Tonnage Tax is an alternative method of calculating corporation tax profits by reference to the net tonnage of the ship operated. The tonnage tax profit replaces both the tax-adjusted commercial profit/loss on a shipping trade and the chargeable gains/losses made on tonnage tax assets. Other profits of a tonnage tax company are taxable in the normal way.

Companies within corporation tax, which operate qualifying ships that are “strategically and commercially managed in the UK”, can take advantage of the Tonnage Tax regime. All qualifying members of a group have to come in together.