As some of you may already be aware, the Irish government recently announced changes to the taxation treatment of flight crew effective from 1 January 2022.

This means in simple terms that non-Irish resident flight crew (including contract pilots) will be exempt from the scope of Irish Income tax from this date.  This will not affect Irish and UK based or Irish/UK tax resident pilots.

Payroll with-holding taxes must now be paid in the country of your home base/tax residency country.

We are working both in house and with our partners across Europe to ensure the new payroll & expense procedures will be in place for the first payroll of 2022.

We will let you know in due course if there are any steps that contract pilots must take in relation to this change, however we are confident all is in hand for this change and it is unlikely any additional information will be required from you.

UK Nationals:

All UK nationals that now fall into tax residency in an EU country are required to obtain a Visa or Work Permit, in order to work and register for taxes in that country.  This is your own responsibility to ensure the correct visa/work permit is in place in sufficient time.  Anyone falling into this category, will be contacted on an individual basis.

Expenses:

The Irish allowable expenses & Subsistence rates will no longer be available to contract pilots who are exempt from the Irish tax system.  Instead, we will be putting in place an expense system relevant to the country where your taxes are being paid.  This is currently in progress and we will update you nearer the time as to what expenses can be claimed in your individual tax country.

We will be adding information for each country to our knowledge base over the coming weeks and you will be notified when information is available.

Remaining Irish unused expenses:

Any unused allowable Irish expenses as of 30^th November, 2021, will remain in the director’s loan account in your Irish LTD. Your Irish LTD will endeavour to repay these expenses to you as soon as possible.  This will depend on which country you will be paying local taxes in and we will discuss the significant tax advantages available with pilots on an individual basis as each case may differ.

Please note that expenses are only valid for a 4 year period from the date of expense incurred. 

EWSS:

The scheme has been extended to April, 2022 but from December 2021, the rate will be significantly reduced by at least 50%.  In the final phase of the EWSS (March to April 2022) the rate will be reduced to a flat rate subsidy for those eligible of €100 per week. 

If your company remains eligible, then we will continue to support and run an Irish payroll to ensure you receive this subsidy which will not be classed as flight pay.

Any individual queries regarding the above should be sent to support@oconnorandassociates.ie and we will endeavour to answer your queries in the quickest possible time depending on the volume of queries.