Irish Tax
Disclaimer: I am a college student. Not a qualified accountant in any way. Do not rely on the following. it is just something i thought may be of some help to you if you are unfamiliar with the Irish tax system.
If you are based in DUB or SNN you are likely to be irish resident.
To check if you are so resident you look at whether you satisfy the following tests:
1. Are you resident in the country for 30 days or more in the tax year, if so go to test two.
2. Are you resident in the country for 183 days or more in the tax year, if so you are resident in that tax year. If not:
3. Are you resident in the country for an aggregate of 280 days or more in the tax year and preceding tax year, if so you are resident.
You are resident in the country on a day if present in the state at midnight on that day.
So if you are flying for FR based out of Dub or Snn on 5on 4 off or whatever you work you are bound to be caught by the residency rules. Which means you are liable for income tax- you need to consider your domicile now- which is a legal term. But at a very high level you may assume this is your country you are born in.
So if Irish resident and irish domiciled(working based in dub/snn and born in ireland) taxed on your worldwide income. Every cent you earn, be it employment income, dividends, rent anything.
If say, Irish resident but UK domiciled, (say an english born person working for FR out of DUB/SNN) you are liable to irish income tax on the remittance basis. this means you are liable to irish income tax on any income arising in ireland or the UK and income remitted to ireland from outside of ireland and the uk. which means income earned from your flying will be liable to irish tax.
For people considering whether to set up as a sole trader/contractor type arrangement I'd advise consulting a tax expert but I can't imagine you can make it work.
Revenue consider such factors as:
1. Terms of the contract, i.e if it provides for sick pay, holiday pay, pension entitlements, you are likely to be an employee.
2. Degree of integration of the person into the organization to which you are providing services. If you're working 5 on 4 off you're pretty much very well integrated.
3. Whether you provide your own helpers? If you do, likely self employed, if not, employee.
4. Whether you provide your own equipment. You FR guys sound like you do, bar the aircraft!
5. The degree of control exercised over the individual. I think this is an important test. Basically I'm presuming Fr give you a roster of what flights you are to operate and you are not free to pick and choose the days you want to work and that in effect, you are an employee as they 'control' you rather than engage you from time to time as a contractor.
6. the degree of responsibility for investment and management. (that falls on you in your 'self employed trade') not likely to be much if FR are your only contract.
7. degree of financial risk taken. (in running your trade, probably huge in getting an fATPL then TR then working as a cadet on buttons for 6 months as seems to be the case)
8. The opportunity for you to profit from sound management. (i think you'd fall down here too because basically not matter how well you manage your trade all you're going to get is what Brookfields pay you per hour.)
Obviously it's up to the Revenue to decide whether you are an employee or a self employed/Company. But then in company you have a surcharge on closely held companies, you need to pay yourself a dividend and that's income liable to income tax after having been liable to corporation tax.
I'd recomment seeking the advice of an accountant.
Brookfields contracts may be constructed specifically for tax reasons but then the revenue are likely to look for substance over form. I'd gamble that were they to look at it, Revenue would deem most to be employees and liable to irish income tax.
If people aren't declaring tax, under declaring they could get burned down the line. Interest and penalties accrue from when the tax should have been paid. So even if your caught 10 years later, it could be quite punitive. Usually in tax settlemtns interest and penalties far outweight the original tax liability.
I think it's best to be honest. By all means do your best to minimise your liability, but stay within the confines of the law. Seek professional advice.
An hour or two with a good tax accountant would be money well spent if it saves you tax off your bill, or prevents you getting burned later.
It's a bit like getting the class 1 before you train.