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Old 24th Oct 2016, 04:07
  #84 (permalink)  
172_driver
 
Join Date: Jan 2006
Location: Between a rock and a hard place
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I think you have to look at each individual country to determine when you are tax liable. Ireland for instance have you tax liable when you are either a resident or your income is derived in Ireland. For some reason Ireland find it appropriate to make it your "tax home" for a) contractors, as their Ltd. is set up in Ireland b) employees, as they're on Irish territority during work, EI-registered aircraft. Finally it seems some countries, Italy and Portugal at least, have spoken out against this relationship and have you pay local taxes on domestic routes. I found it very strange to pay the majority of my taxes in Ireland even though I had never put my foot on that island a single day that year. Double taxation treaty with my country of residence sorted out so I wasn't taxed twice. Hence, the society which I benefited the most from got a big fat 0 of my salary. Reason has escaped the field of business.

Additionally, all countries I am aware of you tax liable where you are domicile. This may or may not be the country where you are based. Domicile is loosley defined as the country where you have the strongest family and economic ties. In my case it was a third country other than Ireland and the country where I was based. In the country I was based I was living under the radar, to avoid a third opinion of where I should pay tax. People that were based in Germany probably regrets that approach right now.

Lastly, an EU directive from 2012 has straightened out the coordination of social security in Europe. The "one size fits all" approach now makes it your responsibility as a contractor pilot, and Ryanair's responsibility for employees, to pay social security in the country where you are based. This may not be at all a good solution for you and personally I have lost money that I will never get back from this. But that's what the law says....
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