When are foreigners liable to pay Swiss taxes?

Are you a foreign national working in Switzerland? As with any country, taxation can be a complex process to negotiate without the right advice.
Our guide for foreigners about taxation in Switzerland highlights some common questions about tax liability. Contact our financial adviser for expert advice and referral to leading Swiss tax and accounting professionals.

Residence status

To begin with, you should know your official residence status. This will determine whether or not you are liable to pay personal income tax in Switzerland, rather than your nationality.

For tax purposes, you are deemed to be a resident of Switzerland if you are employed in Switzerland, even if you aren’t a national and are employed on a temporary work-permit.

You are also considered resident if you own a business in the country or if you are resident for more than 180 days in any given year.

Exceptions are sometimes made if you reside in Switzerland for less than 180 days a year, if this is at a permanent address. Having a permanent address means you can be considered resident for tax purposes after only 90 days.

Which income is taxed?

In general, Switzerland does not distinguish between Swiss residents and foreign employees of offshore operations when it comes to levying personal income tax.

The only exception to this is a certain type of discriminatory tax levy known as the lump sum assessment deal, which is levied according to personal wealth criteria.

The lump sum assessment

In brief, this allows wealthy individuals to have tax levied according to their expenditure in Switzerland, rather than on their income.

This is clearly an advantageous situation, since you will be able to pay substantially less tax than a Swiss national earning an equivalent income.

Furthermore, as this category of personal income tax is levied on expenditure in Switzerland rather than on the sum of income, wealthy individuals are able to take advantage of greater financial privacy than in other countries.

The lump-sum assessment therefore allows wealthy foreign nationals to be resident in Switzerland without working in the country.

It is subject to several conditions and restrictions, and as with many aspects of the fiscal system, it also varies from canton to canton.

Find out more

Tax and accounting in Switzerland are complex issues, and need to be considered according to individual circumstances. Please contact our financial expert if you need any further assistance to find the right professional to help you.
Visit Website - Contact our financial advisor
We are processing your request…

Premium Switzerland is a proud member of