Hi,
I am working in Canton Vaud and paying the D - tariff tax rate, as my husband works as well and he is on B tariff. Both of us are taxed at source.
My HR guy told me to file a yearly tax return as he thinks I am paying too much taxes and could possibly gain by declaring returns.
I also hear from the accountant I called that I have to get a tax declaration number from the local tax office to do these tax returns.
- In case I am not liable to get any money back, I dont want to go through the unnecessary hassle of declaring a tax return every year. But I will know whether I get a refund or not only when I go to my accountant, who will not do the returns without a declaration number.
So, if I get this number, is there an obligation to file a tax return or is it ok if I still not do it as long as they don't come behind me?
Hope I made my question clear.
Thanks for your help.

Are you earning more than 120k a year together? If so, I thiiiiiink you have to file anyway (certain on the 120 threshold, not so certain on whether it's individual or joint, but assuming joint as tax in CH is by household not individual).

If not, then download the free Vaudtax software from the cantonal website and play with the numbers to see if you're due any money.

kodokan

Yes I am. But did not know about this rule earlier. Are there any penalties if we do not do this?

I think you do have to make a tax declaration.

The amount taken at source is in some instances a provitional amount which is then adjusted as you make your declaration. A colleague of mine got stung by this and had to pay an extra 5 k CHF - ouch! Lovely Christmas present!

Also, note that the accountants don't always get it right. The number we're given is usually correct give or take a few hundred CHF, but the auhtorities may evaluate things slightly differently - especially if you are deducting allowances (e.g. mortgage payments, travel allowance, house expenses etc.).

How many tax years are we talking about here?

kodokan

possibly only one..if you consider a full period from april to april.

A full period in Switzerland is 1 January to 31 December.

ok...but I actually consulted an accountant long back and he said that if they dont chase, you dont have to declare it..And apparently they chase if they have to get money and stay quiet if we have to get money.
So are you sure that we have to do it even if they havent asked us to?

Not 100%, no. I'm going on UK-based knowledge that it's the responsibility of the individual to declare any taxes due, and that 'But you didn't send me a tax return' doesn't cut it as an excuse with the tax authorities.

And surely, by your accountant's reckoning, if they haven't asked you to do one, they must owe you money..?

Vaud is notoriously slow at tax stuff. We've passed everything necessary onto a tax acct for 2008 (our first year here, so the acct was a relocation deal) but last I heard in mid-Dec she hasn't yet been able to return in the return as she STILL hasn't received a tax number for us. Madness.

But really, download the VaudTax software and see who owes who. My impression is that the tax at source is slightly weighted in favour of the authorities for obvious reasons. It also matters where you live - the 'commune' part of the at source tax is averaged across the whole canton, whereas we live in a commune with a very low tax rate, so we're hoping to make good here when we FINALLY get a tax notice for 2008. And we put money in the 3rd pillar, too - have you done anything like this?

kodokan

Does anyone knows what are tax bands?

It's not that simple. I assume you mean for tax at source? (Which is almost certainly what you'll be on as an incoming foreigner.) For example, here's the table for the 2010 tax at source rates in the Canton of Vaud (each canton has its own table like this):

http://www.vd.ch/fileadmin/user_uplo...if_AB_2010.pdf

As you can see, someone bringing in 100,000 chfs a year will pay between 16.79% and 2.28% tax on those earnings, depending on whether they're single or married with 6 kids.

And then if you earn over 120k, you then fill in an end of year tax return, which calculates using a slightly different set of rates.

And then there's also a wealth tax.

'Tax bands' in the UK sense just doesn't apply here.

kodokan

Thank you Kodokan

Can you recommend any comprehensive guide/website to taxes in Vaud?
and what "tax at source" actually mean?
thank you

Sigh... you've caught me in a good mood, killing time waiting for iTunes downloads - and you did say thank you nicely - but there really is a lot to be discovered on the forum by searching and reading other threads...

Anyhow, here's the website explaining more than you'd ever need to know about tax in Vaud: http://www.aci.vd.ch/. It's in French, though - this info doesn't exist in English, just to save you the bother of looking.

And tax at source is like PAYE in the UK, done automatically by your employer along with the equivalent of NI, pension subs, etc. Swiss citizens don't do it that way; they receive their money gross and then pay a tax bill at the end of the year. You can't choose which system to use; B permit (which you'll almost certainly get if you're an EU citizen) = tax at source.

The table I linked to before is fairly self-evident: find your projected annual salary, track across the columns until you hit on your family situation and that's your own personal tax band. It applies to the whole amount; there are no tax-free 'first 6k' type allowances like in the UK.

kodokan

Thank you very much Kodokan,
Just what I was looking for, shame that there isn't any of that info in english
Hope your itunes downloads are completed successfully now.

You can find information about taxation at the source here: http://www.vd.ch/fr/themes/etat-droi...impots/source/

Basically, all foreign workers not in the possession of permis C are subject to this tax unless their annual salary exceeds CHF 120,000.

If taxed at the source, the employer and not you submits the declaration. It may vary in different cantons, but usually you can make few deductions, basically only your payments into the 3rd pillar and little else unless you are a home owner, in which case you are also ordinarily taxed.

Contact your tax authorities and rectify your situation, it seems that you can make savings, taxation at the source is the least advantageous tax situation you can find yourself in.

And if you do hold a B (or other non-C permit) and earn over 120k, you are still taxed at source each month during the year, but then at the end of the calendar year you have to submit a tax return. Then you cross your fingers and hope they give you some of the 'deducted at source' money back again. We'll see, we'll see... like I said, I'm still waiting to have the right number/paperwork from the tax authorities to actually submit the return for 2008.

Never mind - hopefully they'll owe me money, and they pay better interest than the bank.

kodokan

Honestly, have a read through the threads for the last couple of years, you'll learn tons.

Yes thanks, found a brilliant set of podcasts for my daughter as part of my 'teach her to read in English' campaign. She'll do anything if I give her an iPod to play with rather than a dull old textbook.

kodokan

Hi there,
Thanks for that insight. I did not think they would be this slow in providing a tax declaration number! That is insane.
I will check the vaudtax software, thanks for that info too.
About the 3rd pillar..no I havent..I have to read a lot! sigh.
Good day..

Hi,
I downloaded the vaud tax software, but it does not proceed without the declaration number, which I have not got yet.
Can I not do a simulation without giving my reference number?

Also, one more question: I am trying to find the rate at which we would be taxed when we do our final tax declaration as a couple. I have seen the A/B/D tariff pdfs in the Vaud website for impot a la source, but would it be the same for the couple's earnings taken together?

Thankyou..

000.000.00

will work!