Amalgamation and Demerger Rules for Shipping Companies: Sections 115VY and 115VZ Tonnage Tax Scheme Explained

In cases of amalgamation and demerger of shipping companies, specific provisions apply under Sections 115VY and 115VZ regarding the tonnage tax scheme. For amalgamations, if the resulting company is a qualifying company, it must opt for the tonnage tax scheme within three months of approval. If the amalgamating companies are already under the scheme, the provisions continue based on the longest unexpired period. If a company was a qualifying company as of October 1, 2004, but did not opt in by December 31, 2004, standard tax provisions apply. In demergers, the resulting company inherits the tonnage tax scheme for the remaining period if it qualifies.