Hi,

My wife has recently found a job in Zurich and we'll move to Switzerland very soon. I'm working with a company in US and would like to continue working with them for a while from Zurich. The idea is I'll be working from home and they plan to send my paychecks to a US bank.

Now the question is what should I do about my taxes?! I'm not a US citizen so hopefully I don't need to worry about US federal taxes but what about Swiss tax? Would I be considered self-employed? Could I declare myself self-employed? (i.e. would it work with my B permit that's going to be dependent on my wife's B permit?).

Thanks a lot,
AlefSin

You pay taxes in the country you live in.
Where you "live" is mainly subject to where you spend the majority of your time. So if >50% of time is spent in Switzerland, then you live here.

The Swiss tax authorities charge tax on your worldwide income and worldwide assets.

It doesn't matter where your employer is located, you are still employed. It is actually quite common here to live in Switzerland and work over the border eg in Germany, France, Italy or Liechtenstein.

So your situation is nothing unusual.
Live in Switzerland, employed in USA.

I'm curious. Live here, pay here. Ok. But I expect the US will want to tax the income that's paid to the US bank account? I would expect, as we do, pay taxes in Switzerland, file and pay taxes in the States if the tax would be higher there.

What right do the US have to tax you if you do not live or work in the USA...??

And if the earnings are not earnt in the USA?

Sure, interest earnt in the USA ban account will be subject to USA taxes, but not money earnt outside of the USA

Any concerns, then get the wages paid into a non-US bank account.

The US of A being a very progressive country likes to remind its citizens of their civic duty by taxing them regardless of where in the world they choose to reside

FriendlyKiwi this is the second thread in which today you're answering my questions. Thanks a lot.

Well as far as I understand if I'm going to live abroad for longer than a certain number of months per year I don't need to pay federal taxes to US. I'm not a US citizen and I'm going to live in Switzerland for the whole year so I guess I should not pay US taxes anyway.

The problem that the compnay has with paying to a swiss account is with IRS as it might look suspicious especially after that little incident they had recently with UBS bank accounts some US citizens used to evade taxes.

What I don't know is how to approach the Swiss tax and who to talk to about my permit.

Taxing authorities have a tendency to do what they want to do.

I expect, that "elfensin", as he has worked in the US, has a green card? Green card holders pay taxes to the states independent of where they work.

If he receives a paycheck in from a US company, most likely they will withhold social security and taxes, unless he's self employed. He will have to file in the US to get these taxes back.

A US company may run into problems paying wages to a foreign account it they don't have a foreign office.

Appreciate any feedback

Go to ETH and talk to the people who are assisting your wife. Ask them for contacts and advise?

Actually I don't have a green card. I used to live in Switzerland between 2001 and 2007 (PhD student and then work). Since 2008 I'm working here in US on a H-1B (anyone who says B permit sucks should try a H-1B to see the real dark side!).

harshbarger: even if I'm not a US citizen, I don't have a green card and I will not live in US, the company has to withhold social security and taxes?

hmmm, maybe I should try to declare myself self-employed and work for this company as a consultant? Would it make things easier?

I will try that but I'm not sure they can help much. These things in universities are done in a certain ways and they don't really know much about other cases. I had that experience when I wanted to get a normal B permit after finishing my PhD in EPFL.

You are married, right? Your wife already has a fixed job offer and promise of work permit. So, as her husband you will get work/residence permit. So, in essence yes, you will file Swiss taxes on your COMBINED worldwide Income. There is no other option in Switzerland.

You state that you are not a US citizen, but how about green card, did you have a work visa when you were working in the US? You must have! Oh, yes, just read above. Fine. H-1B. Understood.

The company must file all the same tax forms (W2, 1099, etc.) and therefore you should still have to at least file a US tax return (note that you may qualify for many exclusions etc and not actually pay anything). Your US employer should also NOT withhold tax I believe. Social security yes, you have a US social security number correct? they must withhold Social Security then (unless you set your self up self-employed, which I don't think it's worth it). Like Harshbarger said above.

Now your wife, is SHE a US citizen?? Then it gets complicated. You need a tax advisor specialising in both Swiss and US tax laws to get you through correctly.

Yes, employed in the US, the company has to pay social security, federal and state taxes based on your residency in the US; residency in your case is what the company has on file for you.

Even if you are self-employed in the U.S. you'll have to fill tax return to IRS.

Good luck.

Thanks BruceFan. You comments are helpful. Yes I do have a SSN. No my wife is not a US citizen either. She is starting a post-doc in ETHZ so she'll get a restricted B permit and mine will depend on hers.

Re: the self-employment on "dependent B". You have to ask when you make the B permit application. If you are highly qualified, you *may* get it.

BUT you have to ASK and show all your degrees, qualifications, business plan maybe even... you are a special case as it sounds like you have a science PhD and are fairly specialized? The authorities *like* that. Use it.

I hate to burst your bubble, but the source of your income is the
US. The IRS will receive either a W-2 or 1099 depending on whether
you are an employee or a free lancer.

Since the source of your income is the US, the tax liability will be there.
What the Swiss authorities taxwise will require is not a question that I can answer.

hmmm, it's true that to pay my salary they will need to send it to a US bank account which in return will need a US address. I was going to use the address of a friend or try one of these: http://www.earthclassmail.com/

But having and address is not equal to living in US, is it? It seems I have a more complicated issue with the US side of this deal than the swiss side

But do I have any other option? This company does not have a Swiss office. Can it hire me in Switzerland?

And yes, I do have a PhD (from EPFL in fact) and my work is rather special.

It's not really complicated, it's just f*$^ing paperwork.

You have until June 15 to file with the IRS since you are moving overseas. There are forms for this, to even make the extension longer. There is a foreign income exclusion... search the Forum there is tons of information on it. Remember the FBAR!! I'm a bit lazy this morning too...

My US bank (Bank of America) allows me to do totally Online Banking now and uses my Swiss address, although I first set it up in an Address in NY but online (where my brother lived). Where are you now? I'd get this squared away before you leave the US.

Swiss side is paperwork paperwork paperwork too!

The other option is that you declare to the swiss authorities you are still working in the US (temporarily, of course, until you find a job here?), but want to live here with your wife. That is totally fine, as your wife is working, you should have the right to work too. Whether you will get a Swiss job or not, that is not their problem. You just have to declare your worldwide income to the Swiss tax authorities.

in essence, you would be a "US-based" freelancer/telecommuter/employee according to your US employer (you should ask for a specific contract spelling out this telecommuting role is a continuation of your previous/current role and they don't want to fire you or let you go! and show this to the Swiss authorities), and a "Swiss-based" husband. It's weird, but it's doable. But you just have to be honest and tell them what you are doing! Don't worry so much!

True, but the OP stated he is not a US citizen