- McGinley contract
- Paying taxes in Ireland (20% until 32800€ gross and 40% above that)
- Paying Social Security (SS) in Spain (Spanish base)
- Employee SS tax in Spain 6.35% and Employer SS tax 33.30%
- Second year at Ryan (800 hours in the company)
- Flying 800 hours in the second year
Let's say that we have no costs deducted, so all the gross income is taxable:
Gross income expected: 52.900€ (700 hours at 65.5€/sbh + 100 hours at 70.5€/sbh)
Taxes in Ireland (over gross): -14.600€
SS contribution (6.35%+33.30% over gross): -20.974,85€
Total net for the year: 17.325,15€
Average net per month (12 months): 1.443,76€
Is this correct?
Not really correct.
€52900 is your company's income, not your personal gross salary.
The company's income each month is supposed to cover the social contributions ( a percentage of your income) + a salary to you as an employee. That salary is variable depending on how much you fly and invoice McGinley for your services.
If your company invoices McGinley €4408 euros each month your gross income, called X, would be: X + 0,333X = 4408. I get it to: €3307.
€3307 is the basis for taxation in Ireland. I would guess that the employee social security is a percentage of that sum too. Where I come from their is no such thing as employee's social contributions. It's the employer only that is responsible for paying social contributions.
When you buy computers, pay hotels and food, mobile phone bills, new headset.. not to mention a Type Rating.. for your hard earned (at some point taxed) money you can claim that as a company expense. These expenses are something your company has to pay back to You as a private individual. In the beginning of your Ryanair career you can let your company, with its money, pay out these expenses to you instead of paying out any salary. You don't have to take out any salary at all, in which case you don't pay any tax or social security at all, and people talk about the famous "retention rate of 100 %". Naturally, the expenses will dry up eventually and you will be forced to pay social contributions and income taxes like any other company in the world. A good rule of thumb is; you end up with 50 % of your company's income in your pocket.