Advocaten / Avocats / Lawyers

Home>News>How high is the tax pressure in the cockpit?

Friday, 15 November 2019

How high is the tax pressure in the cockpit?

Tax affairs

International tax law has specific rules for airline staff. Contrary to what the title of this article may suggest, these special provisions not only apply to pilots and co-pilots, but also to the flight crew and cabin crew.

Unlike the situation for ‘ordinary’ employees, Article 15(3) of the international double taxation conventions usually stipulates that flight crew and cabin crew working on board a plane operating in international airspace traffic are taxed in the country where the actual management of the company operating the aircraft is based (double taxation conventions based on the old OECD Model Tax Convention).

A Belgian pilot working on board an aircraft active in international airspace, for an airline with its effective management based in Germany will in principle be liable for income tax in Germany.

In this example, the pilot must declare his or her global income in Belgium. If Germany (the country in which the company’s effective management is based) has tax jurisdiction, Belgium will grant double taxation relief based on the exemption method (with progression).

The above can be fiscally advantageous if the tax burden in the country of establishment concerned (in our example, Germany) is lower than in Belgium.

In practice, it is nevertheless not always simple to determine where the airline’s effective management is based, in particular if the operational management is based in a country other than that where the head office or the cabin crew’s (formal) employer is based. In addition, it is always necessary to check whether the various conditions for the application of Article 15(3) have actually been met. If the specific regulations for airline crew are not applicable, the standard employee allocation provisions determine which country has tax jurisdiction (Article 15(1) and (2) international double taxation convention).

Please note that the more recent double tax treaties (double tax treaties based on the 2017 OECD Model Tax Convention) provide a new regulation in Article 15(3) in the sense that the country of residence of the crew member currently has tax jurisdiction as a matter of principle. However, most double taxation conventions in force are currently still based on the old OECD Model Tax Convention.

Social security

Within the EU, the determining factor for flight crew and cabin crew since 2012 pursuant to Regulation 883/04 is their home base. The home base is the place where flight crew and cabin crew usually start and end their service schedule and where the company is not responsible for the crew’s accommodation.

A pilot living in Belgium flying for an airline based in Germany who normally starts and ends his or her service schedule in Paris must take out social security insurance in France.

If the pilot lives in Belgium but works outside the EU and if the aforementioned regulation is not applicable (which depends on the circumstances), it will depend on the bilateral social security agreement, or, in the absence of one, the national social security legislation.

What about the crew on a vessel in international waters?

Seafarers in service in principle fall under the same international tax rules as cabin crew. Here too, the starting principle in most double taxation conventions is that the country with tax jurisdiction is that in which the effective management of the company that operates the ship is based.

The rules differ with regard to social security. The deciding factor is the flag the vessel is flying. If the vessel is flying an EU flag, the social security applicable is in principle that of the relevant Member State, but there are exceptions (European Regulation 883/2004).

Even if the vessel does not fly an EU flag, Regulation 883/2004 may apply if the employee lives in a different Member State than the one in which his or her employer is based. The European Court of Justice (ECJ-631/17 of 8 May 2019) recently ruled that employees are subject to the social security regime of their state of residence.

If Regulation 883/2004 is not applicable, bilateral social security treaties and national social security legislation provide different rules.


It is apparent from the above that establishing the correct tax and social security consequences of income earned by pilots and seafarers forms a fascinating but complex subject. The complexity of this topic makes it clearly necessary to seek expert advice. We are delighted to provide our assistance.

Katrien Bollen - Senior Associate (

Laurine Vanherck - Associate (

Tiberghien Brussels

Tour & Taxis

Havenlaan|Avenue du Port 86C B.419
BE-1000 Brussels

T +32 2 773 40 00

F +32 2 773 40 55

Tiberghien Antwerp

Grotesteenweg 214 B.4
BE-2600 Antwerp

T +32 3 443 20 00

F +32 3 443 20 20

Tiberghien Ghent

Esplanade Oscar Van de Voorde 1
BE-9000 Gent

T +32 9 216 18 00

Tiberghien Hasselt

Torenplein 7 B13.1
BE-3500 Hasselt

T +32 11 57 00 13

Tiberghien Luxembourg

23, Boulevard Joseph II
LU-1840 Luxembourg

T +352 27 47 51 11

F +352 28 66 96 58