Ryanair FO German base
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Indeed, they handle it quite differently. And there might be quite a difference between a contractor and being directly employed. Never have been a contractor, so i cannot comment on that.
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German base
Hello ,
German tax question as I see many of are up to speed.
Are you guys paying taxes in Germany ? As far as I know , even being a resident myself of Germany I only pay social security and healthcare here . The taxes and USC are taken at source un Ireland and double taxation agreement protects from the the rest . Or you have other incomes that requires a tax return to be filed ? I am in the process to decide to use or not a tax advisor for this year due to a rental income , but I don't see much savings I can make anyways since majority of taxes is taken at source in Ireland. Am I wrong ?
Thanks
German tax question as I see many of are up to speed.
Are you guys paying taxes in Germany ? As far as I know , even being a resident myself of Germany I only pay social security and healthcare here . The taxes and USC are taken at source un Ireland and double taxation agreement protects from the the rest . Or you have other incomes that requires a tax return to be filed ? I am in the process to decide to use or not a tax advisor for this year due to a rental income , but I don't see much savings I can make anyways since majority of taxes is taken at source in Ireland. Am I wrong ?
Thanks
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Hey gentlemen,
thanks for the vauable inputs. I did a research on this in the past weeks and some things are not exactly correct for a FO hired through McGinley. In this case you only pay the social contributions in Germany whereas all taxes are paid in Ireland. Therefore: No Soli, no Church tax nada... Thats a good news.
The bad news is that the expenses CANNOT be used to lower the social contributions. You get the money you earn from RYR. Lets say 70k per year. Thats your gross salary + the employers contribution. You need to deduct 17,87% in order to get your gross salary for the tax purpose. That's 57,5k. Thats your gross salary. From this you need to pay 20,52% as an employee's contribution + the Irish income taxes. The only thing you can use your expenses for are the Irish taxes. So even if you have plenty of expenses and will pay zero tax you will never get more than 45,7k net. That is a maximum 65% retention rate. You will never get more out of it unless you opt out from the state health insurance system - which you actually can't, because you would have to earn more than 59,4k gross salary (current threshold for 2018 - goes up by 2-3% every year). But even if you slightly surpass the threshold an will have the option to go for the private health insurance, it brings you some savings in short run but in the long run it is always pretty difficult to get back to the state system. If you are German or wish to stay in Germany in the long term, you'll be surprised that on the contrary to the state system you will have to pay for the health insurance of your kids (free in the state system) and that your mothly payments will go up every year. One day, when you retire you'll have to pay up to 1000 EUR per month just for your private health insurance without any possibility to do something about it. Some people even pay more on health insurance than they get from the state pension system. Anyway... Opting out from the state health insurance brings the theoretical maximum retention for Germany to 76,6% - but you need to pay the health insurance on you own. That means 8 - 9k per year of additional income, 3,5k of which you pay for the private health insurance. Your total net saving is therefore 5,5k p.a. Which is not bad, but it gets much lower when you get older / have kids.
Interesting article on this: ht tps://oconnorandassociates.freshdesk.com/support/solutions/articles/25000013667-are-expenses-allowable-in-germany-to-reduce-the-amount-of-social-insurance-i-pay-
thanks for the vauable inputs. I did a research on this in the past weeks and some things are not exactly correct for a FO hired through McGinley. In this case you only pay the social contributions in Germany whereas all taxes are paid in Ireland. Therefore: No Soli, no Church tax nada... Thats a good news.
The bad news is that the expenses CANNOT be used to lower the social contributions. You get the money you earn from RYR. Lets say 70k per year. Thats your gross salary + the employers contribution. You need to deduct 17,87% in order to get your gross salary for the tax purpose. That's 57,5k. Thats your gross salary. From this you need to pay 20,52% as an employee's contribution + the Irish income taxes. The only thing you can use your expenses for are the Irish taxes. So even if you have plenty of expenses and will pay zero tax you will never get more than 45,7k net. That is a maximum 65% retention rate. You will never get more out of it unless you opt out from the state health insurance system - which you actually can't, because you would have to earn more than 59,4k gross salary (current threshold for 2018 - goes up by 2-3% every year). But even if you slightly surpass the threshold an will have the option to go for the private health insurance, it brings you some savings in short run but in the long run it is always pretty difficult to get back to the state system. If you are German or wish to stay in Germany in the long term, you'll be surprised that on the contrary to the state system you will have to pay for the health insurance of your kids (free in the state system) and that your mothly payments will go up every year. One day, when you retire you'll have to pay up to 1000 EUR per month just for your private health insurance without any possibility to do something about it. Some people even pay more on health insurance than they get from the state pension system. Anyway... Opting out from the state health insurance brings the theoretical maximum retention for Germany to 76,6% - but you need to pay the health insurance on you own. That means 8 - 9k per year of additional income, 3,5k of which you pay for the private health insurance. Your total net saving is therefore 5,5k p.a. Which is not bad, but it gets much lower when you get older / have kids.
Interesting article on this: ht tps://oconnorandassociates.freshdesk.com/support/solutions/articles/25000013667-are-expenses-allowable-in-germany-to-reduce-the-amount-of-social-insurance-i-pay-
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Health insurance is quite dependent on the company where you are insured. I had one premium raise in 15 years, some years where it was lowered, all in all still slightly above half of the state health insurance at much better service. And even with the public health insurance it depends on the company how much you have to pay, as each one can add their own premiums on top of the minimum percentage.
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Well, it's easy. It's like that virtually in any other country. In other countries you act like an idependent contractor - in German Selbständig. Therefore you take your revenue from RYR, deduct your expenses and calculate profit. From this profit you pay the social contributions and taxes. Therefore there is an over 95% retention rate in the first years (due to the type rating costs) in countries as Spain, Italy, Poland, Czech Republic etc. In Germany, on the other hand, you can't act as Selbständig if you're a pilot. Therefore you need to kinda employ yourself and pay both employer's and employee's part of the social contributions. What's even more bizzare is that you pay 1.9% of the gross salary as sick leave insurance (Arbeitsunfahigkeitsversicherung) but if you're sick, you won't get any money. It's because the employer is supposed to pay this money to the employee but as the particular pilot is both ER and EE, he won't get a dime etc...
Long story short, Germany is pretty exceptional on this. I would rather act as standard German independent contractor and pay all the contributions in here including the taxes but unfortunately it's not possible.
In terms of the health insurance. Both options have pros an cons. The one who says otherwise is definitely not objective. One can save quite a lot of money when he is young / has small or no family. On the other hand.... Wait until you're 65. I know people who are retired an pay around 900 - 1000 EUR per month for the premium. Thats 12k EUR per year, 240k EUR if they gonna live until 85. All of this with no other income than the pension.
Long story short, Germany is pretty exceptional on this. I would rather act as standard German independent contractor and pay all the contributions in here including the taxes but unfortunately it's not possible.
In terms of the health insurance. Both options have pros an cons. The one who says otherwise is definitely not objective. One can save quite a lot of money when he is young / has small or no family. On the other hand.... Wait until you're 65. I know people who are retired an pay around 900 - 1000 EUR per month for the premium. Thats 12k EUR per year, 240k EUR if they gonna live until 85. All of this with no other income than the pension.
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But does everyone who applies for a Ryanair contract get it after a few years? A couple of years ago it was just maybe 10% (if even that) of FOs who got a RYR contract.
Anyway you will most likely do the command upgrade within a couple of years from starting, and by that be forced to be a self employed contractor again.
Anyway you will most likely do the command upgrade within a couple of years from starting, and by that be forced to be a self employed contractor again.
