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  #21  
Old 30.09.2014, 10:28
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Re: gift from parents: tax question

So just to check:

Looking at the link given by BokerTov, in Switzerland gift tax is paid by the recipient, not the giver.

So gifts given to someone resident outside of Switzerland - no Swiss liability, regardless of the amount, timing, relationship, etc. (Tax in the country of residence is another issue, obviously.)

Correct, incorrect?
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Old 30.09.2014, 10:35
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Re: gift from parents: tax question

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Correct, incorrect?
The latter

It is all kanton dependent! Check out your kantons Steueramt website.

With neither my sister or I living in the UK we will be looking to do some estate planning with my parents!
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Old 30.09.2014, 10:47
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Re: gift from parents: tax question

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The latter

It is all kanton dependent! Check out your kantons Steueramt website.

With neither my sister or I living in the UK we will be looking to do some estate planning with my parents!
Where you & your sister live won't effect the IHT liability of a UK citizen with UK domicile, regardless of where that person lives either.

The double whammy is the estate is charged IHT & the receiver could be taxed again in CH.
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Old 30.09.2014, 10:54
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Re: gift from parents: tax question

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Where you & your sister live won't effect the IHT liability of a UK citizen with UK domicile, regardless of where that person lives either.

The double whammy is the estate is charged IHT & the receiver could be taxed again in CH.
Estate planning happens well before the final shuffle off this mortal coil.

In kanton Zurich there are allsorts of ways to minimize or eliminate tax - with the final aim to be under the tax threshhold in the UK.
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  #25  
Old 30.09.2014, 10:59
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Re: gift from parents: tax question

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Yes it will incur tax. You are taxed on your world wide assets and income, so you had better wire it back straight away! Then accept presents only after you have spoken to your tax advisor!
What if the gift is a house in one's home country? I inherited my grandparents' house and we are in a very lengthy and bureaucratic process under the inheritance laws; my mother insists (and she's as stubborn as you can get) that the house should be on my name, thus I can dispose of it anytime I want. Given the fact that we're going to pay a lot of money in notary taxes there and I don't even want to rent it, or sell it for the moment (maybe later on if other half and I decide to buy a home in Ch or Austria), should I declare it? I can actually anticipate the answer but it just doesn't seem fair.
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  #26  
Old 30.09.2014, 11:02
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Re: gift from parents: tax question

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What if the gift is a house in one's home country? I inherited my grandparents' house and we are in a very lengthy and bureaucratic process under the inheritance laws; my mother insists (and she's as stubborn as you can get) that the house should be on my name, thus I can dispose of it anytime I want. Given the fact that we're going to pay a lot of money in notary taxes there and I don't even want to rent it, or sell it for the moment (maybe later on if other half and I decide to buy a home in Ch or Austria), should I declare it? I can actually anticipate the answer but it just doesn't seem fair.
Again - it depends on your kanton. The usual practice is to just say "x" died and left you "y".

If you are worried slip the money in slowly.
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Old 30.09.2014, 11:14
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Re: gift from parents: tax question

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Again - it depends on your kanton. The usual practice is to just say "x" died and left you "y".

If you are worried slip the money in slowly.
Well, I am worried because I know you can't really "fool" the system (no matter how unfair you think it is) and if you try you might lose in the end more than what you though you were saving plus place yourself on the same level with the common tax dodgers. So I guess I'll have to declare it.
As far as I heard I'll have to pay taxes as if I rented the property, even if I am not. Nice.
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  #28  
Old 30.09.2014, 11:20
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Re: gift from parents: tax question

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Estate planning happens well before the final shuffle off this mortal coil.

In kanton Zurich there are allsorts of ways to minimize or eliminate tax - with the final aim to be under the tax threshhold in the UK.

What I was pointing out is that your & your sister being non resident was irrelevant
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Old 30.09.2014, 11:30
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Re: gift from parents: tax question

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What I was pointing out is that your & your sister being non resident was irrelevant
It is very relevant!!

If a big chunk of the estate is moved (>7 years before death) in a tax efficicent manner so that the whole estate falls under the threshold. Tax is saved. It seems foolish to incur inheritence tax when not necessary.

Further more - it is beneficial for assets to be moved to bring them under certain "care" thresholds - with additional costs been carried from a Swiss resident (for example) who can deduct those amount from income as the parents are dependent!

Research is on going on exactly how this can be structured
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  #30  
Old 30.09.2014, 11:31
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Re: gift from parents: tax question

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Well, I am worried because I know you can't really "fool" the system (no matter how unfair you think it is) and if you try you might lose in the end more than what you though you were saving plus place yourself on the same level with the common tax dodgers. So I guess I'll have to declare it.
As far as I heard I'll have to pay taxes as if I rented the property, even if I am not. Nice.
Do you have to make an annual tax declaration or are you taxed at source.
If it's the latter then you have nowhere to declare it unless you make a voluntary declaration ( if that's even possible).
If it's the latter then you should declare it on your tax declaration but if the house is not in your name and you receive no income for it then who's going to find out? Not that I'm advocating tax evasion in any way, only you can decide if it's worth the risk.
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  #31  
Old 30.09.2014, 11:51
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Re: gift from parents: tax question

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And you think the tax office have access to your bank account details?
No- but if they decide to investigate someone, for whatever reasons- they will. When our fiduciaire does our tax return, he requests all our bank yearly statement, both here and the UK, all statements of pensions, investments, ISAs (you can't contract ISAs when resident abroad- but you can keep thos you have already) etc, etc- so tax return can be completed honestly. Property abroad has to be declared- you might get away without declaring, but for us, it is not the way to go, because it can seriously catch up with you one day- but mostly because we like everything to be above board and feel better that way. It is not rented out either.
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Old 30.09.2014, 11:59
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gift from parents: tax question

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No- but if they decide to investigate someone, for whatever reasons- they will. When our fiduciaire does our tax return, he requests all our bank yearly statement, both here and the UK, all statements of pensions, investments, ISAs (you can't contract ISAs when resident abroad- but you can keep thos you have already) etc, etc- so tax return can be completed honestly. Property abroad has to be declared- you might get away without declaring, but for us, it is not the way to go, because it can seriously catch up with you one day- but mostly because we like everything to be above board and feel better that way. It is not rented out either.

Well open a second bank account in CH preferably in VD or GE. Even if your investigated unless you have given details of the account a secret stays a secret. Why do you think numbered accounts even exist........

Tax evasion is an administrative matter, in ZH you will pay less wealth tax if you declare for the first 5 million as you can deduct 0.3% for managing your wealth, so disclosure saves tax.
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  #33  
Old 30.09.2014, 12:07
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Re: gift from parents: tax question

Tax evasion is just not our 'style' I'm afraid. I sometimes wish our taxes were used better- but I am glad they support our children, schools, hospitals, families, transport, etc, etc. If I can cut our tax legally and above board, I will do. And do you really think they are stupid- our apartment has been declared as an asset for 5 years, and so are our bank accounts and any investments- they would find it a bit strange if they vanish in next year's statement, non?
First 5 mio.... ahahaha.
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  #34  
Old 01.10.2014, 09:09
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Re: gift from parents: tax question

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Tax evasion is just not our 'style' I'm afraid. I sometimes wish our taxes were used better- but I am glad they support our children, schools, hospitals, families, transport, etc, etc. If I can cut our tax legally and above board, I will do. And do you really think they are stupid- our apartment has been declared as an asset for 5 years, and so are our bank accounts and any investments- they would find it a bit strange if they vanish in next year's statement, non?
First 5 mio.... ahahaha.
My point was, you may pay more tax by evading, than correctly filing, which is the situation in ZH & probably several other cantons. Why do you think withholding tax is 35%? In most cases people will be better off by declaring.

Obviously the tax dept benefit in ZH, so why would they get too bothered, if they investigate they will end up refunding money with interest.
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  #35  
Old 06.10.2014, 19:10
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Re: gift from parents: tax question

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Do you have to make an annual tax declaration or are you taxed at source.
If it's the latter then you have nowhere to declare it unless you make a voluntary declaration ( if that's even possible).
If it's the latter then you should declare it on your tax declaration but if the house is not in your name and you receive no income for it then who's going to find out? Not that I'm advocating tax evasion in any way, only you can decide if it's worth the risk.
Taxed at source, but it doesn't really matter I found out.(plus the house will be in my name) You have to go to the tax office and fill in a form, and it's better to do that voluntarily especially when you come from an E.U. member country (due to existing agreements which make tax evasion very difficult).
Anyhow, even I might be more Catholic than the pope himself now, I want to sleep well on my pillow...besides in time who knows we might really consider renting even though for the moment it's out of the question. (I like this house, I wish we could renovate and keep it for the times when we're visiting, but it doesn't make sense financially....sigh, wish so so much I could afford that!)
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  #36  
Old 19.02.2015, 12:37
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Re: gift from parents: tax question

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Have you googled this at all or just come to the forums?

When I researched this (expecting a sizeable gift of similar size from parents overseas as well), it seemed from all sources that gift tax is levied on the giver, not the recepient.

In any case, in Zurich, the limit for gifts from parents is CHF 200'000 and there's a really simple calculator here

http://www.steueramt.zh.ch/internet/...gssteuern.html

You might need to find a similar thing for your kanton. The below can also give you an idea.

https://www.credit-suisse.com/ch/pri...tabelle_en.pdf
Updated Credit Suisse link here: https://www.credit-suisse.com/media/...tabelle-en.pdf

If you are a US citizen, you musn't look at it. " This document may not be distributed in the United States or given to any US persons (within the meaning of Regulation S under the US Securities Act of 1933, as amended). "
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Old 22.08.2015, 12:46
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Re: gift from parents: tax question

HI,
I may be off topic a little but could not find better thread to follow.


My mother in law is 70 now and there is concern if she has to go to care facility the Kanton or Gemeinde will take her asset to pay for the care.
I understand that one can in essence take over the mortgage, become the new mortgage holder and if she remains healthy and at home for 10 years then the home remains ours. If however she has to go to care facility within that time then the home is sold to pay for her care or we have to pay the full amount of care.


Does anyone have knowledge of this, experience or even links (in English please)?
Also if I am completely on the wrong thread and there is a better one let me know.
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Old 22.08.2015, 13:27
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Re: gift from parents: tax question

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If you have a double income for one year then the tax office will surely notice, and it will be taxed. How can you spend one year salary without leaving any traces?

All gifts are taxed, so in my opinion it is best to send it back until you have found a way around the Swiss tax laws. Remember, anything over $10,000 is reported, and flagged as possible drug money. It might even be confiscated until the OP can supply a good story!
Hello. Is this still correct? 10'000 USA dollars? I had had Fr.5'000.-- (for Swiss accounts) in mind. What do you mean exactly, flagged? All cross border transactions (even digital/e-banking ones) are scrutinized and/or reported?
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Old 22.08.2015, 16:08
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Re: gift from parents: tax question

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HI,

My mother in law is 70 now and there is concern if she has to go to care facility the Kanton or Gemeinde will take her asset to pay for the care.
I understand that one can in essence take over the mortgage, become the new mortgage holder and if she remains healthy and at home for 10 years then the home remains ours. If however she has to go to care facility within that time then the home is sold to pay for her care or we have to pay the full amount of care.

Does anyone have knowledge of this, experience or even links (in English please)?
You should check with your MIL's Gemeinde; IIRC, in our Gemeinde/Canton any transfer/gift done less than 7 years before one claims that one is unable to pay for one's care is considered part of one's assets, and possibly can be reclaimed from the recipient. In looking at assets of the patient and family, a certain amount is excluded, only assets above that amount are considered for the patient's support.


HOWEVER... because there is so much game playing going on, local authority budgets are strained to the breaking point and more often now claims for Gemeinde support are being carefully looked over.

The safety net is there for those who truly need it, not to be abused by those who can afford to pay their own way. One is expected to fund one's own care, and the immediate family (one generation up and down - or is it two?) are the second line of support. Only when those assets above the exclusion have been exhausted should the community be expected to step in.

If one owns a home one is indeed expected to liquidate that asset if needed. And believe me - transfer of ownership without market value payment within the 7 (or 10 or whatever) years prior to moving into an Altersheim will be scrutinized very closely. At least in my Gemeinde - YMMV.

In our Gemeinde whether one is eligible for support depends not only on assets but also on citizenship or permit type. And FYI, If one seeks to bring an elderly relative here one first has to prove that one has the finances in place, now, to support that person for the rest of his/her life - to avoid the situation where the community is left holding the bag.

So bottom line: speak with the relevant authority in your MIL's Gemeinde for the exact rules. As with everything in Switzerland, local rules vary, as do local interpretations and enforcement of general rules. What happens in my Gemeinde might nor might not bear any resemblence to what happens in yours, even when the same laws govern us all.

IN any event, expect assisted living care to be expensive.


I hope a good solution can be found for your MIL, one that makes her happy and meets her needs.
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Old 22.08.2015, 17:12
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Re: gift from parents: tax question

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Hello. Is this still correct? 10'000 USA dollars? I had had Fr.5'000.-- (for Swiss accounts) in mind. What do you mean exactly, flagged? All cross border transactions (even digital/e-banking ones) are scrutinized and/or reported?
Transaction above 10k are flagged, so what? So salary is flagged each month for many, I did a £50k debit card transaction last week, I make 10k transfers on a regular basis business as normal.
It's all legal so I don't care in the least, my payment to the tax office will also be flagged.......
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