Lakshya raj khatri
Eugenio Pescimoro
PROLOY TARAN DAS
Taxation Shall NOT Be...
34 Comments
Dear Osman,
Thanks for raising the issue in Trento, well done. You give quite appropriate comments to the answers you got.
Regarding answer 4, the Horizon 2020 documentation (I think in the guide for applicants, but I would need to check this) says now that some countries may tax the mobility allowance (this information did not appear in the documentations for the IEF calls 2011 and 2013). Great, how about letting us know which countries? We might not want to apply there.
I am going to raise the issue of the taxes on the mobility allowance next Monday with the president of the European Research Council, he is holding a meeting with representatives of Scottish universities, I will represent mine.
Could we do something bigger and more official? Like a petition signed by many of us or something similar? Do you have any idea?
Ciao,
Maria Paola
Hi all
what does it actually mean that NOW the mobility allowance is not subject to tax (as per Luchetti's reply to Osman). Does this apply to the current holders?
Here in UK the mobility allowance has been subject to tax (for sure for the IEF calls 2011 and 2013).
Hi All,
I read your comments on this very important issue that you raised. Thanks for all your inputs and ideas!!
I noticed that several times was mentioned here if we (the MCAA) could do something more formal and official. In addition to your initiatives, I can propose several ideas of what we can do officially regarding this matter, to influence policy and national/institutional practices:
1) We can write a policy paper and address it to the EC. I understand that the Commission has limited possibilities to directly interfer with national practices, but there are probably number of issue which can be addressed. For example we can ask for:
- precise information about tax issues in different countries
- closer cooperation with network of NCP's regarding this matter
- to have this issue (that mobility allowances shell NOT be taxed) more visible and better communicated to the national and institutional authorities,
- help us defiine a set of activitities (a legal procedure) which individual members can take in order to achieve their rights within institutions in different countries.
2) We can write a public statement and recommendations, where, for example, we can present our position, ask for mobility allowances to be exempt from taxation and appeal on national and institutional authorities to respect this right;
3) Additionally, we may take action to inform new members on their right as soon as they join the association, by sending this info alongside the 'Welcome to the MCAA' greeting;
4) Cooperation with Euraxess could be also useful.
Certainly, cooperation with our Policy for Successful Researchers working group will be crucial.
These were only a few ideas based on my experience with policy matters. Your discussions, ideas and inputs are very important for better understanding of the whole matter and formulating policies.
I wish fruitful conference and nice time to the MCAA members in Trento! I wish I could be with all of you!
Snezana
MCAA Chair
Hi Snezana,
I find your points very good, I think we should do them!
The European Commission has limited possibilities to interfere with national practices, but could it require that only those countries which do not taxate the mobility allowance are allowed to host Marie Curie fellows? Would not the EU countries then have an interest in changing their legislation in our favour, since we bring research, work and taxes to them?
Ciao,
Maria Paola
Dear All,
It is a very interesting topic that you all have raised, and I think Snezana's idea is a good way to go further about it. As most of us do not know the tax laws of the countries where we apply, it becomes impposible to know that how much net salary are we supposed to get in the end. Mobility allowance certainly shall not be subjected to tax, as far as my understanding of the maraie curie financial guidlines goes. But I was told that as per croatian laws it is not possible to give these allowances in hand without any taxation, the other way proposed to me was not to include the mobility allowance in my salary and produce bills and get reimbursed from the mobility fund.
I would prefer not to pay any tax on the mobility fund as well, but ofcourse in the limits of the national laws. So as snezana suggested , it will be a good idea if MC authorities can make us aware of of our tax liabilities. Please let me know what can I contribute to proceed with this idea.
Thanks
Gaurav
Hi,
could we ask that the mobility allowance is paid to the fellows directly by the European Union? So that local government cannot tax it?
I am writing an e-mail with my issue for the President of the European Research Council, whom I will meet on Monday, and I wanted to suggest this solution in case local governments want to tax the mobility allowance.
What do you think of this solution?
Ciao,
Maria Paola
Hi,
I just sent this e-mail to request to discuss the mobility allowance taxation issue next Monday at a meeting with Professor Bourguignon, President of the European Research Council, and representatives of the Scottish universities.
I hope this will help.
Ciao,
Maria Paola
P.s.: See the e-mail below.
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Dear Dr. Marriot, dear University Representatives,
my name is Maria Paola Bissiri and I am Marie Curie research fellow at the Queen Margaret University of Edinburgh. Previously I held Marie Curie fellowships at the Technical University of Dresden and at the Charles University in Prague.
At the meeting with Professor Bourguignon I would like to raise the issue of the taxation of the mobility allowance for Marie Curie research fellows.
The mobility allowance is a contribution to the mobility expenses of the researchers, since Marie Curie fellowships require that researchers move from one European country to another. The mobility allowance is meant to be tax free according to the European Commission. However, in several European countries, such as the UK, the mobility allowance is taxed. It also happens that in the same European country in some host institutions the fellows receive the mobility allowance taxed while in other host institutions they receive it tax free. This happens for instance in Germany, where the mobility allowance should be tax free also according to the federal law on income tax.
We have been discussing these issues with several Marie Curie fellows, members of the Marie Curie Alumni Association: https://www.mariecuriealumni.eu/
In name of all Marie Curie fellows who have troubles discussing the taxation of the mobility allowance with their host institutions and have to spend time and effort on this, while they should dedicate this time and effort to research, I request that the European Commission demands that the mobility allowance is tax free in all European Union countries. If a specific country does not want to allow this, the allowance should be paid to fellows hosted in that country directly by the European Union.
I would appreciate any help and suggestion by Professor Bourguignon and by the University Representatives on this issue.
Kind regards,
Maria Paola Bissiri
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Maria thank you for your time and effort on the issue.
Ciao
Cigdem
Ciao,
Maria Paola
Hi;
I'll start on 1 Octubre 2015 with an IEF2013 in iBET (Oeiras, Portugal). I have recently received a simulation of my future salary; Both living allowance as mobility allowance have taxation (33% !!!!) and reduction of Social Security (11% !!!). In summary, Portugal have a correction factor of 0,85... a first reduction of 23,7% Employers’ Social Security Contribution.... and the Gross salary have a taxation+SS of 44%...
Net Salary per month (+-) 2,028.33 x12... I think that this taxation is opposite to Marie Curie Fellowship programme. I'm totally agree with this fight for our rights.
Bye
Dear all,
It is obvious that the taxation is a serious issue for all of us. I heard that even in the same institution there are tax-free fellows and all-taxed fellows. Their net incomes differ by almost 50%! I also had to travel as much as I can in order to avoid taxes on the mobility allowance.
I also noticed that the Marie Curie division of EC does not have any intention to be involved. They are just not accessible whenever you need them.
I see Manuel Barrose more than the middle-managers at EC. I am sure if he was aware of these issues, he would have ordered it to be solved. Why do not we write a simple two page letter that directly adresses him? Or maybe we can write an open letter that adresses everyone and inform media about i?
Sorry, I just learned that the new president of European Commission is Jean-Claude Juncker. Maybe we can write him a welcome letter along with an attachment on tax issues.
Hi Osman,
we could write a letter to Barroso and to Juncker, good idea. I think a personal letter to each one of them is better: if people are addressed personally, they feel more responsible and are more likely to react. We can also write an open letter in addition, why not.
Barroso and Juncker are surely extremely busy people, so I think we should keep it short and incisive, and we should capture their attention.
Would someone like to write the letter? We could also adapt the e-mail I wrote for the meeting with the ERC President. Of course anyone is more than welcome to reformulate a letter.
Let's do something. We don't need that much time for this.
Snezana, it would be great if you, as MCAA chair, would send the letters in name of all of us. Or several of us could sign it together with you.
Ciao,
Maria Paola
Hello to everyone,
Maybe mine will be not a popular opinion, but as I understand your salaries partially come from the tax money of other people. Why not also give an opportunity to someone else in the future to have this kind of scholarship from your tax money?
Hi Maryia,
all opinions are welcome, even the unpopular ones.
Someone else cannot have this kind of scholarship from our tax money, because all taxes are kept by the local governments, it is not money coming back to the EU to finance more scholarships.
The EU allocates money to pay our salaries, from which we pay taxes as any other person working in that European country. But there is one difference from the local employees in that country: in our case employer's deductions are paid from the EU money not by the employer. This is very convenient for the governments hosting us: we are completely free of charge for the employer.
The EU also allocates money to pay our mobility expenses, the mobility allowance, because mobility is required by our fellowship and, by the way, it is also a milestone of the program. The mobility allowance is meant to be tax free, because it is an expenses contribution. The local governments take advantage of us, taxing it, but they should not.
Ciao,
Maria Paola
@Maryia : Thanks for your comment but I don't agree with you. Of course we should pay taxes as we are holding all a "working contract" and not a "scholarship"! However, I prefer that the things are done in the correct manner and are equal for all fellows. If you have followed a little bit, you may see that even fellows from the same country had faced different conditions.This is not acceptable! That's why our aim should be to reduce all the differences among fellows.
In my opinion the contracts should be controlled and checked by the E.Commission. Yes we have the top conditions but once the E. Commission transfers the money to the institutions it seems that they don't care about the practice. For example; mobility allowance taxation, the language of the contract, the employer and employee contributions... Maybe in the future they may establish a new department which only takes care about these issues.
@Maria Paola, Snezana and Osman : I really liked the idea to write a letter. I would like to contribute as much as I can, specially sharing my own experience. Maybe we can exchange via this portal some drafts and then decide how and to whom send it.
Best regards,
Zeynep
Dear Maria,
You brought forward an interesting topic about employers contribution, I understand that the employers contribution in our case shall be paid from th marie curie fund. But does this mean it has to be deducted from the fund allocated for my salary? because in my case the gross salry in my conract is different from my gross in my pay slip, when I asked, I was told that the employer's contribution had to be deducted and my "real gross" is after that deduction. is that the same in everybody's case
Best
Gaurav
Dear Gaurav,
all contributions, encluding employer's contributions, shall be paid from the allocated living allowance. This is stated in the Work Programme and Guide for Applicants of the Marie Curie IEF fellowships.
In the Grant Agreement my host institution signed with the European Commission it says that my contract should indicate the amounts I am entitled to receive, thus the living and mobility allowances, the deductions from it and the top ups by the university (if applicable). So, in my opinion the contract should state the monthly amounts of the living and mobility allowances, indicating that employer's deductions will be applied to it in order to obtain my gross salary. My contract of employment in Germany was like that. You can check in your contract if this also your case.
In my opinion in our case the pay slip should also contain employer's deductions. It is not necessary to include them in the payslips of the other employees since in their case these deductions are paid by the employer and do not affect the employee's gross salary. In our case they do, so they should appear in the payslip together with the amount of the monthly living allowance.
Employer's deductions appeared in my payslips in Germany, but do not appear in my payslips in the UK. Thus I requested my UK University to insert them. It is very unusual for them since I am the first ever Marie Curie fellow in this university, so I heard from my supervisor that the Human Resources wanted to consult another university with experience with Marie Curie grants. Let's see what they will say, I am waiting for an answer.
Ciao,
Maria Paola
Just to clarify. The employer's gross salary would be the living allowance, while the employee's gross salary consists in the living allowance minus employer's deductions. This is what in the UK they call gross salary. So this is probably what they mean when they say this is your "real" gross salary.
Since employer's deductions all come from our fellowship, in my opinion the payslip should state these employer's deductions transparently. Otherwise, how could we know if we are paid correctly?
Another thing worth mentioning is that employer's deductions can vary over time. This does not affect the other employee's salary, but it does affect ours since these deductions in our case are paid from our fellowship. Therefore transparency in the contract and in the payslip is important.
Ciao,
Maria Paola
Hi all
I also fought very hard not to be taxed on my mobility allowance here in Spain, but as many of you, i was unsuccessfull... the manager of my institution talked to many people in managment, and the bottom line is that in Spain it must be taxated (as in most of EU countries), because if not, many companies would just pay half of the salaries to their employees as "mobility allowance", hence the company and the worker would be escaping taxes...
This means that the problem can only be solved by some sort of special exception to the law by individual govenments, or by central EU... and i'm not seing this as a major problem for them, because MC fellows are a very small minority in EU, so its a tricky situation...
Anyway, i leave my support to who is fighting for this!
Cheers
Hi,
First of all, thank you for raising this issue, Osman, and for mentioning it to the President of the European Research Council, Maria!
Snezana, it would be great if you could indeed discuss it with the Board, thank you in advance for your time.
The same happened here in Valencia, the MA is taxed. The responsible of the European Research Projects' Office- OPER (Oficina de Projectes Europeus de Recerca)- from the University told us this taxation was madatory according to: "the modifications made in article 109 of the Spanish General Law of the Social Security as per Royal Decree-Law 16/2013 of 20 December"...
But I also find it strange that the mobility allowances should be taxed, as they were meant to not be taxed, and are meant to cover the expenses of the researchers living abroad (money used to pay back expenses is usually never taxed, at least in Europe).
It is even stranger that different countries of the EU should apply - or not- different taxation rates on this mobility allowance. This implies that some countries are taking more or less money than others from the European Comission via the mobility allowances of researchers. How come the EC is not regulating this indirect funding?
Pedro, that's a good idea, let's create a poll on the Spain-Portugal Chapter, in order to collect data on how many people are taxed on the MA in this region.
Cheers,
Nadine
PS: colleagues from the Netherlands are also taxed on their mobility allowances.
I just brought about the issue of the taxation of the mobility allowance at the meeting with the President of the European Research Council, Professor Bourguignon, and representatives of all Scttish universities, mostly deans and vice-deans.
Professor Bourguignon agrees that the mobility allowance shall not be taxed. He said he will bring about the issue with the European Commission, he gave me his card and said I should write to him about this. He totally agreed that this situation, with even disparity of treatment among the fellows in the same country, shall not be.
Similar reactions came from the university representatives. Some were convinced that the mobility allowance is not taxed in the UK...
One step forward, let's keep going this way. :-)
Maria Paola
Hi Maria;
Good work, thank for your efforts. How can we help you?. I have a document with a simulation of my future salary in Portugal... Mobility allowance will be subjected to a reduction of 44%, from 595 Euros to 333 every month... is ridiculous. I can share this document with you. Also, If you want I can open a new post in Spain-Portugal chapter in order to analyse differences between institutions in these countries. Ok?
Thank you again
Yes, thanks Maria for your letter proposal and for sending that email as also to Snezana for incorporating this topic in the meetings you attend.
It is surprising, and somehow encouraging, that many of us are in such situation so we may be able to change it.
I'm sure many more people would participate in a joint letter, so I'm IN if you need support, and it may be useful, as Pedro suggested in his post at the "Spain-Portugal chapter" to add our present experiences on MA taxation as follows:
Fellowship > Country > Institution > % taxation (IRS or IRPF) +SS > Is this applied to MA? Yes/No/only one part > Gross MA/month > Net MA/month
His case IEF2013 > Portugal > iBET > 33%+11% > Yes > 595 euros > 333,2 euros
My case:
ESR/ITN2013 > Croatia > IOF > 50.9% > Yes (exactly same as for salary) > 581 € > 285.2 €
Whoever wants to join...
consider my support too
Hi Maria,
This is a great news, thanks a lot for all your efforts. We can also write a letter to EC on behalf of the association and ask for information, help and solution. As Zeynep proposed, I am also finding that it is good idea to share the draft letter via this portal, as interested members could contribute.
In meantime, I think that it is crucial that we have as much evidence as possible. Frankly, I was surprised to read how many members have their mobility allowances taxed - according to the comments, it seems majority. Therefore, I am finding that in this moment is very important to identify members (and their countries) whose mobility allowances are (or were) NOT taxed. This will serve as a very good starting point, eveidence and legal ground. Help of Chapters in regard to this matter will be also very welcome.
Additionally, I am planning to discuss these issues with the Board / ExCom at our meetings.
Snezana
Hi Snezana, hi everybody,
I wrote Prof. Bourguignon, President of the European Research Council, to remind him about our meeting and the issue of the taxation of the mobility allowance. He said he would bring up the issue in Bruxelles.
Snezana,
shall we prepare a draft for the letter to the EC on behalf of the association? Something incisive and effective (not too long). I could try to put down a draft as soon as I have time, basing on the e-mail I sent to the ERC president.
Ciao,
Maria Paola
My mobility in Italy was also taxed, actually along with the funds for conference participation, due to administrative issues everything was put together and taxed, and because it was a great amount also the % for taxes was higher. But on the other hand I had a self employed contract and thus not paying for social security and pension (this I paid afterwards retroactively in Romania for the minumum salary) so after all I got more than if having a dependant work contract with proper taxes.
...
Thanks Antonia, this is indeed a very useful example and it can serve as a role model for other Spanish (or regional) universities.
Idetifying examples of good practices is very important, not only with aim to be promoted, but also to show the way on how to improve the situation of the MCAA fellows. They will be important for our policy papers and recomendations.
The last week we had the Executive Committee meeting and despite very busy agenda, we succeeded to discuss this matter as well. We found that it would be the best way to support development of policy paper in cooperation with the Policy for Successful Researchers working group. In meantime, please keep identifying good practices. As far as I remember, we have identified 2 positive cases, in Germany and Spain.
In general, we encourage the work on the MCAA members on different policies relevant for researchers.
Best wishes,
Snezana
Just to clarify that the case of Girona has changed for the Horizon 2020 calls. They were the only institution in Spain doing this and they stopped. The mobility allowance is now added to the livig allowance and taxed with social security contribution (from the company and the employee) and income tax.
How about getting the mobility allowance tax free through receipt refunds? If these do not cover the whole amount of the mobility allowance, we should get the rest anyway because the host institution must pay the whole allowance to the researcher! We might get the rest taxed but we would have paid less taxes.
Check this out:
https://www.mariecuriealumni.eu/posts/mobility-allowance-receipts-and-then-rest-taxed
What do you think about it?
Ciao,
Maria Paola
Concerning taxes, everyone should look at the following:
"doppelbesteuerungsabkommen YourCountryNow - TheCountryYouLivedBefore". There should be an equivalent document in your own language ("double taxation convention" in english, "convenio de doble imposición" in spanish, ...)
For example, the one Germany-Spain:
http://steuern-spanien.com/wp-content/uploads/2012/04/doppelbesteuerungsabkommen-brd-spanien.pdf
article 19.2 says that if you are phd student, and lived before in Spain, Germany can not tax any of your incomes (you have to fight to convince them about this). you just pay the insurances. This depends on the treaty with each particular country. For germany-france, sth equivalent is e.g. in article 17.
Hi all from Trento. I am currently at the Marie Sklodowska Curie Conference at Trento University. I raised the taxation question to Alessandra Luchetti, who is the head of the Marie Sklodowska Actions Unit at European Commission. Here is her comments in quotes and mine in paranthesis:
1 - "I received this question many times before." (Why do not you do anything about it?)
2 - "We pay top money to researchers." (I wonder how much she earns, what are her qualifications, and what kind of researchers she is talking about.)
3 - "We cannot do anything about it." (Why do you hold this position if you cannot do anything about it?)
4 - "At least now the mobility allowance is NOT subject to tax." (This is good! I wish you let everyone know about it!!!)
So, all in all, European Commission does not have any intention to get involved with the tax issues unless we keep rising this issue at any level until they see it as a big problem! Also, mobility allowance is NOT and should NOT be subject to taxation.
Please raise this issue as much as you can at any opportunity. After all European Commission is funded by public taxes and shall respond to your concerns.
For those whose allowance is taxed; you better fight for your rights. Mobility allowance SHOULD NOT be subject to taxation as per the EC Guidelines!