Info about tax and non-uk residence
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Info about tax and non-uk residence
Hi guys,
I am a spanish cabin crew working for BA. I work full time in LHR but commute to France. I have only been commuting for a few months and I am a bit oblivious to the tax bussines concerning uk non residents. Anyone out there on the same situation? I would like to know if I have to pay tax in France as I wont be paying income tax in the UK from April onwards ( hopefully ). My command of french is awfull so I am having difficulties on finding the info online. Any help would be appreciate it. Also any clarification on health insurance would be wellcome as I believe as non uk resident I no longer qualify for NHS treatment. Thanks a lot!!
I am a spanish cabin crew working for BA. I work full time in LHR but commute to France. I have only been commuting for a few months and I am a bit oblivious to the tax bussines concerning uk non residents. Anyone out there on the same situation? I would like to know if I have to pay tax in France as I wont be paying income tax in the UK from April onwards ( hopefully ). My command of french is awfull so I am having difficulties on finding the info online. Any help would be appreciate it. Also any clarification on health insurance would be wellcome as I believe as non uk resident I no longer qualify for NHS treatment. Thanks a lot!!
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Non Residence and the NHS
Hey There!
I am in a slightly different situation, but still this information might help you out... I also work for an airline but am permanently based abroad so, so long as I remain residing outside of the country and spend less than 6 months (total time) in a tax year (April to March) then I only pay taxes on my time spent in the UK, but only if you earn more than a certain bracket amount, from the top of my head I beleive its around GBP5k (maybe someone else can help out here with that figure). The way my company works and I am pretty sure that BA is the same is that I can either continue paying taxes throughout the year and claim them back after the tax year is complete and I have received the yearly P60. OR I can enter an program/agreement/? called the S690 in which the company deducts my tax but repays it in the same salary, although doing it this way increases your monthly income, you do need to be prepared to prove your time outside the UK if audited and either way you still need to fill in a tax return, so in short, if you can prove you are residing outside the UK for 6months and 1 day more in the tax year then you can claim back some if not all your taxes paid.
As for the NHS, again if it works the same way as my company, you MUST pay National insureance contributions regardless of where you live. This is where it gets difficult because some countries ie Germany allow you to have access to the German health system as long as you can prove you are paying N.I contributions via a form if I remember is called the E106 which BA should be able to sort out for you, but as I said, that may differ from country to country, using France as an example, I beleive that if you want to have coverage in France then you need to make some contributions yourself to the French system, but that I am not so sure on, so take that at face value.
I hope this helps about the UK side of things, Ill leave it to someone else to comment on the French system!
Good Luck!
I am in a slightly different situation, but still this information might help you out... I also work for an airline but am permanently based abroad so, so long as I remain residing outside of the country and spend less than 6 months (total time) in a tax year (April to March) then I only pay taxes on my time spent in the UK, but only if you earn more than a certain bracket amount, from the top of my head I beleive its around GBP5k (maybe someone else can help out here with that figure). The way my company works and I am pretty sure that BA is the same is that I can either continue paying taxes throughout the year and claim them back after the tax year is complete and I have received the yearly P60. OR I can enter an program/agreement/? called the S690 in which the company deducts my tax but repays it in the same salary, although doing it this way increases your monthly income, you do need to be prepared to prove your time outside the UK if audited and either way you still need to fill in a tax return, so in short, if you can prove you are residing outside the UK for 6months and 1 day more in the tax year then you can claim back some if not all your taxes paid.
As for the NHS, again if it works the same way as my company, you MUST pay National insureance contributions regardless of where you live. This is where it gets difficult because some countries ie Germany allow you to have access to the German health system as long as you can prove you are paying N.I contributions via a form if I remember is called the E106 which BA should be able to sort out for you, but as I said, that may differ from country to country, using France as an example, I beleive that if you want to have coverage in France then you need to make some contributions yourself to the French system, but that I am not so sure on, so take that at face value.
I hope this helps about the UK side of things, Ill leave it to someone else to comment on the French system!
Good Luck!
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Non UK resident/ Income tax
I own an apartment in France but do not commute from France to work.
I believe you do not pay UK or French income tax on your earnings but as you have left the UK during the current tax year I think they still deduct UK tax each month but it can be re-claimed in April. There is a special form needed to do this with. I am sure you will find someone you fly will have done this. You only pay French tax if you are employed in France or receive your earned income in France.
As far as health care is concerned; you could get basic health cover on the EU Health Card like people on holiday do, you can reclaim some of the charges. If you become ill make sure you go to a public hospital not a private one. My only experience of this is; someone I had staying with me on holiday became ill, she spent over 100 euros on treatment but only managed to get £5 back when she went home. I was later told this is because I took her to a private hospital because it was the nearest hospital to my apartment in Nice. The law changed recently whereby the only non-French people who can get completely free health care are retired people in receipt of a state retirement pension.
I believe you do not pay UK or French income tax on your earnings but as you have left the UK during the current tax year I think they still deduct UK tax each month but it can be re-claimed in April. There is a special form needed to do this with. I am sure you will find someone you fly will have done this. You only pay French tax if you are employed in France or receive your earned income in France.
As far as health care is concerned; you could get basic health cover on the EU Health Card like people on holiday do, you can reclaim some of the charges. If you become ill make sure you go to a public hospital not a private one. My only experience of this is; someone I had staying with me on holiday became ill, she spent over 100 euros on treatment but only managed to get £5 back when she went home. I was later told this is because I took her to a private hospital because it was the nearest hospital to my apartment in Nice. The law changed recently whereby the only non-French people who can get completely free health care are retired people in receipt of a state retirement pension.
Sounds just a bit complex - it's bad enough being a Brit employed in the UK but living in France, but add in the fact that your a non UK National and .... 
londoneasyjetbois got most of it, not sure about the 6 months though, perhaps that's because he is based overseas...anyhow here, roughly speaking, is how it works for the UK based Brit's living in France at the moment.
(i) To get any reduction in UK Tax you need to spend less than 90 days a year in the UK and also have your centre of interest outside the UK.
(ii) As far as getting a reduction in your monthly tax - you need to talk to both the BA pay office and HM Revenue and Customs, Centre for non-Residents ( it'll be in Google) , they should be able to help to arrange this.
(iii) At the moment you are not liable to pay tax in France on your BA pay but you are be liable to pay French Tax on any other income...e.g. any non-BA part time work you do, rental income, shares dividends, and you must to submit a French Tax return every year, wether you are liable to Tax or not...But here's the major warning - in the not to distant future (quite probably by next year) the French rules will almost certainly change and your BA pay will be fully taxable by the French Authorities.
(iv) You will be paying UK National Insurance through the BA payroll..this should entitle you to basic French Healthcare provided you have registered with the French authorities - since you are employed in the UK I would start by asking for a form E106 from HM Revenue and Customs, Centre for Non-Residents in Newcastle Upon Tyne .. ... it's also recommended you buy top up Insurance to add to the Basic French State Healthcover.
Hope this helps. BTW I've always found the staff in the local French Tax Office very helpful, as were the folks in the local CPAM (Healthcare) Office, despite my French, so they are worth talking to (but not just before lunchtime
). There are a lot of French Crewmembers in BA so you might want to pick their brains the next time you're in T5.
**edited to add - despite all the above comments I'm not a financial advisor and I've certainly no knowledge of the Spanish Tax Rules which may overide a lot of the above. If you want to be 100% sure of your tax situation IMHO you really have no choice but to consult a professional tax advisor.**
londoneasyjetbois got most of it, not sure about the 6 months though, perhaps that's because he is based overseas...anyhow here, roughly speaking, is how it works for the UK based Brit's living in France at the moment.
(i) To get any reduction in UK Tax you need to spend less than 90 days a year in the UK and also have your centre of interest outside the UK.
(ii) As far as getting a reduction in your monthly tax - you need to talk to both the BA pay office and HM Revenue and Customs, Centre for non-Residents ( it'll be in Google) , they should be able to help to arrange this.
(iii) At the moment you are not liable to pay tax in France on your BA pay but you are be liable to pay French Tax on any other income...e.g. any non-BA part time work you do, rental income, shares dividends, and you must to submit a French Tax return every year, wether you are liable to Tax or not...But here's the major warning - in the not to distant future (quite probably by next year) the French rules will almost certainly change and your BA pay will be fully taxable by the French Authorities.
(iv) You will be paying UK National Insurance through the BA payroll..this should entitle you to basic French Healthcare provided you have registered with the French authorities - since you are employed in the UK I would start by asking for a form E106 from HM Revenue and Customs, Centre for Non-Residents in Newcastle Upon Tyne .. ... it's also recommended you buy top up Insurance to add to the Basic French State Healthcover.
Hope this helps. BTW I've always found the staff in the local French Tax Office very helpful, as were the folks in the local CPAM (Healthcare) Office, despite my French, so they are worth talking to (but not just before lunchtime
). There are a lot of French Crewmembers in BA so you might want to pick their brains the next time you're in T5.**edited to add - despite all the above comments I'm not a financial advisor and I've certainly no knowledge of the Spanish Tax Rules which may overide a lot of the above. If you want to be 100% sure of your tax situation IMHO you really have no choice but to consult a professional tax advisor.**
Last edited by wiggy; 16th Sep 2008 at 06:49. Reason: Health warning added
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Be careful of the above advice, as in the next few years a new Double Tax agreement between France and Uk will be "possibly" approved by the two parliaments. This would mean that UK crew living in France would have to pay french tax on their entire earnings, with a credit for any taxes paid in the UK.
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British Aircrew Resident of France/Income TAX
The above posting is correct, shortly it is proposed that the UK and French will be making a new double tax treaty bewteen the two countries .There is proposal in the new treaty for French income tax to be paid by Uk aircrew who make themselves residents of France.
You can easily find details by searching the internet's French Tax information pages. If it does happen it may be fairly soon, not years away.
I would add the treaty has not yet been signed so there is a chance that it may not happen, we will have to wait a couple of months and see.
You can easily find details by searching the internet's French Tax information pages. If it does happen it may be fairly soon, not years away.
I would add the treaty has not yet been signed so there is a chance that it may not happen, we will have to wait a couple of months and see.
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Start here;
Types of tax : Directgov - Money, tax and benefits
I do not wish to alarm any of you who are not paying any tax right now, but;
Within the EU, regardless of where you live, regardless of where you work and regardless of where you are paid, you are required to pay both tax and National Insurance.
The rules governing payment and liability of tax and NI within the EU are many and varied, however, unless you are not working or have no income from any other source, you will be required to pay tax, even if you are retired.
The tax will generally be deducted from the country where you derive the majority of your income, so if you work for BA then you must pay tax in the UK.
Be very careful when you make any attempt at full or even part time employment within the EU and refrain from paying any tax. The penalties can be very severe. Remember what happened to Boris Becker and Michael Schumacher, who didn't declare income made outside their country of residence, thinking they were exempt somehow. They were not and only avoided prison by paying ALL of the tax they owed plus a hefty penalty.
No-one is exempt from paying tax. If you do evade paying you are committing a crime. You can and almost certainly will be found out eventually.
My advice is to speak to your tax officer, make a declaration to him, in full and pay any tax you owe promptly. Working in country A and living/commuting in country B or C and being a citizen of country D or E makes no difference. Within the EU makes you liable.
Death and taxes, much the same reaction to them both and both unavoidable.
Types of tax : Directgov - Money, tax and benefits
I do not wish to alarm any of you who are not paying any tax right now, but;
Within the EU, regardless of where you live, regardless of where you work and regardless of where you are paid, you are required to pay both tax and National Insurance.
The rules governing payment and liability of tax and NI within the EU are many and varied, however, unless you are not working or have no income from any other source, you will be required to pay tax, even if you are retired.
The tax will generally be deducted from the country where you derive the majority of your income, so if you work for BA then you must pay tax in the UK.
Be very careful when you make any attempt at full or even part time employment within the EU and refrain from paying any tax. The penalties can be very severe. Remember what happened to Boris Becker and Michael Schumacher, who didn't declare income made outside their country of residence, thinking they were exempt somehow. They were not and only avoided prison by paying ALL of the tax they owed plus a hefty penalty.
No-one is exempt from paying tax. If you do evade paying you are committing a crime. You can and almost certainly will be found out eventually.
My advice is to speak to your tax officer, make a declaration to him, in full and pay any tax you owe promptly. Working in country A and living/commuting in country B or C and being a citizen of country D or E makes no difference. Within the EU makes you liable.
Death and taxes, much the same reaction to them both and both unavoidable.
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UK/French TAX
There is a legal loophole that currently exists that allows flying staff who are employed in the UK but have become residents of France to espcape paying income tax in either country. They currently only have to make NHS payments in the UK. They are restricted to a minimum amount of days (45) that they may stay in the UK. per year If they exceed that limit they would have to pay UK income on all thier income in the UK in that year.
They are not tax evaders and are not doing anything illegal. Therefore they cannot be fined or prosecuted for non-payment of income tax anywhere in the EU. The reason that no income tax is currently required from them is due the the nature of their jobs and the fact they work in one county and reside in another.
This may well change as several people have already pointed out, perhaps it will perhaps it will not. The new treaty between France and the UK will soon be approved and it may well result in the people described above being liable to French tax on their entire earning in the UK. We will have to wait a liitle while and see if this happens. In the meantime our commuter friends are not evading income tax and are not doing anything illegal relating to income tax.
They are required to register themselves in France as residents to the tax authorities but the French do not appear to want to collect any income tax from them other than if it is income earned through working in France or income from investments such as rent from property they may own and let. They are however, subject to capital gains and inheritance taxes in France.
I own a property in France but do not commute to work from it, I use the property frequently on my days off but I am not a French Resident because I do not stay in France long enough per year to qualify for that status. I therefore pay all my income tax in the UK. I am subject to property taxes in France though. I could commute to work from France if I wanted to but I choose not to because I am married to someone who could not possibly commute to work from France.
I hope that explains the position.
They are not tax evaders and are not doing anything illegal. Therefore they cannot be fined or prosecuted for non-payment of income tax anywhere in the EU. The reason that no income tax is currently required from them is due the the nature of their jobs and the fact they work in one county and reside in another.
This may well change as several people have already pointed out, perhaps it will perhaps it will not. The new treaty between France and the UK will soon be approved and it may well result in the people described above being liable to French tax on their entire earning in the UK. We will have to wait a liitle while and see if this happens. In the meantime our commuter friends are not evading income tax and are not doing anything illegal relating to income tax.
They are required to register themselves in France as residents to the tax authorities but the French do not appear to want to collect any income tax from them other than if it is income earned through working in France or income from investments such as rent from property they may own and let. They are however, subject to capital gains and inheritance taxes in France.
I own a property in France but do not commute to work from it, I use the property frequently on my days off but I am not a French Resident because I do not stay in France long enough per year to qualify for that status. I therefore pay all my income tax in the UK. I am subject to property taxes in France though. I could commute to work from France if I wanted to but I choose not to because I am married to someone who could not possibly commute to work from France.
I hope that explains the position.
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How about living in Switzerland (outside EU), but working in UK. Spending less than 90 days in the UK each year?
Just wondered if this changed the situation? Is it possible to move to Switzerland without citizenship there? Does anyone know? All advice gratefully received.
Just wondered if this changed the situation? Is it possible to move to Switzerland without citizenship there? Does anyone know? All advice gratefully received.
KitKat..
I'm not sure where you are getting your information from and I don't want to start a spat but some of the info you are posting is incorrect and downright misleading.
Seeing as I live in France, commute to work in the UK and have just (phew!) completed my UK Tax Return I can state with some degree of certainty that you are wrong when you state there is a legal loophole that allows "flying staff who are employed in the UK but who have become residents of France to espcape (sic.) paying income tax in either country" and that they "only have to make NHS payments". That's totally incorrect I'm afraid. The current agreement means that qualifying aircrew pay a reduced level of UK Income Tax -but not nil tax
The qualifying period to achieve non-Resident UK Tax Status is being in the UK for less than 90 midnights per annum, a recent change from 90 days - don't think it has ever been 45.
You are however correct in saying that the above situation is legal, that UK National Insurance should be paid in full, that a Tax Return must be filed with the French authorities and that most importantly the rules are almost certainly about to change.
Frankly I wish they would change the darn rules - then, hopefully, I'll only have one Tax return to fill in a year
oh yeah, and I wish the pound would stop weakening against the euro 
Seeing as I live in France, commute to work in the UK and have just (phew!) completed my UK Tax Return I can state with some degree of certainty that you are wrong when you state there is a legal loophole that allows "flying staff who are employed in the UK but who have become residents of France to espcape (sic.) paying income tax in either country" and that they "only have to make NHS payments". That's totally incorrect I'm afraid. The current agreement means that qualifying aircrew pay a reduced level of UK Income Tax -but not nil tax
The qualifying period to achieve non-Resident UK Tax Status is being in the UK for less than 90 midnights per annum, a recent change from 90 days - don't think it has ever been 45.
You are however correct in saying that the above situation is legal, that UK National Insurance should be paid in full, that a Tax Return must be filed with the French authorities and that most importantly the rules are almost certainly about to change.
Frankly I wish they would change the darn rules - then, hopefully, I'll only have one Tax return to fill in a year
oh yeah, and I wish the pound would stop weakening against the euro
Last edited by wiggy; 24th Sep 2008 at 23:23.
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I suggest that anyone who is following the path that kitkat suggests should do a search of 'income tax' threads here on pprune.
You will see that the advice give is almost exclusively of the opinion that you are obliged to pay tax on your income in the country where you derive the majority of your income. This is the law.
If you work for a MAXIMUM of 45 days a year in any one country then you might well be exempt from paying any tax.
If you work for an airline in country A, live in your home in country B, commute betwen the two, and even if you are a citizen of country C, you still have to pay tax on your income.
It is called income tax and all countries in the OECD, the EU and most of the world, require that you pay it.
Do not try to be clever and neglect to pay any taxes. When you are found out, you will suffer a far worse penalty than the unpaid tax.
You might well be liable to repay ALL the unpaid tax and an unlimited fine or even prison.
I don't write this to try and frighten you, simply to point out the reality of the penalties imposed on tax avoiders.
I know this to be true because it happened to me.
You will see that the advice give is almost exclusively of the opinion that you are obliged to pay tax on your income in the country where you derive the majority of your income. This is the law.
If you work for a MAXIMUM of 45 days a year in any one country then you might well be exempt from paying any tax.
If you work for an airline in country A, live in your home in country B, commute betwen the two, and even if you are a citizen of country C, you still have to pay tax on your income.
It is called income tax and all countries in the OECD, the EU and most of the world, require that you pay it.
Do not try to be clever and neglect to pay any taxes. When you are found out, you will suffer a far worse penalty than the unpaid tax.
You might well be liable to repay ALL the unpaid tax and an unlimited fine or even prison.
I don't write this to try and frighten you, simply to point out the reality of the penalties imposed on tax avoiders.
I know this to be true because it happened to me.
rubik
You're right, I would suggest the answer to this question is to ask a suitably qualified financial advisor, not someone down the pub/in the crewroom/in the galley/ on pprune
You're right, I would suggest the answer to this question is to ask a suitably qualified financial advisor, not someone down the pub/in the crewroom/in the galley/ on pprune
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Wiggy
Living France - UK/France tax treaty
Wiggy,
Please forgive me for making a small mistake. You are correct I should have stated 90 days and not 45 days out of the UK. Certainly a day in the UK has to be a midnight when counting the days.
Please read the above link (you might have to type it in as pasting it did not work for me) then scroll down some way to the section headed Airline Pilots; that is where I got the information from. I stumbled accross the link quite accidentally when searching the internet for some information relating to other French taxes.
My understanding from the above link is UK income tax is
due on the first and last day of each trip originating and ending in the UK or for any other days worked in the UK providing no more than 90 midnights are spent in the UK per annum. My understanding also is that the only French tax that is due is from investments that produce a profit including rent and from other employment in France; at the moment.
I was not trying to mislead anyone in anyway. I was trying to be supportive to current commuters and informative to future commuters from the information I had read which I beleived to be correct as it comes from a reliable and professional source on the internet.
Happy commuting
Wiggy,
Please forgive me for making a small mistake. You are correct I should have stated 90 days and not 45 days out of the UK. Certainly a day in the UK has to be a midnight when counting the days.
Please read the above link (you might have to type it in as pasting it did not work for me) then scroll down some way to the section headed Airline Pilots; that is where I got the information from. I stumbled accross the link quite accidentally when searching the internet for some information relating to other French taxes.
My understanding from the above link is UK income tax is
due on the first and last day of each trip originating and ending in the UK or for any other days worked in the UK providing no more than 90 midnights are spent in the UK per annum. My understanding also is that the only French tax that is due is from investments that produce a profit including rent and from other employment in France; at the moment.
I was not trying to mislead anyone in anyway. I was trying to be supportive to current commuters and informative to future commuters from the information I had read which I beleived to be correct as it comes from a reliable and professional source on the internet.
Happy commuting
^^^ You beat me to it. I am not CC, but I am an accountant, so I know a bit about tax, and - aside from religion! - there is nothing on earth like a debate on income tax for generating misinformation and mistaken half truths, however well-intentioned.
The only way of getting correct advice pertaining to YOUR situation is to talk to a professional tax adviser on a one-to-one basis. It may appear that your situation is similar to someone else's but you can be pretty sure there will something that makes both of you unique with a unique answer to your query.
Even going to the interwebthingy may be more misleading than it's worth as it is rare that anything but generic and very general answers would be given.
The only way of getting correct advice pertaining to YOUR situation is to talk to a professional tax adviser on a one-to-one basis. It may appear that your situation is similar to someone else's but you can be pretty sure there will something that makes both of you unique with a unique answer to your query.
Even going to the interwebthingy may be more misleading than it's worth as it is rare that anything but generic and very general answers would be given.
KitKat
Hi
Thanks for the link..I know Bill Blevins's ( who, for those not in the know, is a high profile financial advisor to ex-pats) comment's in some of the Ex-pat papers/websites have raised a few eyebrows out here..certainly some ex-pats gained the impression pilots don't pay tax at all, which has led to some quite nasty comments from other Brits...
Anyhow hope you are well and hope you get out here in the near future to enjoy the early Autumn sunshine.
Best wishes
Wiggy
Thanks for the link..I know Bill Blevins's ( who, for those not in the know, is a high profile financial advisor to ex-pats) comment's in some of the Ex-pat papers/websites have raised a few eyebrows out here..certainly some ex-pats gained the impression pilots don't pay tax at all, which has led to some quite nasty comments from other Brits...
Anyhow hope you are well and hope you get out here in the near future to enjoy the early Autumn sunshine.
Best wishes
Wiggy
