Airline employees in tax squeeze

Scandinavian Airlines employees living abroad have sued the tax ministry over their having to pay up to 90 percent in total taxes to two countries Several Danish pilots and cabin crew members employed by Scandinavian Airlines (SAS) have sued the...

Several Danish pilots and cabin crew members employed by Scandinavian Airlines (SAS) have sued the tax ministry because they are being required to pay taxes at home and in their country of temporary residence.

Due to a law that took effect on 1 January some of the airline’s employees, particularly those living in Spain and France, are being hit with a total income tax rate of 90 percent.

The ministry’s revised laws pertaining to foreign-earned income require employees to pay tax in Denmark if they work for a business based in this country.

But the issue became heated in May when SAS moved many of its primary operations to Stockholm as part of its administrative restructuring.

SAS management backs the employees on the issue and attempted to get Danish tax authority SKAT to put a temporary freeze on any tax payments until the matter was settled. But the authority refused, saying the issue will be addressed by all three Scandinavian countries’ tax officials in August.

Pilot Mark Jensen, one of the 65 employees who have a stake in the lawsuit against the ministry, said paying the extra tax has forced him to take out an additional loan to pay his mortgage.

Frode Holm, the attorney handling the SAS employees’ case, said he has no doubt that his clients’ claim is valid.

‘Denmark cannot require taxes from people living in Spain or France and with a Swedish employer.’

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