as remains in the year,

according to the amounts earned in each period, and the earnings period in respect of each amount so apportioned shall be the length of the period to which it is apportioned; and

(b) in respect of other years, the earnings shall be apportioned to those years according to the amounts earned in each year and the earnings period in respect of each amount so apportioned shall be the length of the period to which it is apportioned.

(6) Where under paragraphs (3) to (5) an earnings period—

(a) is less than a week, that period shall for the purposes of those paragraphs be treated as a week;

(b) exceeds a week or a whole multiple of a week by a part of a week,

(i) if that part of a week is a period in excess of 3 days, that part of a week shall be treated as a week for the purposes of paragraphs (3) to (5), and

(ii) if that part of a week is a period of 3 days or less, it shall be disregarded for those purposes.

(7) For the purposes of paragraphs (3) to (5)—

(a) where a period of leave on pay immediately follows the day on which the termination of an entire voyage or series of voyages occurs—

(i) the earnings for that period of leave shall be treated as if they were earned during that period and shall be excluded from the earnings for any other period or periods, and

(ii) for the purpose of apportionment, the earnings for the period of leave shall be deemed to accrue from day to day by equal daily amounts; and

(b) “earned” includes treated as earned under this paragraph.

(8) Where under paragraphs (1) to (7) earnings are apportioned to a period—

(a) each amount so apportioned shall be treated as paid at the end of the period to which it is apportioned; and

(b) contributions paid in respect of the amount so apportioned shall be treated as paid in respect of the year in which the end of that period falls.

(9) Notwithstanding paragraphs (3) to (5) and (8), where a voyage period extends beyond the date on which the earnings are paid, any amount of earnings which, by virtue of paragraphs (1) to (8), would be apportioned to a period in the year following that in which the earnings are paid—

(a) shall be treated as paid at the end of the year in which the earnings are paid but shall not be aggregated with any other amount of earnings paid or treated as paid at the end of that year; and

(b) the earnings period in respect of that amount shall be a period of the same length as that to which it is apportioned.

Textual Amendments

F4 Words in reg. 120(2)(b)(i) substituted (6.4.2003) by The Social Security (Contributions) (Amendment No. 2) Regulations 2003 (S.I. 2003/964), regs. 1, 4

F5 Section 8 was substituted by paragraph 4 of Part I of Schedule 9 to the Welfare Reform Act.

F6 Reg. 120(2)(b)(ii) omitted (6.4.2016) by virtue of The Social Security (Contributions) (Amendment) (No. 2) Regulations 2016 (S.I. 2016/352), regs. 1, 16 (with reg. 20)

F7 Section 5 was substituted by paragraph 1 of Part I of Schedule 9 to the Welfare Reform Act.

Calculation of earnings-related contributions for mariners U.K.

121.—(1) For the purpose of the calculation of earnings-related contributions payable in respect of earnings paid to or for the benefit of a person in respect of that person’s employment as a mariner—

(a) regulation 12(1) shall apply, save that in the case of a contribution payable on earnings above the upper earnings limit or the prescribed equivalent of that limit, the appropriate contributions calculator prepared by the Board may be applied;

(b) in the alternative, paragraphs (2), (3) or (4) and (5) of that regulation shall, except in relation to secondary Class 1 contributions payable at a rate reduced in accordance with regulation 119, apply in respect of those earnings.

(2) Subject to paragraphs (3), (4) and (5) of regulation 12 where the secondary Class 1 contribution is payable at a rate reduced in accordance with regulation 119, that contribution may be calculated in accordance with the scale prepared by the Board appropriate to that rate or, in the case of such a contribution payable on earnings above the upper limit or the prescribed equivalent of that limit, a contributions calculator appropriate to that rate, prepared by the Board.

Prescribed secondary contributors U.K.

122.  In relation to any payment of earnings to or for the benefit of a mariner in respect of employment to which the provisions of regulation 118 apply, where the person employing the mariner does not satisfy the conditions specified in regulation 117(1)(c), but the person who pays the mariner those earnings does satisfy either of those conditions, that person shall be treated as the secondary contributor, whether or not he makes the payment as agent for the employer.

Payments to be disregarded U.K.

F8 123.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 Reg. 123 omitted (6.4.2012) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2012 (S.I. 2012/817), regs. 1(1), 7(2)

Application of the Act and regulations U.K.

124.—(1) Part I of the Act and so much of Part VI of the Act as relates to contributions and the regulations made under those provisions shall, insofar as they are not inconsistent with the provisions of this Case, apply to mariners with the modification set out in paragraph (2).

(2) The modification is that, where a mariner is, on account of his being at sea or outside Great Britain or Northern Ireland (as the case requires) by reason of his employment as a mariner, unable to perform an act required to be done either immediately or on the happening of a certain event or within a specified time, he shall be deemed to have complied with that requirement if he performs the act as soon as is reasonably practicable, although after the happening of the event or the expiration of the specified time.

Modification in relation to share fishermen of Part I of the Act and so much of Part VI of the Act as relates to contributions U.K.

125.  Part I of the Act and so much of Part VI of the Act as relates to contributions shall apply to share fishermen with the modification that—

(a) employment as a share fisherman shall be employment as a self-employed earner notwithstanding that it is not employment in the United Kingdom;

(b) as respects liability of a share fishermen to pay Class 2 contributions in respect of his employment as a share fisherman, regulation 117(1)(a) and (b) and (2) shall apply as if the share fisherman were a mariner and as if the reference in regulation 117(1) to an employed earner were a reference to a self-employed earner and as if the words “or on behalf, or in respect, of” were omitted;

(c) for the purposes of entitlement to a contribution-based job seeker’s allowance, the weekly rate of any Class 2 contribution payable [F9 , or which is treated as having actually been paid under section 11(5B) of the Act (Class 2 contributions treated as paid),] by a share fisherman for any contribution week while he is ordinarily employed as a share fisherman shall, notwithstanding the provisions of [F10 section 11(2) and (6) of the Act (Class 2 contributions), be [F11 £3.80]];

(d) regulations 21, 100 and 108 shall apply to contributions payable at the weekly rate specified in paragraph (c) of this regulation as if references in those regulations to Class 2 contributions included, as may be appropriate, references to Class 2 contributions at that rate;

(e) regulation 43 shall apply to a share fisherman as if there were included at the end of paragraph (1)(a) of that regulation the words “or is entitled to a contribution-based jobseeker’s allowance or, but for a failure to satisfy the contribution conditions for that benefit, would be so entitled”;

(f) insofar as Class 4 contributions in respect of the profits or gains of a share fisherman in respect of his employment as such are not collected by the Board under section 16 of the Act F12 (assessment and collection, etc. of Class 4 contributions) regulations 103 to 110 shall apply as if the share fisherman were a person to whom section 18(1)(a) and (b) of the Act applied (Class 4 contributions for persons treated under section 2(2)(b) of the Act as self-employed earners)F13 ; and

(g) for the purposes of section 12 of the Act F14 and for the purposes of that section as modified by regulations 63 to 65, where an earner was a share fisherman when [F15 the earner became entitled to pay Class 2 contributions], any reference in section 12 to an ordinary contribution, and any reference in those regulations to the weekly applicable rate of a contribution, shall be a reference to the rate of Class 2 contributions prescribed for a share fisherman.

Textual Amendments

F9 Words in reg. 125(c) inserted (14.12.2022 with effect from 6.4.2022) by The Social Security (Class 2 National Insurance Contributions Increase of Threshold) Regulations 2022 (S.I. 2022/1329), regs. 1, 9

F10 Words in reg. 125(c) substituted (with effect in accordance with Sch. 1 para. 35 of the amending Act) by National Insurance Contributions Act 2015 (c. 5), Sch. 1 para. 33(1) (with Sch. 1 para. 33(2))

F11 Sum in Reg. 125(c) substituted (6.4.2022 immediately after S.I. 2022/232 comes into force) by The Social Security (Contributions) (Re-rating) Consequential Amendment Regulations 2022 (S.I. 2022/306), regs. 1(2), 2

F12 Section 16 was amended by paragraph 16 of Schedule 3, and Schedule 10, to the Transfer Act.

F13 Section 18 was amended by paragraph 7 of Schedule 1 to the Transfer Act, paragraph 18 of Schedule 3 to that Act and article 4 of S.I. 2000/755.

F14 Section 12 was amended by paragraph 13 of Schedule 3 and paragraph 3 of Schedule 9 to the Transfer Act.

F15 Words in reg. 125(g) substituted (6.4.2015) by The Social Security (Miscellaneous Amendments No. 2) Regulations 2015 (S.I. 2015/478), regs. 1(4), 16