N-305: Application for International Carriers of Foreign Countries Claiming Exemptions Under Section 235-7(a)(8), HRS (2025)
Hawaii · Hawaii DoTax · Used for tax years 2025
Hawaii Form N-305 is an application for international carriers of foreign countries to claim an income tax exemption under section 235-7(a)(8), HRS. It identifies the carrier, the claim period, the source of income, and the treaty or agreement supporting the exemption for income
Who files this form
International carriers of foreign countries doing business in Hawaii whose income is exempt under section 235-7(a)(8), HRS, should file Form N-305.
- If the carrier’s entire income is exempt, file this claim instead of a net income tax return.
- If some income is not exempt because it comes from other sources, file this claim and an income tax return reporting only the nonexempt income for that tax year.
When it's due
For tax year 2025, file the exemption claim on or before the 20th day of the 4th month following the close of the taxable year. The claim must be filed annually.
What you'll need
Have the following information ready to complete the form:
- The claimant’s name and foreign country.
- The beginning and ending dates of the period covered by the claim.
- The applicable agreement or treaty citation and provision number or reference.
- Mailing and business addresses.
- The foreign country under whose laws the carrier is organized.
- The date the business began in Hawaii.
- A full description of the source of income.
- The name, signature, and title of the person making the declaration.
How to file
Complete and date Form N-305, including the exemption period, treaty or agreement details, business information, and income description. Complete the declaration and provide a signature and title.
The form lists this mailing address:
State of Hawaii, Department of Taxation
Attention: Income Tax Assessor
P. O. Box 259
Honolulu, Hawaii 96809-0259
If all income is exempt, submit the claim instead of a net income tax return. If some income is nonexempt, also file an income tax return reporting only that nonexempt income.
Common mistakes
- Treating the claim as a replacement for every income tax return. It replaces the return only if the carrier’s entire income is exempt. If other sources produce nonexempt income, file both the claim and a return reporting only the nonexempt income.
- Overlooking the annual filing requirement. The claim must be filed every year.
- Signing without reviewing the information. The declaration states that the signer has examined the information and believes it is true, correct, and made in good faith, under the penalties in section 231-36, HRS.
Questions people ask
What exemption does Form N-305 claim?
It claims an exemption from Hawaii income taxes under section 235-7(a)(8), HRS, for international carriers of foreign countries.
What treaty-related statement does the form require?
The claimant must declare that income from operating ships or aircraft is exempt under the Internal Revenue Code through an income tax treaty or agreement between the United States and the foreign country. The form asks for the agreement or treaty citation and provision reference.
What reciprocal tax treatment must the claimant declare?
The claimant must declare that the foreign country’s local governments exempt, from all their net income taxes, income from operating ships or aircraft documented or registered under United States law.
Do I still need an income tax return if some income is not exempt?
Yes. File Form N-305 and an income tax return reporting only the nonexempt income for that tax year.