Taxes in Switzerland
Basics of the Swiss taxation system
Citizens with a residence permit (L, B or G) are generally taxed at source. This means that their Swiss employer deducts the relevant taxes directly from their wage and transfers them to the tax authority. Those with a C-type permit for settled foreign nationals pay their taxes by means of the normal taxation procedure.
You become taxable upon commencement of gainful employment. Taxation is based on the monthly gross wage excluding social contributions for old age and survivors’ insurance/invalidity insurance, unemployment insurance, accident insurance and pension insurance. Should the annual gross wage exceed 120,000 CHF, taxation takes place through the usual procedure instead of at source.
The national government, canton and municipality levy taxes
Switzerland is made up as follows:
1 federal government
Each of the 26 cantons and each of the 2352 municipalities has a certain degree of independence.
This means that each canton has its own taxation law. There is a law that aims to harmonise the cantons’ taxation law (SthG), but the cantons are currently free to determine taxation scales, taxation rates and tax-free amounts. This leads to large differences in the amounts of tax due.
In addition, the municipalities have an influence on taxation. This means that the amount of tax due can differ from canton to canton and municipality to municipality, depending on where you live.
The comparison portal Comparis.ch provides a comparison calculator. This compares the amount of income tax due in the cantons, as well as the differences between income tax between different municipalities within the same canton. Link to the comparison calculator
The Federal Tax Administration also provides a tax calculator. You can find this here.
Private tax declaration in Switzerland
As a foreigner in Switzerland, you need to submit a tax declaration. It is important to claim the permitted deductions in order to reduce the tax burden or receive a refund of taxes already paid. Findea AG, the parent company of Swiss-Permits.ch, is an innovative trust company that advises individuals and companies regarding all matters concerning accounting and taxation law.
Our trustees can advise you in all taxation-related matters, and compile the tax declaration for you.