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I know some formites put up Micheal O Leary as someone they wish was running the country...
personally I think he symbolizes the corporate greed that has got us into this mess in the first place....
Make what you will of this article...
Ryanair pays less tax than boss O'Leary
Sunday August 19 2007
DESPITE earning almost 1.6bn profits over the past five years, Ryanair has paid just 11.6m in tax over the period, the Sunday Independent can reveal. This represents an effective tax rate of less than one per cent.
Four years ago, Ryanair boss Michael O'Leary announced that he had paid personal tax of 14m for the year. He tried to present a giant cheque for the amount payable to "dithering Bertie".
In the five years to last March, Ryanair earned total pre-tax profits of almost 1.6bn. According to its profits and loss accounts, the total tax due for this period was 142.6bn. When a tax write-back of 34.2m last year is deducted,the total falls to just 108.4m. That represents a tax rate of just 6.8 per cent.
Low as it may seem, this actually seriously exaggerates the amount of tax Ryanair paid. If one examines their cashflow statements the amount of cash paid over the five years was 11.6m, a mere 0.73 per cent of profits.
How does Ryanair keep its rate so low? Part of the explanation is due to the fact that it keeps spending huge amounts of money on new planes. Last year's capital expenditure, most of which went on aircraft, was 494m. Ryanair's capital expenditure over the past five years was 2.46bn.
Under Ireland's corporation tax regime, plant and machinery, including aircraft, can be written off over an eight year period. Ryanair had an average of just over 2.7bn property, plant and machinery on its books last year. Even if the 12.5 per cent annual capital allowance was allowable against the full amount that would still knock only 338m off Ryanair's taxable profits.
This would reduce Ryanair's taxable profits from 451m to 113m. However, that should still have resulted in Ryanair paying 14.1m in tax. In fact, although the airline provided for a 49.6m tax bill in its profit and loss account, it actually paid just 5.2m.
Capital allowances on new aircraft are only part of the method Ryanair uses to reduce its tax bill to a pittance. While Ireland doesn't allow firms to front-load capital allowances, other countries are more accommodating.
Analysts reckon that many Ryanair aircraft are owned by subsidiary companies based in tax havens such as Cyprus. The aircraft are then leased back to an Irish operating company. By structuring the ownership of its aircraft in this way Ryanair is able to avail of other countries' front-loaded capital allowances.
Ryanair is also believed to have structured the ownership of its online ticket sales operation in a way that minimises its tax bill. This is understood to be owned by a Channel Islands-registered company, which then charges the parent company a commission for every ticket sold.
There is also evidence that Ryanair has been consistently over-estimating the tax liability it records in its profit and loss account. The most recent set of Ryanair accounts include a 34.2m write-back of tax which had been over-provided for in previous years. Add it all up and the Ryanair tax bill shrinks to not more than the price of one its bargain basement airfares.
Ryanair did not respond to detailed queries about its tax payments last week.
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personally I think he symbolizes the corporate greed that has got us into this mess in the first place....
Make what you will of this article...
Ryanair pays less tax than boss O'Leary
Sunday August 19 2007
DESPITE earning almost 1.6bn profits over the past five years, Ryanair has paid just 11.6m in tax over the period, the Sunday Independent can reveal. This represents an effective tax rate of less than one per cent.
Four years ago, Ryanair boss Michael O'Leary announced that he had paid personal tax of 14m for the year. He tried to present a giant cheque for the amount payable to "dithering Bertie".
In the five years to last March, Ryanair earned total pre-tax profits of almost 1.6bn. According to its profits and loss accounts, the total tax due for this period was 142.6bn. When a tax write-back of 34.2m last year is deducted,the total falls to just 108.4m. That represents a tax rate of just 6.8 per cent.
Low as it may seem, this actually seriously exaggerates the amount of tax Ryanair paid. If one examines their cashflow statements the amount of cash paid over the five years was 11.6m, a mere 0.73 per cent of profits.
How does Ryanair keep its rate so low? Part of the explanation is due to the fact that it keeps spending huge amounts of money on new planes. Last year's capital expenditure, most of which went on aircraft, was 494m. Ryanair's capital expenditure over the past five years was 2.46bn.
Under Ireland's corporation tax regime, plant and machinery, including aircraft, can be written off over an eight year period. Ryanair had an average of just over 2.7bn property, plant and machinery on its books last year. Even if the 12.5 per cent annual capital allowance was allowable against the full amount that would still knock only 338m off Ryanair's taxable profits.
This would reduce Ryanair's taxable profits from 451m to 113m. However, that should still have resulted in Ryanair paying 14.1m in tax. In fact, although the airline provided for a 49.6m tax bill in its profit and loss account, it actually paid just 5.2m.
Capital allowances on new aircraft are only part of the method Ryanair uses to reduce its tax bill to a pittance. While Ireland doesn't allow firms to front-load capital allowances, other countries are more accommodating.
Analysts reckon that many Ryanair aircraft are owned by subsidiary companies based in tax havens such as Cyprus. The aircraft are then leased back to an Irish operating company. By structuring the ownership of its aircraft in this way Ryanair is able to avail of other countries' front-loaded capital allowances.
Ryanair is also believed to have structured the ownership of its online ticket sales operation in a way that minimises its tax bill. This is understood to be owned by a Channel Islands-registered company, which then charges the parent company a commission for every ticket sold.
There is also evidence that Ryanair has been consistently over-estimating the tax liability it records in its profit and loss account. The most recent set of Ryanair accounts include a 34.2m write-back of tax which had been over-provided for in previous years. Add it all up and the Ryanair tax bill shrinks to not more than the price of one its bargain basement airfares.
Ryanair did not respond to detailed queries about its tax payments last week.
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Is there something wrong with avoiding tax where possible?
Exactly why is this tubbsy?
I suggest that you have a read of the historical Duke of Westminister case which deals with tax affairs. As it states in that case or something similar "No man is under any obligation to structure his affairs so that he pays the most amount of tax possible". If someone is legally using the tax legislation to structure his tax affairs, then there is nothing wrong with that?
Obviously evasion is a different matter and that is why it is punished accordingly.
I suggest that you have a read of the historical Duke of Westminister case which deals with tax affairs. As it states in that case or something similar "No man is under any obligation to structure his affairs so that he pays the most amount of tax possible". If someone is legally using the tax legislation to structure his tax affairs, then there is nothing wrong with that?
Obviously evasion is a different matter and that is why it is punished accordingly.
DV, I agree with tubbsy here. I understand you are taking the "legal loophole is still legal" route, but for the ordinary working folk its sickening to see the super rich escape tax by "living" in a tax-free haven. I know we can't touch them, but in a fairer world they would pay same as the rest of us!
I agree that they should be taxed downallstar, but the point is that the government should change the legslation so as to catch these people rather than somehow relying on the conscience of the individual concerned. If he tax law was changed so that an Irish domiciled individual was taxed on his world wide income then it was catch all of our high profile offshore persons. Domicile is practically impossible to change so they would not get of it by movng offshore and benefitting from the residence and ordinary resident rules that are currently in place
sad thing is that those escaping it can easily afford it !
I suspect that there will be a coordinated effort among many countries to do away with these tax havens and it is about time. Bono is lauded for his third world work, JP McManus hands some money oer to Limerick GAA clubs and he is a hero. It is a joke and these lads should be paying their share. It will be interesting to see how often JP visits this year with the new residence rules that are now in place. His racecourse appearance will be much reduced as he simply cannot jet off before midnight consistently and avoid residence status.
owns horses yet ups prices for chelt week joker
The biggest crooks in this country and most others are those in suits who hide behind and use the law at the expense of what should be moral.
A lot of bankers in this present climate should have all their assets stripped and/or put in jail.
Governments say we cant do that as the banks need to be bankrolled inspite of their greed and corruption and if the banks fail everyone will suffer. I say i would rather stand in line at a soup kitchen if it meant these gangsters with no morals were standing behind me.
Mc Manus and Bono should have their Irish citizenship taken away.
A lot of bankers in this present climate should have all their assets stripped and/or put in jail.
Governments say we cant do that as the banks need to be bankrolled inspite of their greed and corruption and if the banks fail everyone will suffer. I say i would rather stand in line at a soup kitchen if it meant these gangsters with no morals were standing behind me.
Mc Manus and Bono should have their Irish citizenship taken away.
I think a good question to ask people like JP Mc Manus and Lewis Hamilton is what can they buy with 500 million that they cant buy with 50 million.
what can they buy with 500 million that they cant buy with 50 million
Allied Irish Bank
Allied Irish Bank
Typical Irish begrudery......................dont blame the man for making his company as profitable as he can by availing of tax legislation brought in by the government. Its his job to look after his company, its the governments job to look after theirs
I would rather see 100m go back into ryanair than into the govt coffers. Who do you believe makes better use of it in terms of reinvestment and job creation?
I would rather see 100m go back into ryanair than into the govt coffers. Who do you believe makes better use of it in terms of reinvestment and job creation?
If the Govt had spent the money as wisely as Ryanair by investing in Capital Projects instead of wasting it on rubbish like the computer system in the Health Service, e-voting mchaines (incl ongoing storage costs) and the like, then we would have proper infrastructure.
There is a difference between tax avoidance (legal) and tax evasion (illegal)
Would you rather Ryanair were flying around in 20-year-old planes
There is a difference between tax avoidance (legal) and tax evasion (illegal)
Would you rather Ryanair were flying around in 20-year-old planes
and the award for the first sensible post on this thread goes to El Gato. O'Leary's primary responsibilities are to his company and his shareholders. Differentiate between Ryanair, the company and Michael O'Leary the taxpayer. It is incumbent on him as MD for Ryanair to always get the best possible deal for that company, and that includes its tax affairs. As far as I know, O'Leary lives in Westmeath and is fully compliant in his own personal tax as outlined in the original article.
Ryanair reduces the air travel bills sunstantially for thousands of companies in this country every year and should be applauded for it
Ryanair reduces the air travel bills sunstantially for thousands of companies in this country every year and should be applauded for it
I agree with most of the posts re Ryanair and the difference between tax compliance and tax evasion ... the company is an example of how to exploit the system and shouldn't be knocked for doing best for its shareholders...
I just thought it was an interesting artical in the times and a good debate starter...
But I do think it shows how easily exploited our tax system can be... and needs review
I do also think the seperation between Micheal O Leary and Ryanair in the publics opinion is negligible and when he pulls a stunt like trying to give an oversized cheque to Bertie it is a deflection from what his companies actual tax returns are.... while good cheap PR... it is cheap
I just thought it was an interesting artical in the times and a good debate starter...
But I do think it shows how easily exploited our tax system can be... and needs review
I do also think the seperation between Micheal O Leary and Ryanair in the publics opinion is negligible and when he pulls a stunt like trying to give an oversized cheque to Bertie it is a deflection from what his companies actual tax returns are.... while good cheap PR... it is cheap
I have made no reference to O'Leary in any of my posts. I have huge admiration for him.
He is a complaint income payer, his company employs huge amounts of staff and is a shining example of successful Irish business.
I direct my dismay at individuals such as McManus who are lorded throughout the country by racing folk etc.
He is a complaint income payer, his company employs huge amounts of staff and is a shining example of successful Irish business.
I direct my dismay at individuals such as McManus who are lorded throughout the country by racing folk etc.
screw them - plenty in the purse does not prevent starvation of the soul- there is a corporate & ethical responsibilty to pay tax
anyway they are loss making in the last 6 months of the year so they wnt be paying tax on anything
anyway they are loss making in the last 6 months of the year so they wnt be paying tax on anything
No matter how much money you have you can still only eat three meals a day. You might live in a fancy house but when all is said and done its still just a pile of bricks.
Extreme wealth such as that of JP Mc Manus and O Leary is nothing which should be looked up to. It should be an obhorence. That these mega rich people are not happy with the extreme monetary riches which they already have but use loopholes to evade tax shows that money can never buy you happiness because if you are always looking even more money than you could possibly need then you can never be content.
Extreme wealth such as that of JP Mc Manus and O Leary is nothing which should be looked up to. It should be an obhorence. That these mega rich people are not happy with the extreme monetary riches which they already have but use loopholes to evade tax shows that money can never buy you happiness because if you are always looking even more money than you could possibly need then you can never be content.
People seem to be referring to the writing-off of capital expenditure over an 8-year period as a tax loophole which it is not.
It is an option available to EVERY single business in Ireland and is a method to ensure that businesses keep their capital items (motor vehicles, equipment etc) up-to-date by ensuring that they get tax relife on same.
If you don't understand the mechanism behind the legislation then it's best not to comment on it.
That's not to say that there hasn't been outrageous legislation passed through our Dail over the last 10 years which did allow for tax avoidance which is grossly unfair to the ordinary taxpayer and could only benefit the big earners (BES schemes, hotel schemes etc etc) but the capital allowances on capital expenditure is not one of them.
It is an option available to EVERY single business in Ireland and is a method to ensure that businesses keep their capital items (motor vehicles, equipment etc) up-to-date by ensuring that they get tax relife on same.
If you don't understand the mechanism behind the legislation then it's best not to comment on it.
That's not to say that there hasn't been outrageous legislation passed through our Dail over the last 10 years which did allow for tax avoidance which is grossly unfair to the ordinary taxpayer and could only benefit the big earners (BES schemes, hotel schemes etc etc) but the capital allowances on capital expenditure is not one of them.
read the article - not all the tax is written off vs capital expenditure
142.6bn seems a lot of tax due on those profits.
listened to this clown saying that over 70% of us who voted against the lisbon treaty were fools.that if it was brought forword to 3 weeks time that we would all vote in favour.thinks all of us are stupid paddy's ,his man management leaves a lot to be desired.you can keep this fool imo,maybe he's a brillient company man ,but as regards his treatment of irish peoples opinions ,zero rated.
My apologies tubbsy and I do have a problem with setting some activities offshore to avoid Irish tax while effectively claiming to be Irish, a la JP McManus, U2 etc etc.
However, if it were not for our corporation tax rate of 12.5%, we would probably see none of that money at all as the company would be structured in such a way that none of its activities would be taxed under Irish law.
However, if it were not for our corporation tax rate of 12.5%, we would probably see none of that money at all as the company would be structured in such a way that none of its activities would be taxed under Irish law.
So if you want to retain your status as an Irish citizen you should have to pay tax in Ireland?
That is the most stupid suggestion that has ever been posted on here. I think you need to have a think about what you are saying and try and consider all (any would be a start) of the practical implications of your suggestion.
thegalwayman 23 Jan 13:58
That is the most stupid suggestion that has ever been posted on here.
I disagree :)
AFAIK, in the States, every American citizen is responsible for their own taxes and they must file a tax return every year whether they live in America or not.
I see no problem with that system being implemented in Ireland
That is the most stupid suggestion that has ever been posted on here.
I disagree :)
AFAIK, in the States, every American citizen is responsible for their own taxes and they must file a tax return every year whether they live in America or not.
I see no problem with that system being implemented in Ireland
So you lose your status as an American citizen if you do not file your tax return?
On mature recollection, I suppose this is my problem:
I dislike the fact that people like JP McManus, U2, Paddy Power, etc consider themselves Irish (and indeed take pride in it) without actually contributing anything to the country as such.
I dislike the fact that people like JP McManus, U2, Paddy Power, etc consider themselves Irish (and indeed take pride in it) without actually contributing anything to the country as such.
nothing quite like people talking thru their arses about things they clearly dont understand!
Its very simple:
Michael O Learys JOB is to run Ryanair and part of that responsibility is to maximise its profits. If he can maximise cashflow by using offshore accelerated capital allowances and management charges good luck to him. Hes doing what hes being paid to do and is BREAKING NO LAWS.
The governments job is to run Ireland.
Dont confuse the two issues and vent your anger where it should be directed. Ryanair may indeed be paying less taxes than we would want it to but thats not their fault.
Personally I cant stand Michael O Leary but get things into perspective.
As for JPs etc same thing. Dont blame them for availing of what a bunch of half wits in Leinster House present to them on a plate.
Its very simple:
Michael O Learys JOB is to run Ryanair and part of that responsibility is to maximise its profits. If he can maximise cashflow by using offshore accelerated capital allowances and management charges good luck to him. Hes doing what hes being paid to do and is BREAKING NO LAWS.
The governments job is to run Ireland.
Dont confuse the two issues and vent your anger where it should be directed. Ryanair may indeed be paying less taxes than we would want it to but thats not their fault.
Personally I cant stand Michael O Leary but get things into perspective.
As for JPs etc same thing. Dont blame them for availing of what a bunch of half wits in Leinster House present to them on a plate.
nothing quite like people talking thru their arses about things they clearly dont understand!
Its very simple:
Michael O Learys JOB is to run Ryanair and part of that responsibility is to maximise its profits. If he can maximise cashflow by using offshore accelerated capital allowances and management charges good luck to him. Hes doing what hes being paid to do and is BREAKING NO LAWS.
The governments job is to run Ireland.
Dont confuse the two issues and vent your anger where it should be directed. Ryanair may indeed be paying less taxes than we would want it to but thats not their fault.
Personally I cant stand Michael O Leary but get things into perspective.
As for JPs etc same thing. Dont blame them for availing of what a bunch of half wits in Leinster House present to them on a plate.
Its very simple:
Michael O Learys JOB is to run Ryanair and part of that responsibility is to maximise its profits. If he can maximise cashflow by using offshore accelerated capital allowances and management charges good luck to him. Hes doing what hes being paid to do and is BREAKING NO LAWS.
The governments job is to run Ireland.
Dont confuse the two issues and vent your anger where it should be directed. Ryanair may indeed be paying less taxes than we would want it to but thats not their fault.
Personally I cant stand Michael O Leary but get things into perspective.
As for JPs etc same thing. Dont blame them for availing of what a bunch of half wits in Leinster House present to them on a plate.
I dislike the fact that people like JP McManus, U2, Paddy Power, etc consider themselves Irish (and indeed take pride in it) without actually contributing anything to the country as such.
Stop posting now like a good man.
Stop posting now like a good man.
There is a world of difference between people taking advantage of tax laws within a country to their own benefit and leaving that same country to avoid the tax laws altogether.
Should I post this reply twice in response to both your patronising posts or is the once enough for you?
Should I post this reply twice in response to both your patronising posts or is the once enough for you?
Should I post this reply twice in response to both your patronising posts or is the once enough for you?
once is one too many. Do as the galwayman says!
once is one too many. Do as the galwayman says!
el gato & thegalwayman:
Are you in favour of the current legislation as it stands or do you think more should be done to avoid tax exiles?
Are you in favour of the current legislation as it stands or do you think more should be done to avoid tax exiles?
would change it instantly.
not trying to be patronising simply dont understand some of the logic being put up.
If a man walks past a mercedes garage and the owner comes out and says" here have a brand new merc" its hardly the mans fault if he takes
not trying to be patronising simply dont understand some of the logic being put up.
If a man walks past a mercedes garage and the owner comes out and says" here have a brand new merc" its hardly the mans fault if he takes
Of course I'd change it. However, as it stands I would capitalise on it in an instant were the opportunity available to me. I'm not going to discuss this any more with you as you are clearly incapable of full brain function. 'Paddy P contribute nothing to the country'- How many staff do they have? Is JP obliged to keep propping up the racing industry? Donate to good causes?
el gato - good point but if that self-same man then went around saying how he is a BMW man through and through would you not consider him a hypocrite.
TGM - unless you cease with the insults then there is not much point in engaging in any meaningful discussion with you. You have your opinion and I have mine - the differing opinions is what makes a forum tick - continuing insults are whta will cause some people to stop posting and thus the forum dies.
But nonetheless
You think Paddy Power employs thousands for the good of the country - they employ people to make a profit
And yes JP donates to good causes but let him do it with his after-tax income, like the rest of us. And as for propping up the horse-racing industry - give me a break - the tax breaks given by successive governments have propped the industry up for years now.
TGM - unless you cease with the insults then there is not much point in engaging in any meaningful discussion with you. You have your opinion and I have mine - the differing opinions is what makes a forum tick - continuing insults are whta will cause some people to stop posting and thus the forum dies.
But nonetheless
You think Paddy Power employs thousands for the good of the country - they employ people to make a profit
And yes JP donates to good causes but let him do it with his after-tax income, like the rest of us. And as for propping up the horse-racing industry - give me a break - the tax breaks given by successive governments have propped the industry up for years now.
I am well aware of why companies employ people. My point is that Paddy Power contribute to this country by generating employment, even if that is not their intention. If you do not realise how employing people is beneficial to this country, then I give up.
If JP McManus decided in the morning that he was pulling all his horses out of training and was not buying any more, do you not think it would have a significant impact on the industry?
I will not be posting on this thread again as I have already spent too much time on here today.
As for my insults encouraging people not to post, this forum has enough fools already so no one will miss you if you do not post again.
If JP McManus decided in the morning that he was pulling all his horses out of training and was not buying any more, do you not think it would have a significant impact on the industry?
I will not be posting on this thread again as I have already spent too much time on here today.
As for my insults encouraging people not to post, this forum has enough fools already so no one will miss you if you do not post again.
I think Irelands economy has been, is, and will continue to be better as a result of people like jp, bono, pp, ryan air etc they all have contributed in some way . Do they pay as much as we would like them to? probably not but I think it smacks of begrudgery when we ridicule these people. Fundamentally if everyone in the economy contributed as much as these have we wouldnt be in the mess we're in.
el gato 23 Jan 16:14
I think Irelands economy has been, is, and will continue to be better as a result of people like jp, bono, pp, ryan air etc they all have contributed in some way . Do they pay as much as we would like them to? probably not but I think it smacks of begrudgery when we ridicule these people. Fundamentally if everyone in the economy contributed as much as these have we wouldnt be in the mess we're in.
Spoken like a true armchair Economist!!
"If all economists were laid end to end, they would not reach a conclusion".
George Bernard Shaw
I think Irelands economy has been, is, and will continue to be better as a result of people like jp, bono, pp, ryan air etc they all have contributed in some way . Do they pay as much as we would like them to? probably not but I think it smacks of begrudgery when we ridicule these people. Fundamentally if everyone in the economy contributed as much as these have we wouldnt be in the mess we're in.
Spoken like a true armchair Economist!!
"If all economists were laid end to end, they would not reach a conclusion".
George Bernard Shaw
Hey Viva, HNY, mate I hope things are going well for you.
cant be bothered reading much on this forum anymore, but one thing has struck me on this thread,what a pr1ck thegalwayman is.
the sooner the gaa starts up the better :)
the sooner the gaa starts up the better :)
i actually used to think he/she was ok, but lately he/she is very irritating and condescending
Thank you box/fox ....many happy returns to you ...and punting returns as well.
I'm just back from a week on the Costa Del Sol . Great living down there -super climate , lovely food , pleasant people and cheap cost of living + golf courses all over the place .
Hope my punting can fund a few more trips this year -though I need to tighten up on my discipline.
Profitable puntng to you as well box.
I'm just back from a week on the Costa Del Sol . Great living down there -super climate , lovely food , pleasant people and cheap cost of living + golf courses all over the place .
Hope my punting can fund a few more trips this year -though I need to tighten up on my discipline.
Profitable puntng to you as well box.
Vubiant I, lived on the Costa for a year in Nerja, but had to come back for family reasons, I can't wait to go back for good. I studied modern Greek a long time ago thinking i would end up there, the best laid plans and all that!. I don't think a rudimentary Spanish level would be too difficult to attain, after Gaelic, and Greek, it should be a breeze, (he says foolishly), anyway, I off now gn and gl.
Without going into the morality and politics of corporate tax avoidance....and speaking purely as a consumer.
Having travelled too and from the UK to Ireland by ferry and air over the last 50 years on a regular basis.
The ease and cost of reaching the west coast of Ireland through Ryanair nowadays... is unbeatable imo.
Having travelled too and from the UK to Ireland by ferry and air over the last 50 years on a regular basis.
The ease and cost of reaching the west coast of Ireland through Ryanair nowadays... is unbeatable imo.
nevo agreed. Not a fan of O'Leary but dont forget what the routes in and out of Ireland were like when Aer Lingus had a monopoly.
For this reason I am against Ryanairs attempted takeover of AL.
For this reason I am against Ryanairs attempted takeover of AL.
Could he write of the cost of horse purchases in some way ?
isn't ''Ireland Inc.'' one of the most despicable phrases you've ever heard?
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