Do You Really Live Where You Say You Do? A Tax Lesson from a KLM Pilot

Formal emigration isn’t always enough

In 1986, the Dutch Supreme Court ruled on the tax residence of a KLM pilot who had formally moved to Dublin. Despite being deregistered in the Netherlands and listed as a resident of Ireland, he was still considered a Dutch tax resident.

Why?Because he continued to work for KLM, spent a substantial amount of time in the Netherlands, and maintained strong personal and economic ties with the country.

No tie-breaker in the treaty

At the time, the 1969 tax treaty between the Netherlands and Ireland did not include a tie-breaker provision for dual residence. The Court therefore applied Dutch domestic law — specifically, Article 4 of the General Tax Act:

“Residence shall be determined according to the circumstances.”

Since 2021, a new treaty with Ireland is in force, which does include a tie-breaker. But the core lesson from the case still applies today.

What truly determines tax residence?

✅ Tax residence is not based on paperwork, but on real-life facts✅ What you do matters more than what you file

This decision remains highly relevant — especially for cross-border workers, expats, and anyone who believes that deregistering is enough to escape Dutch taxation.