Net salaries and how to maximize the MSCA income

[youcancallmeadreamer]

Hi everyone!

I have created this group to discuss about the issue of budget, net salary, working conditions etc. I hope you find this useful as this is a topic that, in my opinion, is not presented very transparently it is something that we all care about…!

I personally have been granted a global postdoctoral fellowship with an outgoing phase in USA - San Francisco and return to Spain and I have two questions:

- I am quite horrified after being informed that the employer costs (36% in my case!!) are deducted from the living allowance rather than the management and indirect contribution cost. Is there anything we can do about this?

- I also am not sure about weather the mobility and family allowance are subject to tax deductions or not.

The MSCA is supposed to be a very competitive gran and the truth is that I have realized that it is not so much...does anyone else have the same feeling or I am alone here?

In my case, for example, the cost of living in San Francisco is extremely high but the country correction does not account for this, just accounts for USA in general. Renting a flat in SF is around 2500$ per month which leaves very little margin for living (my net salary after all would be around 2700e aprox.)

Does anyone have any advice regarding how to overcome this situation? Is there anything we can do about this?

Thank you in advance

[CountZ]

This is an interesting thread, thanks for starting it.

It seems that everyone gets a different salary, even within the same country, as there are so many variables. One is obviously the taxation rate. Do you know whether you are taxed in Spain, or in the US, or in both?
Presumably, the Spanish beneficiary employs you, and you only pay taxes on that? Although you may have to pay income tax if you reside in the US too, even on foreign income, unless there is a tax treaty between Spain and the US/CA?

Another issue is what is taxed. In some jurisdictions, the mobility allowance and family allowance are not taxed (these are considered grants rather than salaries). In others they are included in the salary and taxed. In others still, the institution decides to not routinely transfer those to the fellow, and then there is the question of what happens to the sum at the end of the fellowship.

Re: your first question, I imagine that your institution would have to pay tax on the gross living allowance based on national legislations. Then you would have to pay tax on what you get. For the second question… the answer seems to be that ‘it depends’.

Yes, the country coefficients don’t account for higher cost of living areas – and housing in SF is tough for everyone there. But realistically, I think that this is a systemic disadvantage, as housing is always more expensive in college towns than in the country in general.

It would be interesting to hear from others:

• How much did you make in take-home income?

• What was taxed?

• Did you have to lobby your institution for a particular arrangement?

[griffin]

Thank you for starting this thread!

The 'salary after taxes' is just a great unknown to me. You often find out fellows reporting that 'some people get their Mobility + Family accounted as net-salary, and taxed over it, and some people manage to get the full amount of Mobility + Family allowance'; And also that 'this issue has already been discussed by the EU funding agency, and seems they are divided about the taxation over Mobility + Family allowance'. So, lets keep this in mind, because we can probably negotiate about that with our host institutions.

So, I guess there is no official position from the EU side, and I found no information about that in Horizon 2020 Manuals (if someone has any official info about this, please, share!)

In my case, I will move with my family (wife + kids) to Lisbon. Rents are high (as in all major EU cities), but still the correction coefficient for me is ~0.84. On top of that, there will be an extra deduction of taxes - of about ~44% - (and Uou! That is something!)

So, I definitely need to learn how to convince my host to collect taxes only over my gross living. I will try to have the Mobility + Family allowance clear of taxes. I am not sure if it is possible for us to argue about that. Also, I am not sure WHEN in the process we should address that. Is it before the GAP agreement is signed?

[St_Remy]

Are there fellows going to FINLAND? I would like to exchange information regarding net salaries, accommodation, and living conditions in FINLAND. I just learned that there is a foreign expert tax rate that is somewhat lower than the normal tax rates applicable to resident individuals. Any info?

[MSCA2021_EF_ENGG]

Thank you so much for the conversations. i am moving to France with my family.. They have not taxed mobility allowance. But I was shocked to see that they are collecting 54 % tax from the living + family allowance. Should I negotiate? Any insights from your experience?

[ym23333]

Thank you so much for the conversations. i am moving to France with my family.. They have not taxed mobility allowance. But I was shocked to see that they are collecting 54 % tax from the living + family allowance. Should I negotiate? Any insights from your experience?

Hi, do you mean 54% deduction? The highest tax rate in France is 45%. if 54% is the tax I would definitely ask about it.
My understanding is the indicated number: living*(country corrected coeffcient)+family allowance is the salary, which includes the 'cotisations patronales' (employer contributions) normally between 31%-36%. After removing the employer contributions, it is the 'salarie brut' and it is still not the money you have. After removing the employee contributions it will be the amount you recieve. Dependent on the salary and institute, the employee contribution varies. The deductions include you unemployment insurance, health insurance, pensions, tax etc. In general, after deducting everything you may have half-ish of the indictated number. So if 54% is the total deduction, it is more or less about right. But still, it would be great if you could ask the financial department to provide a payslip to know what has been deducted and if you spot anything unreasonable or uncertain, you could ask about it.

[MSCA2021_EF_ENGG]

Thank you so much for the message! I wrote to them. The host institution responded by saying that they made some mistake in the calculation and they revised the calculation and sent it. now the overall tax is 45 % over the living + family + mobility allowance. And there is no tax for mobility allowance for the first 9 months. I will ask for more details on such deductions as you have rightly pointed out. Thank you so much.

[j_3434]

Just saw this thread. I am also going for an MSCA to the San Francisco area, with return to the UK.

I guess I had the same revelation as many of you regarding taxation and employer's cost being part of the mix. In my case the only way to make this whole thing work financially is to give up any form of pension contribution for 3 years. I'm not delighted at the prospect but other than that I'm not sure I'll be able to afford much more than living in a garden shed (although even that is expensive... saw a converted one for over $1500 a month!).

@youcancallmeadreamer, if you're going to the US you'll also need health insurance. Personally, for me that was a deal breaker, until my host institution agreed to pay for it.

I'm currently trying to get the mobility allowance to not be taxed, although the only way I can see that happening is if it never reaches my bank account and I claim back expenses on it. Any left-over at the end of the project will get paid to me as salary and will get taxed as income.

Out of curiosity, has anyone managed to get any additional financial support from their host institution?

[FairEnough]

Interesting question,
Up!

Just saw this thread. I am also going for an MSCA to the San Francisco area, with return to the UK.

I guess I had the same revelation as many of you regarding taxation and employer's cost being part of the mix. In my case the only way to make this whole thing work financially is to give up any form of pension contribution for 3 years. I'm not delighted at the prospect but other than that I'm not sure I'll be able to afford much more than living in a garden shed (although even that is expensive... saw a converted one for over $1500 a month!).

@youcancallmeadreamer, if you're going to the US you'll also need health insurance. Personally, for me that was a deal breaker, until my host institution agreed to pay for it.

I'm currently trying to get the mobility allowance to not be taxed, although the only way I can see that happening is if it never reaches my bank account and I claim back expenses on it. Any left-over at the end of the project will get paid to me as salary and will get taxed as income.

Out of curiosity, has anyone managed to get any additional financial support from their host institution?

[msca-europe22]

Don't you know if we can have any part time job during MSCA?