Fuel filter gap 3033 (Workmaster 35)

[Cfy7]

I just did the 50 hour service on my tractor and The fuel filter had been replaced at around 30 hours so I took it off to inspect it. I noticed there was some dirt and bugs around the top in the grove but not on the inside of the seals where it could get into the fuel flow, I cleaned it off and checked to make sure the filter didn't have any new dirt in it. (You could see debris in it when it had to be replaced earlier at 30 hours by the dealer)

So I put it back on and i noticed there is about a 1/16 - 1/32 of an inch gap between the top of the filter and the housing it screws into. It seems as the seals are fully seated and I don't think its leaking.

Is this correct, should there be a small gap on top of the filter?

Thanks!