Tax In Switzerland

A Contractor's Guide to Taxes : 

One of the most consistently challenging aspects of contracting in Switzerland is complying with the country’s tax system. As well as paying tax in Switzerland, you might also still be eligible to pay some tax in your home country, and understanding the legislation behind this can be a challenge.

How do I calculate my taxable income: 

If you’re working in Switzerland under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in Switzerland for you and then send you a net wage. Your income tax, public health insurance, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in Switzerland, but contractors may not be offered this service because of their short stay with each employer.

Anybody who can’t pay their tax in Switzerland through PAYE is left with the prospect doing everything themselves.

Do you know much about Swiss Tax Law? Does Switzerland have a tax treaty with your home country? You will need to find out or find someone who can help! Income tax in Switzerland can range from 0.77 to 11.5 percent (not including cantonal taxes), and you need to be sure you are placed in the correct tax brackets.

Tax Calculator: 

If you are a contractor and want a calculation on your tax and net retention in Switzerland, we can supply it to you free of charge.

Using an Umbrella Company for Income Tax : 

Contractors in Switzerland are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. A Swiss umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).

The companies are experts in Swiss taxation, and they’ll ensure that you keep the largest proportion of your earnings whilst complying with local laws. They can deal with any issues with the Swiss tax office or tax department directly including processing your tax refund if you are eligible.

How We Can Help You with Tax: 

We work with numerous umbrella companies in Switzerland, many of whom are experts in tax and immigration laws. If you have any questions about tax in Switzerland, we’ll get the answers from them directly so you can rest assured you’ll be getting accurate information. We have comprehensive knowledge of the different services they provide, and can help you find the right company to handle your income tax. We help oil and gas workers, software developers, IT project managers, testers, business analysts and telecommunications contractors get tax efficient payments and sponsorship for their Swiss work permit.

Our advice is 100 percent free, and comes with no obligations. You will be paying taxes in Switzerland but without the overhead of directly dealing with the Swiss tax authorities. Get in touch with us today for some reliable advice on tax in Switzerland!

 

When Do You Need to Lodge Your Tax Return?: 
15 or 31 March (depending on canton of residence)
Tax Filing Deadline : 
15 or 31 March (depending on canton of residence); with extensions of up to November
Can you file it online? : 
Yes
Currency: 
Swiss franc (CHF)
Tax-free Threshold in: 
CHF14,500
Grossed Income: 
0-28,300
Tax Rate: 
0%
Grossed Income: 
>28,301-50,900
Tax Rate: 
1%
Grossed Income: 
>50,900-58,400
Tax Rate: 
2%
Grossed Income: 
>58,400-75,300
Tax Rate: 
3%
Grossed Income: 
>75,300-90,300
Tax Rate: 
4%
Grossed Income: 
>90,300-103,400
Tax Rate: 
5%
Grossed Income: 
>103,400-114,700
Tax Rate: 
6%
Grossed Income: 
>114,700-124,200
Tax Rate: 
7%
Grossed Income: 
>124,200-131,700
Tax Rate: 
8%
Grossed Income: 
>131,700-137,300
Tax Rate: 
9%
Grossed Income: 
>137,300-141,200
Tax Rate: 
10%
Grossed Income: 
>141,200-143,100
Tax Rate: 
11%
Grossed Income: 
>143,100-145,000
Tax Rate: 
12%
Grossed Income: 
>145,000-895,900
Tax Rate: 
13%
Grossed Income: 
>895,901
Tax Rate: 
11.5%
How long does it take to set up: 
6-10 days
How much does it cost: 
Minimum CHF1,320
Is it easy? : 
Starting a Business Rank: 73/190 (Source: World Bank)
How to File Taxes in: 

The cantonal tax administrations deal with tax returns. Federal tax is assessed and collected by the cantons on behalf of the Confederation. Enter your municipality under ‘completing your tax return online’ here to be redirected to a website where you can complete your tax return online.

If you are a resident foreign national and your gross employment income exceeds CHF120,000 (CHF500,000 in Geneva) per year, you are required to file an ordinary tax return. Otherwise, in most cantons, resident foreign nationals are taxed through the wage withholding system. Your employer will usually levy the wage withholding tax on a monthly basis.

Non-resident individuals generally pay their taxes via wage withholding and are not required to file a tax return for their employment income. They may claim a correction of the withheld wage taxes to claim additional deductions.

Notes: 
  • If taxable income exceeds CHF895,900, all taxable income is subject to a flat rate of 11.5%.
  • The tax table above, applies to married taxpayers. Taxable income brackets and tax rates vary for single taxpayers and single taxpayers with minor children.
  • Each canton has its own tax rates and basis of taxation. You can find tax rates for your canton here.
  • Expenses incurred in connection with employment income, maintenance and operating costs of real estate, are deductible from taxable income. An annual deduction of CHF18,000 is allowed for expatriates.

 

Does the 183 day rule apply in: 

No

When do you become a tax resident in: 

You become a tax resident in Switzerland if you:

  • Intend to establish Switzerland as your main abode and are registered with the municipal authorities; or
  • Stay in Switzerland with the intention to work for a period exceeding 30 days (ignoring short absences); or
  • Stay in Switzerland with no intention to work for 90 consecutive days (ignoring short absences).
Am I taxed on my global income in: 

Yes, if you are a resident, except on income from real estate located abroad, and income from either a fixed place of business or a permanent establishment located abroad.

Non-residents are only taxed on Swiss-source income.

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