Italian authorities closing down on Ryanair's contract scam

[dannyalliga]

Today's news circulating across the bases:

Monti presenta il conto a Ryanair: una tassa ad hoc | TTG Italia (http://www.ttgitalia.com/stories/trasporti/80657_monti_presenta_il_conto_a_ryanair_una_tassa_ad_hoc/)

Someone use google translator and paste here, I'm off today and I'm going to celebrate this news with a couple of beers!

[BroCode]

Crackdown on Ryanair with the Decree development . The document just approved by the Council of Ministers includes tax 'ad hoc' the Irish low cost.

Government enacts the law
FRANCESCO ZUCCO
According to what reported by Il Sole 24 Ore , the text includes a provision similar to that in force in France: the equalization of taxation of low cost to that of all other companies operating in Italy. At the moment, in fact, the carrier led by Michael O'Leary pay tax rates to 12 percent, according to the Irish legislation, even for Italian employees habitually employed in the Peninsula. To calculate the savings of the carrier, just keep in mind that the regulations require tricolor rate of 37 percent . The operation initiated by the government should bring in about 100 million euro . That figure, of course, would be to undermine the profits of the company. Decision of the Government Monti to adjust the rates of low cost puts a further question to a business model that now seems close to a revolution. Until a few days ago in the dock there were only the financing of airports with no frills (and in particular its Ryanair) now may be at least one other engine development of the carrier, the application of different working conditions those referred to in Italy. Now awaits the response of the CEO O'Leary.

Translated from above link (http://www.ttgitalia.com/stories/trasporti/80657_monti_presenta_il_conto_ryanair_pagher_le_tasse/)

[dirk85]

Lets specify we are talking of social security (including pension) not income taxes, that will still be paid in ireland.
Very good news nonetheless.

[dannyalliga]

Lets specify we are talking of social security (including pension) not income taxes, that will still be paid in ireland.

That's not the info that is circulating lately, that's what the Irish revenue would love to keep but an in depth analysis of the issue seems to suggest that the whole thing will have to be paid in Italy.
This new approach is based on several pieces of evidence like the concept of "base",the concept of "effective management", the concept of "international operations", the definition of "employee", the law about "contract workers" and a few other bits of Italian legislation.
Just to give you an idea it seems that in order to comply with just social security any business activity must have a local office or branch through which it employs its workers, consequently these workers must have an Italian contract....and so on.
Fun times ahead.:}:}:}

[bucko]

Isn't this something similar to how employment via FR/Brookfield is set up???

BBC 'helped its biggest stars to dodge tax' - Europe, World News - Independent.ie (http://www.independent.ie/world-news/europe/bbc-helped-its-biggest-stars-to-dodge-tax-3250290.html)

[16024]

No.
It's the complete opposite of the alleged BBC thing. That worked in favour of the employee. The FR scam works in favour of the company, and the Irish revenue. Why else do you think everyone is so pleased that the authorities are trying to stop it.
Does anyone else appreciate the rich irony that it takes the Italian government to expose alleged corruption;)

[dirk85]

That's not the info that is circulating lately, that's what the Irish revenue would love to keep but an in depth analysis of the issue seems to suggest that the whole thing will have to be paid in Italy.
This new approach is based on several pieces of evidence like the concept of "base",the concept of "effective management", the concept of "international operations", the definition of "employee", the law about "contract workers" and a few other bits of Italian legislation.
Just to give you an idea it seems that in order to comply with just social security any business activity must have a local office or branch through which it employs its workers, consequently these workers must have an Italian contract....and so on.

Unfortunately I had to make a lot of research on this matter, working myself for a foreign company (EU based) operating in another EU country. Not FR.
Disregarding the big mess that is the whole employed/self employed thing in FR (de facto we can consider them employed, being per contract not allowed to freelance for anyone else), when it comes to INCOME TAXES, between most of EU country there are bilateral agreements to avoid double taxation. They are valid for all kind of income subject to taxes, including salaried employees and self employed people, in aviation and not.
In particulat between Italy and Ireland, see link
http://www.fiscooggi.it/files/immagini_articoli/fnmold/irlanda-it.pdf
The article 14.3 specify that for people employed on board of planes and ships, the salary is taxed where the headquarter of the company is situated, in this case Ireland. Italy is not discussing on that.
Another matter is the social security.
The new EU Reg 465/2012 is very clear in this, but also before that it was already applicable: the social security needs to be paid where the worker is based. In Italy the social security is roughly 25/30% of the gross salary on the employer, and about 10% on the worker. Having paid that you have the right to use all the Italia security system, including public health system (free in Italy), unemployment benefits, maternity and sick leave, state pension etcetera. In Ireland the social security is much lower, especially for non resident.
In conclusio it is very common and legal to be in the condition to pay the income taxes in one country and the social security in another country.

Having said that FR employees have "enjoyed" their salaries with the very low irish social security contributions.
No doubt that FR will now modify the contract in such a way that they have to fork out, between the worker and italian state, the very same amount of money they are spending now. No way they are gonna have their profits reduced after all... :rolleyes:
The difference will be absorbed by the worker, that means for the pilot a paycut of more or less a 25/30%.
Not necessary only a bad thing, especially for those who want to continue to work in Italy or have a story of contribution in Italy: the Italian pension system is actually one of the best in Europe, despite the latest modifications, ad the same goes for the unemployment benefits and similar stuff.

[dannyalliga]

dirk,

you forgot to mention one thing of para. 14.3: INTERNATIONAL OPERATIONS.
I can guarantee this is being looked into by a pool of legal people with "powerful" connections....
And there are other things you forgot to mention like the effective place of management, with 40 aircraft and crews permanently based in Italy it will be hard to prove you are just "passing by".....and remember that if it was like FR claims then every airline would move their offices to Ireland and happily operate in Italy,Spain,Germany,Sweden etc. enjoying irish tax benefits.
Another thing is social security, you seem to know your stuff so please explain how in practice you can pay social security in Italy from say your Irish/Maletese/Cypriotic company.

[dirk85]

I agree is clear that FR has a lot of support offices in Italy, but the most common interpretation so far is that the nationality of the company is determined by where the main headquarter is based, where the administrator operate and take their decisions. I am pretty sure it is in Ireland in this case, but you never know of course.
Let's take a company with bases worldwide. It would be difficult and very expensive to pay taxes in every single country you have a base, with all the different legislations.
Or, like many, including myself, you can get the gross salary in your bank account, and once or twice a year pay the taxes where you are due to pay. Income taxes is after all on the worker, not on the company. In most circumstances the employer can pay the taxes on your behalf taking it from your payslip, but in all the country as far as I know there are provisions to leave this task to the worker, through a commercialist or by himself.

How to pay social security?
I know how it works in Italy for foreign companies.
If you have many employees the most convenient is to have an office, or even a company employee in Italy, that in from of Italian SS system acts on behalf of the employer, paying contributions and adhering to the local laws.
Smaller companies achieve the same result by delegating an Italian commercialist that will do the same things, paying the employer and the employee part of social security and everything else. It is not as difficult as it sounds in fact, and I am pretty sure that the same is in all the other countries...

In my case it is a Maltese company with employees in all Europe.

[dannyalliga]

Dirk,

I hate to bring bad news but very recently these dodgy employment practices have been investigated by professionals connected to the associations and to the labor courts.
By the way I think one of the above setups, the Maltese one, has been specifically looked into by professionals (not accountants but lawyers and labor experts).

What you say about the difficulty of having multiple bases across Europe with different tax,social and contract issues is what FR is claiming and making you believe but in fact our direct competitor Easyjet does just that with extreme ease.

Under the Italian legislation pilots are not self employed nor can be directors of companies that perform as pilots for a third party but , as you also mentioned, they are employees.
Now the question is: whose employees are they?According to you and BRK/FR they are eventually employees of all those different companies/LTDs that BRK forced them to set up across the EU.
Well according to the experts that is not true for various reasons linked to bits of the Italian legislation dealing with contract workers who cannot be subcontracted to a third party company for such long periods of time as per the BRK/Strm contracts (5 years), making them in fact FR employees.
Another huge problem, even if it was possible to subcontract workers for such long periods of time, is the fact that contract agencies are a highly regulated sector in Italy and must be officially registered as such making any "foreign" company not complying with the above national laws an illegal business on Italian turf.This also brings in another threat for those,like you, who operate in Italy through foreign companies: sanctions for the company itself , therefore you.
Let's say now then your Maltese company was to comply with the above regulations and was registered in Italy as a contract agency , well now it would have to hire you locally therefore with a local contract in order to be fully compliant.


This is just an overview of the briefing that was given by these professionals.

[dirk85]

I don't know what kind of weird ideas you have built in your mind when you talk about my case.
I work for a Maltese general aviation company, with headquarter, AOC, office and whatnot in Malta. The planes and the crew are based where the owners of the planes want them to be based.
I, Italian resident, based in Italy, pay the income taxes in Italy. Every single cent of it. The company, and in part me, pay the social security in Italy.
To be noted that I could have paid income taxes in Malta, according to Malta-Italy agreement, but Malta oddly enough doesnt have any provision in its legislation to tax non residents in the context of international traffic.

It is perfectly legal, also after consultancy with local autorities, and the best way to do it, considering that crews are based in different countries. We are talking about small numbers, and it would make no sense in our case to have X local contracts, with X accountants taking care of local legislations.
I am lucky enough not to work for Ryanair.

Got it?

As per FR I agree the whole construction is an absolute disgrace, meant since the beginning to minimise the rights of the pilots, that are employees de facto, but with none of the right they should be entitled to have.
But nobody pointed a gun at their heads, and I did not hear any of them complaining when getting money almost tax free and with no contributions.
I would find it extremely amusing if now they would be complaining of the imminent paycut they are going to receive, when in fact they should only thank the politicians for what they are doing now. For once...

[sarah737]

Dirk is correct. EU 465/2012 dictates that SOCIAL SECURITY has to be paid in the country where your base is situated. Usually the pilot is a director of an umbrella company which in turn provides services to Fr via Storm or Brookfield. It is the umbrella company who employs the pilot which has to pay the employers contribution.
TAXES are as per double tax treaty between the country of residence of the pilot and the country of residence of the umbrella company. These are international agreements which have priority over national tax lax and Italy can not change them unilaterally.

[dannyalliga]

Dear Sarah,

you should get your facts right and don't take everything you hear from BRK/FR as what the law and regs say.
The BRK setup in Italy is illegal and there is no double tax treaty that can over rule labor LAW.
If you were well informed you would also know that one of the trusted BRK accountant has been in Italy seven times in rider to setup an Italian branch.
And you know very well that FR/BRK wouldn't do anything like that unless absolutely needed.

[sarah737]

Danny,
You are the one mixing things up! Labor law has nothing to do with taxation. The Italians can force FR to follow Italian labor eg maternity leave, duty times... BUT the can NOT change European social security regulations nor foreign tax matters.
I didn't recieve any advice from FR/brookfield but paid international advisors who are experts on the matter.

If eg a Belgian resident works on a FR contract in Rome, he can continue to pay his social security in Ireland for another 10 years according to EU 465/2012. He will pay his taxes in Ireland till the Irish-Belgian tax treay changes. Nothing the Italians can do.
The umbrella septup is dodgy, but there again it is the taxman from your country of residence who has the authority.
If the guy works via Brookfield the Belgian taxman can sue him for fake self employment, but once again nothing the Italians can do.

Of course the story is totally different for Italian residents, they could indeed be in big trouble very soon.

[plain-plane]

It is no secret that FR already have a special contract ready for all their "italian based" pilots..

it has been ready for well a year... so I guess their pilots will one day have a new contract as required reading... with a nice little reminder that they will be removed from flying duties if contract is not signed within 1 week...

Only MRS was to be a shadow base i guess...

[dannyalliga]

Sarah,

Labor law can not only change taxation and social security but it can also take you to court if you dodge it.
Labor law in Italy clearly states that agency workers must abode by the specific regulations that apply to that sector, if BRK or any other company does its business in Italy through its workers (be it directors or pilots it doesn't matter) then this company will be subject to Italian labor law.
In Italy It is illegal for an agency to lease workers to a third party without being registered and abiding by specific and strict laws, even more so if this agency (BRK or storm) leases workers through contracts they sign with umbrella companies like the many LTDs they forced people to be directors of de facto adding an additional illegal intermediary between the actual worker (the pilot) and the actual employer (FR).
It is illegal for Italian companies, why should it be legal for Irish /Maltese/Cypriotic companies to do it on Italian soil?

Some consideration to the concept of residency should also be given: if you are a Belgian resident but you permanently work for an Irish LTD in Italy then it will not be up to you to tell the authority where you reside but it will be for the authority to determine according to several different criteria like where you have family ties, where you spend most of your time, where you carry out your work and so on.
If they determine that you in fact reside in Italy then your claimed residency won't help you with the tax man nor the social security office because for them you are fiscally and socially resident where they say.
Slightly different story for FR employees since the double tax treaties specifically deal with airlines and their place of effective management,their employees and international operations. But even in this case there is an ongoing debate which is at an official level because the authorities have already started asking FR for millions of unpaid social security for its Italian based crews, and this claim has been filed well before the newest EU law and it is based purely on the double tax treaties.Pretty much the same as the French case in MRS.
Some bases in Italy mostly fly domestic and all of them in general have a good 50% of domestic flights which makes it a huge business that has nothing to do with the definition of “international traffic” and its meaning in the tax treaties.

If you then investigate the technical details of being resident in Italy for social security reasons (as explained this is the case even before the new law especially for crews not on a permanent FR contract) then you’ll find out that you cannot divide social security from tax due to the fact that your Irish/maltese/whatever LTD (which is not an AOC holder therefore not comparable to an airline) is operating in Italy with workers based in Italy who must therefore abode by Italian labor law, beginning with an Italian compliant contract.

It is no secret that FR already have a special contract ready for all their "italian based" pilots..

it has been ready for well a year... so I guess their pilots will one day have a new contract as required reading... with a nice little reminder that they will be removed from flying duties if contract is not signed within 1 week...

You'll be surprised at how not ready FR is in this matter....

[DjerbaDevil]

It has been reported that the following news item was printed in the Sunday Times on 7 October 2012:

HM Revenue & Customs is putting the squeeze on pilots and air stewards who avoid income tax by saying they do not reside in the country. Some 2,300 aircrew do this on the basis of the time they spend mid-air and in other time zones, although most have homes, bank accounts and even children in Britain.

[wiggy]

Djerba

I suspect that story has been triggered by the fact that HMRC have recently written to all "flying" ex-pats asking them to confirm their status so I'm not sure it's related to the subject of this thread.

I also suspect :ok: that a lot of the ex-pats the Times is referring to, whilst perhaps working for UK airlines, simply don't live in the UK and therefore pay their tax elsewhere, there's a bit more to their claims of being non-resident than simply " the time they spend mid-air and in other time zones".

.... most have homes, bank accounts and even children in Britain

FWIW having any of those does not automatically disqualify you from being non-resident for tax purposes, it depends on the exact circumstances ( though to be fair using your house in the UK as your own home might just cause a few problems..).

That said there's no doubt HMRC is looking harder at everybody.

[Icelanta]

The Belgian Taxman can sue FR for False Self employment, NEVER the employee. European and Belgian law states that in case of false self employment, the employer is always the defendant.

[dannyalliga]

Ryanair accused in northern Italy of evading tax to value of €12m - The Irish Times - Wed, Oct 17, 2012 (http://www.irishtimes.com/newspaper/finance/2012/1017/1224325339094.html)

[RAT 5]

How many of BGY RYR pilots & cabin crew are RYR employees and how many BRK and the cabin crew agency? Surely, only RYR employees can be said to be on Irish contracts? All others are employees of the various agencies, which i believe are UK based. Could be interesting times.

[Carmoisine]

RAT 5

I don't know the figures but I had a few base rosters in my hands recently and I can tell you that the vast majority and I mean 80+% of Pilots and Cabin crew are "agency" workers.

[dannyalliga]

Corriere della Sera - BERGAMO
section: Report date: 19/10/2012 - page: 4
The government blinda Ryanair

Tax, the company will pay as an Italian
The government "wraps" the giant low cost. Decree-Law 'Growth 2.0 ", which is being published in the Official Gazette, puts an end to casual maneuvers contribution of volcanic CEO Michael O'Leary. Ryanair is considered, to all intents and purposes, an Italian company. With all that this implies for taxes, contributions and health care. Not only that the law is retroactive from January 1, 2012. And it is a retrospective non-appealable. Thus ends the era of "unfair competition", as it was stamped several times by other airlines operating on the national territory and that, despite having a license issued by another Member State of the EU, pouring taxes and contributions in accordance with Italian regulations ( such as Air France or Lufthansa). So far Ryanair had always paid according to the contribution regime in Ireland where the average tax on wages is 12 percent (compared to the Italian average of 37). On Wednesday, the giant of the skies, with a note from Dublin, had said that for new hires in the Italian bases would have paid social security contributions subjection to the law of Italy. A "surrender" through gritted teeth, heavily conditioned by a circular INPS which included a provision of Community law entered into force in June. The article stated once and for all the notion of "basic service" as the place where the crew member designated by the operator begins and ends the day's work. Now the government wants to harness once and for all the Irish giant of the skies. Paragraph 1 of Article 38 of Decree-Law "Growth" Ryanair states that not only will have to pay the contributions, but must submit in all respects to our taxation as other Italian companies that produce income in the beautiful country. It is the gravestone to "distinguish" the lawyers of Mr. O'Leary, who have always objected to the fact that the company is Irish and employees, employed on contract in Dublin, Ireland operate on vectors. Here is the text of the decree of the government, as of October 15, the Courier is able to anticipate: "For the purposes of aviation law, the term" base "refers to a set of premises and infrastructure from which a company carries out a stable, regular and continuous activity of air transport, using employees who have their basis in the place of work, in the sense that work there, you take the service and return there after the conduct of its business. An air carrier with a valid operating license issued by a Member State of the European Union other than Italy is considered to be established on the national territory when exercising on a regular basis or continuous or regular activity of air from a base as defined the previous period. Notwithstanding Article 3 of the Law of 27 July 2000, n. 212, this paragraph shall apply as from the tax period in progress at December 31, 2012. " And the tax year 2012 begins on January 1, counting, waterfall, all the skills, not only the contributions. Meanwhile, the INPS does not give up on the previous. After the findings of the Provincial Directorate of Labour of Bergamo, the security agency has notified an order to pay almost € 12 million to Michael O'Leary and his right arm, Juliusz Komorek, Director of Legal Affairs for grants not paid to 220 employees moved from Orio al Serio between 2006 and 2010. A charge that has cost O'Leary and Komorek registration under investigation by the prosecutor Maria Mocciaro, but they strongly contest. Riccardo Nisoli PLAY PRIVATE

[F14]

Sounds like a conclusive victory for the Italians. To be fair must long timers in FR Italia left over the last 2 years, when the noises from the taxman got louder.

I feel sorry for the folk who got based down there against their preferences. Hopefully they will at least get recognition as employees. But there again many of the newbies are using training loan payback to offset 100% of tax through their LTD company set ups.

[DjerbaDevil]

Just received from my Italian source
Corriere della Sera - BERGAMO
section: Report date: 19/10/2012 - page: 4
The government blinda Ryanair


The web site at the above newspaper only has one news story for Ryanair on 19-Oct-2012 about the Ryanair Calendar and another story dated 18-Oct-2012 saying that Ryanair will defend their case and that they abide by EU law concerning taxes and employment.
Perhaps my searches were looking in the wrong place, so would be grateful for the URL where your translation of the Italian court sentence may be checked out.
Thank you.

[AlfaSix]

First of all I'm new on this forum so hello everyone!

The court case will be in February. For the time being the Italian government has issued a Decree Law which have to be turned into Law whithin 60 day, and that will happen. I can't find anything in the news at the moment but I'm sure I read an article on Friday:confused:. Any way you can find at this link the Decree Law.

http://www.gazzettaufficiale.it/moduli/DL_181012_179.pdf

It's the Article No 38 page 51, It might be difficult to translate with google though. If I can help I'll be happy to do it.
Now, with this law the outcome of the trial in February is obvious.

[Ryanairpilot]

Il governo blinda Ryanair (http://archiviostorico.corriere.it/2012/ottobre/19/governo_blinda_Ryanair_co_0_20121019_19e9e8a2-19b0-11e2-bb29-0d81cbbb3d7a.shtml)

[A and C]

As I see it the problem is that some airlines are using the lack of a common labour policy across the EEC to their advantage.

The original document that set up the EEC made it clear that there was to be free movement of labour within the EEC and restricting a workers right to work in one EEC state by penalising them for being paid in another EEC state could be seen as a direct infringement of the Treaty of Rome.

At the moment the Danish tax authority's have withdrawn the bilateral tax agreement with Spain so in theory a Danish resident who is based in Spain could face the same income being taxed in two EEC states (and probably find a negative number as payment at te end of a months work !). This situation is obviously untenable as it restricts free movement of labour.

The social tax issue is also a problem with some EEC states wishing to get the social tax from all the people based in that EEC state and the EEC state that the person is resident in also trying to collect that Social tax.

All these attempts at the double taxation of a persons income are in direct conflict with other EEC regulations.

The problem is that when the EEC was set up the regulators simply did not foresee the free movement of Labour as more that a theeorectal aspiration and a thing that a few of the super rich could do. Forty years on the movement of labour within the EEC is common with thousands of people working it One EEC state and resident in another and this is all happening without clear EEC wide legislation to regulate it.

The issue is far bigger than Ryanair and as long as there is a conflict in the legislation between EEC states company's and individual's are quit at liberty to use the legislation of the EEC state that best meets their needs, to put it simply what may be unlawful in Italy could be within the law in Ireland and so they would choose to be taxed in Ireland leaving the Italian govement with a leagal problem that is heading in the direction of the very leagal foundation of the EEC if they decide to act against the company or individual.

Until all the EEC states get a common income and social tax system in place this problem will continue and I don't see the EEC rushing to fix anything, after all the new Social tax directive has a ten year phase in period.

[maybepilot]

to put it simply what may be unlawful in Italy could be within the law in Ireland and so they would choose to be taxed in Ireland leaving the Italian govement with a leagal problem that is heading in the direction of the very leagal foundation of the EEC if they decide to act against the company or individual.

A bit of a simplistic view, when it comes to legal stuff things are much less theoretical and much more practical.
Especially when they involve millions of euros.
There is a treaty called "Lugano Convention" which , to put it simply, defines which country has the authority over a legal case and therefore which law and legal venue applies.
Its content is pure common sense: if a legal issue arises then it will be handled in the country where the alleged wrongdoings were perpetrated.
If the Italians can prove that Ryanair has bases and operating crews based and living within their territory then the case will be held in Italy and according to Italian laws.
Here is more on the treaty, just to stay informed:
Texts: Lugano Convention and Protocols (http://curia.europa.eu/common/recdoc/convention/en/c-textes/_lug-textes.htm)

[A and C]

The Italians may take the view that just because someone is technically based in Italy then they get all the taxes.

Some of us on commuting contract have House, Wife , Car in one EU State, are contracted to an airline in another EU state and are based in a third EU state.

If the roster falls my way I get on an aircraft from my state of residence, land in my Base EU state and then spend five days flying around Europe and then at the end of the duty get on an aircraft back to my state of residence. Wth luck I I will be in the EU state that I am Based in only a few hours a month.

What would the Lugano convention make of that ?

I have no objection to paying the correct tax in any EU state but my concern is that when my pension is due the EU state that I have been taxed in will not pay the pension on the grounds that I have never been a resident.

An English guy that I know who has been resident in France and paying French tax for 25 years has yet to get anything out of the French social security system simply because he is not French, I fear that this is just a Money grab by the EU states that are in economic trouble and that if I am forced to pay taxes in my base state but I will not get any pension from them when I retire.

As I have said above the EEC has to get its act together and come up with a common taxation policy that does not discriminate against those workers who live in one state and work in another.

[dannyalliga]

A very good source just told me that the BGY crewroom has been raided by the financial police yesterday.

[Dg800]

The Italians may take the view that just because someone is technically based in Italy then they get all the taxes.Utter nonsense. The issue is only about social contributions, nobody is questioning their right to pay income tax in Ireland pursuant to the bilateral agreements.

An English guy that I know who has been resident in France and paying French tax for 25 years has yet to get anything out of the French social security system simply because he is not French, I fear that this is just a Money grab by the EU states that are in economic trouble and that if I am forced to pay taxes in my base state but I will not get any pension from them when I retire.I have to call bull**** on what your friend is claiming. Citizenship is not a requirement, not even in ultra-nationalistic France.

As I have said above the EEC has to get its act together and come up with a common taxation policy that does not discriminate against those workers who live in one state and work in another.Income taxes are a matter of national policy, thee EEC has no "act" to "get together". For trans-national matters there are existing bilateral agreements, that make sure that no "discrimination" (read double taxation) takes place, at least within EU member states.

I have no objection to paying the correct tax in any EU state but my concern is that when my pension is due the EU state that I have been taxed in will not pay the pension on the grounds that I have never been a resident.If you pay social contributions in one country, you will get the same benefits anybody who pays into the same system will get. If you don't trust the government to fulfill its obligations (f.e. because of a future default) then all you can do is emigrate. You cannot refuse to pay just because you don't "trust" them.

[FerrypilotDK]

I won't even get into the aircrew aspects right now, as it is just a nightmare. Swedish pilot, flies for UK company(managed aircraft) aircraft "based" in Belgium, but physically most flying is to/from Moscow and other EU and non-EU countries.

But the issues are not limited to our industry.....nor are they easily settled. An "infamous" case between what would normally be considered northern European countries with clear rules and agreements, is Netherlands and Denmark. A slaughterhouse in Denmark needed extra workers and contracted to a Dutch company to provide them. According to Dutch law, which is clear in the matter, these men were employees of the Dutch company and they paid Dutch taxes on their salaries. They all live in Netherlands, so seems straight-forward.

But the Danish authorities are demanding income tax as well, claiming that they are de facto employees of the slaughterhouse in Denmark, as the management of the slaughterhouse issued their day to day work duties and regulated their working hours etc(!)

This has been going on for YEARS with no settlement, because both countries are sticking to their rules and will not negotiate. In the meantime, the Danes have attacked the only target available to them---the Danish slaughterhouse, and demanded penalties for not withholding income tax. Of course, they defend themselves by saying that they never hired these men, but signed a contract with another company. So the battle goes on.

EU is not helping, national laws are not helping and at the end of the day, the Dutch workers will not be earning in Denmark, the slaughterhouse may not be able to process what they can sell, due to lack of skilled workers, and the net result is a system-wide loss. But explain that to a desk-jockey in the Danish tax office. :ugh:

Aviation-wise, I was offered a Jersey contract, when I was later wrongfully dismissed, neither the Jersey Labour Tribunal, nor the legal system in the aircraft registered country would hear my case. So as far as I am concerned, EU including the JAA/EASA nightmare is a waste of time and money. I have to admit that there has been no major European war since 1945, so the primary objective of keeping Germany in check seems to have worked so far.

Other than that, which might have been accomplished in other ways, having non-elected technocrats and office geeks running our lives on all too many levels has been a very high price. How can it be that disgraced and elected politicians that get removed from national politics, always seem to end up in some high-paying position in EU?

Amazing.....

[A and C]

I will deal with your misunderstandings in order:-

The Social tax issue has a ten year phase in time so the Italian demand for these taxes to be paid in Italy is not going to happen overnight as long as the people are paying the social taxes in the EU state in which they reside. The link below from the UK tax authorities might help you with this.

HM Revenue & Customs: National Insurance: New EU rules for flight and cabin crew working in two or more Member States (http://www.hmrc.gov.uk/news/news220612.htm)

If you read the EU directive you will see that if your Home Base is changes frequently you can apply to have the social taxes paid in you state of residence and NOT at the home base state, I would think that a lot of people in Ryanair would fall into this category.

I am very sorry to say that as of a few weeks ago the French were still not giving my friend any access to the social security system dispite having paid all the taxes due as a resident of France for the last 25 years,unless something has changed in the last month or so this is not as you say bull****....... It is fact.

On the matter of EU states getting their act together on income tax I refer you to the post above about the Dutch workers in the Danish salaughter house.

The answer to the question is very much in the second paragraph above, in theory the EU state should pay out Pensions and the like if you have paid the taxes but with the current state of the southern europan economy's what do you think the chances of getting your full entitlement are when you are living and trying to claim your money from the other end of Europe......... Or to put it another way if you lived in Sweden and were based in Athens were would you want to pay the money that will keep you in your retirement ?

These governments know that the cost of taking them to court and the time it would take to get the money due from them is prohibitive, in other words you will run out of money for the leagal action or die before the case gets to the European court.