Hi all,

My Canadian fiancée shall come over soon (last steps of visa under wedding purpose ongoing, wedding date set in september).

As she gave her resignation in her current job in Canada, her employer proposed the option for her to still work for them remotely from Switzerland.

What is the best option to achieve this: can she go on working as an employee of her company here (no company office here) ? Is the option for her to work as independant (contractor) for that company (option employer point out but I'm afraid there would be loops for her to build that -kind of own business creation for a single 'client')? Any thoughts on this or other options ?

P.S: as we get married she shall be entitled to get same permit as mine (B as I'm french with B permit) so my understanding is that work permit side wouldn't be an issue.

Thanks !
R.

I work in this exact situation. I work from home in CH but all of the work effort is produced in the US. I receive a salary in the US, taxed by the US and then transfer the net amount to my Swiss account. When I moved here we checked with the Gemeide and they told me that since the work is produced in the US and I am paid there, that it wasn't an issue. Also as long as I don't earn money from a job in Switzerland then my earnings were not taxable by Switzerland. 2 years on and no problem. I just submit a copy of my US tax returns along with my Swiss one.

Sounds a bit flakey, have you consulted a Swiss Tax expert?

"All persons resident in Switzerland are liable for the taxation of their worldwide income and assets, except on the income and wealth from foreign business or real estate, or where tax treaties limit double taxation"

AIUI USA taxes it's citizens wherever they reside without regard for double taxation rules, and again AIUI you are normally taxed where you are domiciled or habitually resident.

If I where you I'd consult someone quickly, not relay on the word of Cantonal employee, for all we know could be the girl on the helpdesk. Do you have it in writing?

We went to the tax office -- I don't have it in writing but have the gents name. Plus he mentioned the above quote as well -- which because it is income earned in another country and taxed -- that it would not be taxed in CH unless I had a job in CH and then my worldwide income would be subject to tax - less deductions allowing for double taxation.

I would take 'foreign business' as being entrepreneurial not a salary, look at this:

"Switzerland Income Tax

This tax is levied at federal, cantonal and communal level. Personal income tax is progressive in nature.

The basis of assessment is as follows:

Residents are taxable on their worldwide income other than the income arising from enterprises and real estate located abroad."

This seems to confirm my entrepreneurial theory.

You might be ok cos I don't know Swiss Tax Law but for me almost 100% of the time you are taxed where you legally reside, so if I were you I'd see a Swiss Tax Consultant or you could end up in a spot of bother with the tax people. Have you never received a Swiss Tax Form?

Very interesting. What do you do about AHV etc?

Looks like you answered your own question... US/Swiss tax treaty can be found at http://www.irs.gov/businesses/intern...169682,00.html

That's not true (at least, it wasn't 10 years ago when I was working in Germany...)

US citizens are required to FILE every year, but they don't necessarily end up paying taxes. There is an exclusion for FEI (foreign earned income) up to a specified limit AND there are exclusions for taxes already paid, particularly when the situation involves countries where a tax treaty exists.

But I definitely second the recommendation for speaking with a Swiss tax expert.

[Clarification: was only addressing one part of that sentence...]

Greetings from another Michigan native telecommuting for a non-Swiss company while living here in Switzerland!

We should note that the OP's girlfriend is from Canada, not the US (and thus without the extra complication of the US taxing its citizens and green card holders regardless of residency). I would advise the OP to check with the Canadian embassy in Switzerland (or the Swiss embassy in Canada) to clarify the tax situation. This was the fastest way to get the most accurate answers for my scenario.

I am an employee of a US company telecommuting from my home in Switzerland. I am not an independent contractor.

2010 will be the first year in which I receive income for my work, so I can't speak to the complete experience or know what my exact tax liability will be, but I know that I need to report my US-earned income on both a Swiss tax form and a US tax form (I file jointly with my husband).

As far as AHV goes, I will have FICA (US-Social Security and Medicare taxes) withheld from my paycheck. Because the US and Switzerland have a totalization agreement for taxes, I only need to pay into one nation's pension plan. There are specific conditions that determine whether or not someone pays into one plan over the other, but my scenario leads to me paying into the US plan. My US employer applied for a "Certificate of Coverage" from the US Social Security Administration. When I receive this, I will show this to my cantonal AHV office to verify my exemption from paying into Swiss AHV. This website answers a lot of questions on the SSA/AHV point:
http://www.socialsecurity.gov/intern.../switzrld.html

Thanks for reminding us of the OP's question... we were obviously getting sidetracked by Michigan68's arrangement.

Definitely sounds like the OP should get in touch with a Swiss tax expert... whether Canada and Switzerland have a tax treaty or not.

I am in a similar situation to the OP.

I am the Director of a UK Ltd consultancy company. It acts as an intermediary, a limited liability entity, "sitting" between me and my clients.

It files accounts in the UK. It pays a small amount of Corp Tax, in the UK, on token retained profits (<10% of revenue).

The remainder is paid to me, as salary, as a Swiss resident.

• I pay AHV and income tax in CH.
• I made sure to get signed, written, rulings from relevant HMRC units (Residency, IR35, NICO) that this was legitimate
• Right now, I am solely resident in CH, but previously had multi-residency, and had to file multiple tax returns.
• I believe that international tax policies/laws/conventions, certainly those observed by European countries, generally deem that income tax is paid in the country where the (individual's) services are physically performed
• Social security is a separate issue.

I also recommend that the OP seeks professional advice from a tax
advisor.

It most certainly does sound like a flaky arrangement.


/GD

PS - Does anyone want to buy a BMW?
[For Sale, ZH] BMW 330d M Touring 08.2006 83'000km

This is how it was explained to me as well. My spouse set up a company and got the SS exemption. We expect to have to pay Swiss + US federal (net of exclusion) plus state. Fortunately, we will have someone do the returns.

This is precisely how I operated for a couple of years too. I took advice from the local tax office (at the Gemeinde) which was somewhat ambiguous and confusing. A Swiss tax consultant informed me of the above process. I had this confirmed by the federal tax office.

However, in this thread we have people who are clearly resident in Switzerland and therefore should, in my tax consultant's opinion, be subject to income tax in Switzerland at least to the extent of the difference between tax paid elsewhere and whatever would be owed here but don't. This is confusing.

Income based AHV and other social charges must also be paid in Switzerland and with some of the processes in place for some of the posters I don't see a mechanism for doing this.

Seems like confusion.

If the OP never has and does not take a salary in Switzerland ie they earn abroad and are taxed on that money in a foreign country they can declare no AHV relevant earnings and therefore no tax to pay in Switzerland. I believe that is what Michigan68 is doing.

If you are wanting to settle in Switzerland, have earned here or want to get married to someone earning here, then you cannot take this route. In this case if you are working for a non-Swiss domiciled company you need to make yourself familiar with the term ANobAG(Arbeitnehmer ohne beitragspflichtigen Arbeitgeber) which is the mechanism for collecting said AHV and ALV etc for this situation.

Every time I check into this forum, I find a worthwhile nugget like this...

Anyone happen to know the equivalent term for "ANobAG(Arbeitnehmer ohne beitragspflichtigen Arbeitgeber)" in the French-speaking cantons?

Just noticed that I'm very much on-topic here: the OP will be marrying the Canadian lady AND the OP is based in Vaud. Looks like they'll need this reference in French, as well.

[A special thanks, Shorrick. babelfish *almost* got it and google.xlate wasn't even in the ballpark...]

Salariés d'un employeur non tenu de cotiser

Thanks for the answers.

While waiting for being married and get the B-permit processed (and best way to set that up found out), could she work remotely for her company from here or should she avoid any activity not to get into troubles ?

Thks
R.

Bill, could you please tell me what your immigration status in Switzerland is ? What kind of permit visa do you uhave ? I'm from San Francisco. I'm willing to move to Zurich but I want to continue working for my American company. My understanding was that I need to apply for work permit and go through entire process. Thanks!