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System for administration of Minimum Training Requirement for Tonnage Tax Company in terms of sec.115VU of Income Tax Act 1961 and guidelines issued vide Notification published in Gazette vide S.O. 1436(E) dated 30.12.04.
Key Changes and Requirements
1. Minimum Training Requirements (MTR)
Tonnage tax companies must train specified numbers of Indian seafaring officers to meet 'Minimum Training Requirements' (MTR) annually.
- Calculation: MTR is calculated based on the number of man-days equivalent to the number of days ships are operated, multiplied by the number of trainee officers required (1 trainee for every 10 complement).
- Inclusion: MTR includes any shortfall from the preceding financial year.
2. Training Commitment
Companies must produce an annual 'Basic Training Commitment' (BTC) and submit periodic 'Annual Adjustments' (AA) for any changes in training obligation.
- BTC Submission: BTCs must be submitted to the Tonnage Tax Cell of the Directorate General of Shipping (DGS) within 30 days after publishing of the Guidelines or by 30th April each year.
- AA Submission: AAs must be submitted to the Tonnage Tax Cell within 30 days of the end of each year.
The training fee payable by trainee officers and administrative cost payable by both trainee officers and tonnage tax companies are prescribed and notified by the Director General from time to time.
3. Payment in Lieu of Training (PILOT)
If a tonnage tax company cannot meet its training requirement due to vessel type, it must pay 10 times the training fee and its share of the administrative cost to the Maritime Training Trust (MTT). For other non-compliance, it must pay 15 times the training fee and administrative cost.
Tonnage Tax Companies must ensure they comply with the Minimum Training Requirements to maintain their eligibility for the Tonnage Tax regime.
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