I am in the process of purchasing a property here in CH, but am paying taxes by Quellensteur (?) at source (salary below cutoff for filing tax returns)

Can I deduct mortgage interest from taxable income and attempt to reclaim any. I am told that B permit holders might not be permitted, but I do not know how to find out for sure.

you could try on a tax return but you might find you can't. Did you consider contacting an accountant?

Of course - I considered it. But I am asking here first, in case someone can tell me the answer without charing me for saying "yes" or "no".

In truth, the mortgage is so much less than the rent that I have been paying that even if I cannot claim back any tax - I won't suffer too much. However if I can deduct interest and pay for the nominal rent, I may be slightly better off.

Hi Lorenheim,

Did you find out more along these lines. I'm just entering such a situation now myself and need to do the math.

Lob, maybe you can provide me with a useful reponse - Was it yourself who was able to swing a self-assessment by claiming foreign income. This could help reach the cutoff (of 120k or 150k?)

The tax office people said (and note that someone else who speaks the language better did this for me)
"When you buy a property, you will be required to submit a tax form - and on this form you can put all the usual expenses/in/outgoings etc"

I take this to mean that I will have to fill in a tax form and I will be able to declare interest payments and pillar 3 payments etc. How the tax office actually process this and decide whether or not anything can be refunded or taken into consideration - I'm still not sure.

Not sure if this helps. I'll post again if/when I've investigated further

Apologies - I meant to reply to pmacaodh - but clicked on the wrong message when typing mine.

This is correct, you will be moved from tax at source (quellensteuer) to direct taxation (direktbesteurung) the month you buy the property. This happened to us and it is built into the federal tax law, its not cantonal.

Daniel

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Unless you previously had large undeclared income other than employment and/or your property has a very high value (hence taxable income value (eigenmietwert) and you have very low mortgage interest, there is something wrong with the differential.

Under direct tax in Zug, taxable income of 120chf you would pay 14kchf taxes and at 240kchf 46kchf, nowhere near 30%. Interestingly quellensteuer tables show 35kchf for 240kchf of gross salary, so I assume there are large deductions available in Zug.

D

Is this process completely automatic, by which I mean, do I have to contact the tax office and make enquiries/requests - or will they be notified by the office dealing with the land registration and start the process without intervention on my part. Shall I notify my employers etc...

thanks

it may be just me, but I am totally pi$$ed off about the number of accountants/lawyers I come across here who bill CHF 300 per hour, but cannot seem to actually follow my instructions, much less interpret the complexities of some regulation.

I just fired my tax accountant who caused me to lose almost 5 grand because he neglected to reply to a notice that the steueramt sent him (for me). The one i hired to replace him, has called me twice to ask questions that have been explicitly answered in the documents i gave him this morning ...

sorry to sort of hijack the thread, but i read about the accountant and couldn't help venting a bit of steam ..

This should probably be split off:

I have paid 300CHF an hour for the lawyer to take down the law books & read the passages to me, but then gave me no interpretation of them.... now way to know what I was supposed to do next. Yeah, I read the law myself! Thanks for that!