What considerations should I have if creating my own company is a condition of getting a pilot job.?

This was one of the first questions we got after the academy had been set up, and by answering it here in the academy hopefully, you will all benefit from it. As you can see in the question and the reply we never put out personal details and we try to keep it high level.

The first consideration is probably – can you afford not to do it? If it is the only pilot job you have been offered then maybe you don’t have any other option than to go down the route of creating your own company. If however, you do have another job offer on hand, you may want to consider the pros and cons.

It’s only a few of us have experience setting up our own company. The rules and ease are heavily depending on the country where you set up the company. If you have to understand the legislation in another country, set up a foreign bank account, or have an address – expect these things can take some time. But let’s say you have successfully set up a company in your own home country and you are now a company director. Being a company director usually gives you some freedom to claim “allowances” in your company, which ones you can claim of course varies from country to country but some countries will allow your company to charge rent (if using a room in your home), deduct certain items used for your company etc. Be careful if you start to enter any business-to-business agreements (again depending on the type of company you have filed) as some business types make you personally accountable. Example. Through your company, you buy a new phone and get a phone contract. The contract runs for 36 months. After 6 months you don’t need your company anymore as you have got a new pilot job where you are employed directly with the operator. You close your company. However, when you try to terminate your business phone contract you still have 30 months left to pay. Now in your company, you have “0” money to pay for the phone contract, but that doesn’t mean you are off the hook. If the company cannot pay for the contract you have entered, the bill gets passed on to you if you are personally liable. So whenever you form a company be sure you understand what responsibilities come with it.

From an employment point of view being employed as a pilot through your own company usually means that you (the pilot) are merely a contracted product. If the product gets delivered your company gets paid. In other words, if you work you get paid. This illustrates one of the potential big differences. If you are sick you are likely not to get anything, as your company has not delivered any service it can charge for.

Also in regards to “your service is no longer required” this message could come with little warning (no notice period).

Of course, being employed through your own company is not all bad, but your attention in this reply is drawn more towards the most frequent issues. It does not represent a thorough walkthrough, it’s merely just scratching the surface sending the message that you should make sure you protect yourself by knowing what you are getting yourself into. As always feel free to contact us if you would like to have a conversation about your situation, we will make sure we listen and help where we can.

Happy landings

Soren,

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