A and C, You are a sole trader and a pilot with a second income...I would expect you to know at least the basics. Or maybe,just like most self made pilot-entrepreneurs , you only spent a few pennies for the opinion of your accountant saving the money required for the job of an international law firm and their thorough look into crossborder taxation and social security issues. In my case , luckily , the latter comes for free. That's why I can assure you it is an illegal practice, otherwise any airline in Europe would move their HQ to Ireland and start having contractors spread all over the continent on the basis that in Ireland it's all legal and that they have nothing to do with any local legislation. By the way there are already a few cases in Europe where the local authorities are confronting Ryanair on these issues and when the shite hit the fan in France then FR did the only thing they could since the law wasnt on their side: close the base and leave the country.
Good point there Depone about which law applies in disputes, again if you talk to lawyers and leave the accountants to A and C you'll find out the following ( big and boring file,so just read article 5):
There are no social security issues with the way I conduct my financial affairs, but the misunderstanding may have come from my use of the word taxes, by this I was referring to income tax and what the UK call national insurance (social security contribution).
These are all paid in my country of residence (uk) in accordance with my sole trader status as recognized by the UK tax authoritys. I really can't see what more I can do to comply with the law as it stands, I suspect that you are resident in France and the French authority's take a different stance on this issue.
There is no doubt that Ryanair and others take advantage of the different stances that governments take on employment law and choose the places that best meet the needs of the company, the EEC should look into this but untill the EEC take action then the status quo is legal.
Some EEC action has been taken to have the Social security payments made in the country that the pilot is based but this law is being phased in over (I think) ten years and won't effect those like me who are already paying these contributions in their country of residence.
Location: Where the company needs me not where I want to be!
I work for FR,,,, on the old old old BRK contract as an F/O currently looking at command
its ok, I earn decent money still in a busy base, I can take home more than Captains on Ryanair contracts some months, BUT this is subject to no pension, no sick pay no holiday pay no job security no no no no no anything else you can think up! no illusions, top line is good, bottom line is undermined, I dont have a good enough calculator to work it out properly (I think ryanair know that!)
I have been happy so far, every job has its pitfalls and there are many here, but I suspect that there will be many in other airlines, this is not the only shower of out there.
are they bad to work for? well I think every 6 months the answer becomes closer to yes! and new cadets are likly to get big style, but while there are not many other options out there for 200hr wonder kids they will keep coming in the thousands, long term this place is as a place to work, lets just prey for no smoking hole in the ground, the training and safety is very good here so thank god for that at least
A and C, The more I read what you write the more I feel like I'm talking to the standard copilot who knows very little or nothing at all about the things we are discussing here and he's just happy to fly a 737 while being able to please the immoral people who EMPLOY us. As a sole trader YOU and in turn your FAMILY assets are liable in case of legal/tax disputes and this alone should make you think about how safe and comfy your status is. As a sole trader you cannot work for one client only and since it's not my intention to re-invent myself as a plumber or a gardener ( I would have no time nor any energy for that) I will not try to please Ryanair by doing that. When your contract expires you will have to provide them with an LTD anyways and pay SI in the country where you are based so the 10 years thing is not applicable and the new EU law has been in place since June 28th. If you then read the double taxation treaties you'll find out that any income generated by operating an aircraft in international operations should be taxed in the country where the enterprise has its base therefore Ireland until some other country (or court case) proves them wrong. You should pay your tax in the UK only for that portion of flights that took place domestically. If you are also a plumber then it is a vital piece of info where you actually live (more than 183 days a year) and where you carry out that second work because that goes under a different article in the double taxation treaty so you might find yourself to be paying taxes for p,umbing in one country and taxes for flying in another one.....what a headache huh?Informing oneself is painful..... I will give you another bit of legal info now: with the new EU law about SI you will not only have to pay it in the country where you are based but you will also and inevitably incur in local legislations which in most cases state that SI must be paid by the employer ( be it Ryanair or the contracting agency or the LTD or whatever) therefore the above mentioned entities will have to get registered with the national SI structures bringing in a whole lot of other obligations starting from the fact that Ryanair won't be able to claim they have nobody based in other countries and that their business is in Ireland only making it mandatory to apply local laws to the whole contract structure....or close the bases and run away just like they did in France.
If you then read the double taxation treaties you'll find out that any income generated by operating an aircraft in international operations should be taxed in the country where the enterprise has its base therefore Ireland until some other country (or court case) proves them wrong. You should pay your tax in the UK only for that portion of flights that took place domestically.
Have you taken legal advice on this? I see you include the words "until some other country (or court case) proves them wrong", so I think you realise this is Ryanair's interpretation of the law.
In fact, it is rubbish. The Double Taxation Treaty clearly states that you should pay tax in your country of residence except in certain circumstances. The location of Ryanair's head office is neither here nor there.
Ryanair are trying to rely on a piece of domestic Irish legislation which is overridden by the Double Taxation Treaty.
the double taxation treaties change slightly from country to country so legal advice should be sought considering the treaty between the country you are based in, the one you are resident of and Ireland ( since BRK is just a dummy company for RYANAIR and because they are not an airline I am excluding the UK from this reasoning). Most of these treaties mention the "international operations" when it comes to taxation and that is the position Ryanair as always had in defending their right to be taxed in Ireland . They have also used the same concept in relation to social security and that's why every new BRK contract had the pilot forcefully integrated into an Irish LTD, same goes for the Storm DECs. They have to prove that most of their pilots pay tax and SI in Ireland in order to be credible during court hearings. Too bad it's way too late now to cover up the scam.
A few things to get straight, I don't and would never work for Ryanair you are correct about me flying the 737 but I also have a current A320 rating and am firmly in the left seat with about 5000 hours in command. You seem to think that I am some sort of part time plumber, well perhaps I do get a bit involved in pipe work but that is because I am a director of an EASA 145 maintenance company and hold a B1 maintenance license for all of the aircraft the company deals with and it is not below me to get out on the hangar floor and fix aircraft. I am also the director of another aviation company.
So far I have commented on the law as it stands for my situation being a UK resident, the UK tax man sees my annual tax returns and I get inspected in detail about once every five years, I am sure that if the tax people were unhappy with any of my tax or SI payments I am sure they would not be slow to take action to get what they considered to be due to them.
I think that you have been given questionable advice about the SI payments being required to be paid to the country that the individual crew member is based in, that EEC legislation is not fully effective for about ten years as long as you are paying your SI in your country of residence this practice can continue untill the ten year limit has expired, it might be that if you are a new starter the legislation is effective immediately but that is not my problem.
I can assure you that I have taken professional advice on tax and SI matters and the fact that my tax & SI is only subject to full inspection once in five years ( the average in the UK) indicates that this advice is not drawing the attention of the tax authority's.
In the light of what you have said I think you should seek a second opinion as some of what you are saying about the new EEC legislation seems to be partly true but a bit short on the detail and as they say the devil is in the detail !
[QUOTE] The following is a rebuttal from the ECA. Which do you find more truthful?/QUOTE]
That´s an easy one Tillingdale, some guys will never ever even see the response though, even saw a guy chuckle the other day in the crewroom when he read the FR version of reality, 95% he still haven´t seen the response from the ECA.
Last edited by Pablo_Diablo; 11th Aug 2012 at 19:15.
Wow A and C, Chuck Yeager sounds like a rookie compared to you! Things are simpler than you think:
- you cannot consider yourself self employed/sole trader or even LTD owner if the business you do us with one company only and moreover if it is that company telling you when to work, when to take annual leave, giving you the tools you work with, not allowing you to be substituted by another similarly qualified person and so on....it's called social dumping. The French case says it all.
- the 10 years thingy with SI is the very limit but one can voluntarily request to abode by it or should any changes happen to his contract then the new law applies straight away ( change of base, command upgrade, instructor course etc.) moreover bear in mind that most contractors' contracts are about to expire soon and even if just signed ( before june 28th because from this date onwards the new law applies) then they are valid for 5 years only.
As a personal note I can tell you that this ryanair scam has started in Ireland and spread to the UK ( Irish airline and UK contract agencies) making it quite clear that the social and tax systems are quite friendly towards the likes of FR and Brookfield, thing that you seems to enjoy as well. In my country and in other countries as well ( and I'm not talking about any banana republic ) these contracts could never be written because illegal in most parts. If the Irish and UK authorities accept such primitive setups I have no problem with that , the problems start when they try to export such illegal and immoral practices abroad and telling me what I can or cannot do in my own country.
P.S. : you are a director of a EASA 145 maintenance company holding a B1 license on A320s plus you are a director of another aviation company all as a sole trader? Fantastic......
The B1 is not for the A320 it is for a number of other types (I did hold the A320 maintenance cover but under BCAR) the a A320 is a pilot type rating.
The reason that all this can be done as a sole trader is that I don't take a salary from any of the directorships, I am paid directors dividends when the company performance results in profit.
The reason for the UK and Irish authority's view on contracting is largely political, both country's take the view that they will tax people as little as posable and that if you don't work you don't get any money from the state, this is not wholly true but the money you are paid if you find yourself out of work in the UK is about €60 per week. As a sole trader I am not able to get unemployment benefit so my SI contributions reflect this.
As you might guess I am a very willing victim of Social Dumping, and am not a great fan of systems that take a lot of money out of the pockets of hard working people like you and I and encourages people not to work.
Your post on anther thread refers to pilots from French and Italian company's being paid up to 80% of their salary after loosing their jobs, this simply dose not happen in the UK or Ireland even if you have been employed, a few years back I was employed, the company went bust and the state gave the pilots about € 6000 as a lump sum (dependent in time in service) and €60 a week for unemployment and the €60 per week is reviewed after 6 months so you might loose that as well.
Without getting too political one might say that the social benefits in some parts of southern Europe are part of the reason for the financial crisis because the governments are giving away far more money than they have, so the only way For the government to get some money in is to aggressively tax those who are in work.
Typically the governments take the route that will get them the most money for the least trouble, they would rather go after individuals who can't defend themselfs in court rather than take on Ryanair and risk loosing in court or worse winning and have Ryanair up and leave the country and so loosing tax income resulting from Ryanair operating in that country because that is big money compared to the SI taxes on a few pilots.
I think it would have painted a better picture of the point I was making if you had also quoted the paragraph below the one you decided to cut and paste.
I am in broad agreement with you about how Ryanair do business with governments, basically the government will turn a blind eye to the way peope are being paid so long as the greatest amount of revenue is raised for the government. It would only take a court ruling to upset the cosy situation but Unfortunatly the Ryanair pilots are not united enough to have the power to do this, only when the guys get themselfs all into a union will they have the financial power to start taking court action.
The whole Ryanair thing is very sad and I would not work for them, I could only advise anyone considering doing so to have a clear exit strategy in place before they start.
I'm speechless B738driver, amazing post! Even A and C has now realized that FR/BRK are a bunch of mobsters doing dodgy business with corrupt authorities and that the only way out are the unions and legal action.