SWISS TAX FAQ

  • In general, all Swiss citizens and C permit holders have a filing requirement.
  • Foreign nationals who are Swiss tax residents holding an L or B permit will normally have to file a Swiss tax return each year if certain conditions are met:
  • Employment income > 120’000 CHF *

Private net income > 2’500 CHF *

Value of net assets > 200’000 CHF *

Self-employment income

Property in Switzerland

* Conditions apply for canton Zurich. Other cantons might have different quotes. 

You have to notify the Swiss tax authorities about the voluntary disclosure. When you do it for the first time, no penalties will apply, only payment of tax and interest which was missing in the past. For future disclosures a penalty of 1/5 of evaded taxes will apply.

You must prepare a letter to the tax authorities listing all not declared income / assets and attach all relevant statements, receipts, invoices to it (for max. 10 years of not declared income / assets). Than forward your voluntary disclosure to the relevant tax authorities.

Your subsequent declaration will be treated as a voluntary disclosure (free of penalty) only if the tax authorities were not aware of the circumstances or did not discover it before your notification.

 

The due date for submitting the Swiss tax return is usually 31 March of the following year. Some of the cantons have earlier deadlines (28 February, 15 March). This due date can be extended by sending an application for an extension to the relevant canton respectively communal tax authorities.

Failure to file a tax return on time may lead to default taxation (with higher tax liability) and penalties for non-filing.

If you are a foreign resident or an international weekly commuter not meeting the criteria to file a tax return, most of the cantons (ZH, AG, ZG) will not allow you to file a tax return. Your tax at source is automatically deducted from your brut salary by your employer on a monthly basis and represents your final Swiss tax liability.

However, should you have additional expenses as listed below, you can file an application for tariff correction to reduce your tax liability and receive a tax refund for overpaid taxes.

Following claims can be made through a tariff correction:

Cost of international weekly commuting, such as travel expenses and double housing cost

Debt interest for loans and credit cards

Professional training and education cost (if related to current employment and not reimbursed by your employer)

Contributions into pillar 3a

Buy-in into 2nd pillar

Alimony payments

Support payments

Child care cost

Donations

Health and accident cost

Cost associated with disability

Please note that the deadline for filing an application of tariff correction is in all German-speaking cantons (except Basel Stadt – 30 September) the 31 March. This deadline is not extendable.

You have to notify the Swiss tax authorities about the voluntary disclosure. When you do it for the first time, no penalties will apply, only payment of tax and interest which was missing in the past. For future disclosures a penalty of 1/5 of evaded taxes will apply.

You must prepare a letter to the tax authorities listing all not declared income / assets and attach all relevant statements, receipts, invoices to it (for max. 10 years of not declared income / assets). Than forward your voluntary disclosure to the relevant tax authorities.

Your subsequent declaration will be treated as a voluntary disclosure (free of penalty) only if the tax authorities were not aware of the circumstances or did not discover it before your notification.

No consequences for minor mistakes (e.g. wrong deduction). The tax authorities will amend the mistake without any penalties. Should you, however, not report income or assets (depending on amount) it might lead to serious consequences (tax evasion).

Generally, US citizens (or individuals with a filing obligation in the US) get a tax credit in their US tax return for taxes paid in Switzerland. In addition, income taxable in the US is exempt from Swiss taxation but should be declared for tax rate determination.

Yes. A foreign real estate property is not taxable in Switzerland but should be reported for tax rate purposes. You need to declare the market value and rental income (if applicable) in your Swiss tax return.

A home office can only be tax deductible if a substantial part of work has to be performed at home due to a lack of the official work place and if you have a separate room at home which is primarily used for work purposes.

If a home office is used due to private reasons although your employer has provided you with a work place, home office will not be tax deductible.

The costs for home office are also included in the lump sum deduction for other work-related expenses.

Expatriate regulation apply only for foreign national working in Switzerland who are either:

Executive (i.e. directors or members of the management board), who have been seconded to Switzerland for a temporary period of up to a maximum of 5 years transferred by their foreign employer;

Specialists, who are seconded to Switzerland for a temporary period of up to a maximum of 5 years because of their special professional qualifications or specific know-how; or

Foreign nationals who are self-employed in their home countries and who are employed in Switzerland to provide specific business services for a temporary period of up to a maximum of 5 years.

Such expatriates are also referred to as international assignees.

If an international assignee continues to work in Switzerland over the 5-year maximum period, then they will no longer be considered entitled to claim the special business expenses from the 6th year on.

Following special expatriate expenses can be claimed only if the employee has borne the costs by himself or if the payments made by the employer have been included in the taxable gross compensation:

Costs for transportation of the household goods to and from Switzerland;

Travel costs for the employee and his family from and to Switzerland at the beginning and at the end of the assignment;

Reasonable housing expenses in Switzerland provided the international assignee retains a household in the home country and does not rent it out;

School costs for an international foreign-language school in Switzerland, if no suitable Swiss school is available.