The HS205 Seafarers' Earnings Deduction (SED) is a tax relief available to mariners and their dependants in the UK. This scheme allows seafarers to deduct up to 95% of certain earnings from their taxable income when they are operating outside of UK territorial waters. The purpose of this deduction is to compensate seafarers for additional costs they incur while on-board, such as food and accommodation. Furthermore, the amount deducted is determined by the length of time spent at sea rather than the total earnings received by the seafarer during this period. The SED can be extremely beneficial for those who travel long distances and spend long periods away from home, as it can reduce their overall tax burden significantly.
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