Do You Work on a Malta Flagged Vessel?

Do you own or work on a Malta flagged vessel? You NEED to read this…

Malta continues to be popular among owners and their representatives for yacht registration, particularly for those operating commercially. However, it is important for owners and crew to understand their obligations when it comes to social security if working on a Maltese flagged vessel.

Under EU Regulation 883/2004, a seafarer who is either a citizen or resident of the EU/EEA or Switzerland and is employed on a Maltese flagged vessel, must be registered with the department of social security in Malta, even if they are employed via a non-EU crewing agency.

For crew that are already contributing to another EU social security scheme, there is the ability to opt out, but the Maltese authorities will need to be informed accordingly and an exemption applied for in writing with supporting evidence of the payment of social security contributions in another member state.

However, given Malta has one of the lowest social security rates (currently 10%) among EU member states, for some crew, paying social security in Malta instead of their country of residence/citizenship may be more financially beneficial.

Those who are both residents and citizens of non-EU, UK or EEA countries fall outside of the scope of Malta social security and are expected to contribute to their own country’s scheme as required by that country’s law.

This year saw Malta make updates to its Social Security rates and rules, comprising increased employer contributions, income based contributions and deadlines for compliance with late payments or incorrect filings leading to possible penalties. These changes highlight the importance for owners and crew to ensure that they are up to date with their social security obligations in order to ensure they remain compliant.

Engaging a professional service provider to manage and administer your crew employment and payroll requirements can be significantly beneficial in doing so.

The Advantages of Outsourcing to a Professional Service Provider

Managing crew payroll is time-consuming, highly technical, and fraught with compliance risks, especially when you lack the understanding and knowledge of the applicable legislation or the processes of the relevant authorities.

Outsourcing this task to a professional service provider like Sentient International therefore offers significant advantages:

– We stay up to date with ever-changing regulations, ensuring accurate and timely contributions to Malta’s social security system.
– We understand the nuances of international crew employment, such as multi-currency payments and income reporting for diverse nationalities so offer tailored payroll solutions.
– We free up the valuable time of vessel owners and managers to focus on operations, while also avoiding potential penalties or errors that could result from non-compliance.

Outsourcing isn’t just about convenience – it’s about safeguarding your reputation, staying compliant and minimising risks. Our crew employment and payroll services include:

– Registration of crew with the relevant local authorities
– Issuing monthly statutory tax and social security reports for submission & payments to the relevant authorities
– Issuing annual statutory employer and employee reports
– Calculations of monthly payroll and preparation of payslips
– Crew Salary Payments
– Preparation and issuing of MLC compliant Seafarer Employment Agreements and Contracts of Employment, as required

For more information on how we can assist you with your payroll needs, get in touch with our team to discuss your requirements in more detail, at:

☎ +44 1624 616544
📧 info@sentientinternational.com

For more information on our Crew Employment and Payroll services, click here.