Tax on a holiday home - Page 2

Cashboy · #21 08.09.2010, 17:12

	Quote:	Syt
	The "Eigenmietwert" (valeur locative) is the theoretical rental value the tax authorities computes to properties occupied by the owner or used by him. It does not apply to properties rented out (in that case only the rental income is added to the other income, not the rental value). If a second house is partly rented out and partly used by the owner (let's say 50/50), then the rental income for the 6 months will be added to the other income and the theoretical rental value for the other 6 months will be added also. The full rental value does not come in addition of the rental income, only the part that correspond to own use. The tax saving door quickly opens: how will the tax authority know how much days you have rented it out and how much days you occupied it for your own usage? It depends what you declare on the tax return. And I would clearly try to reduce as much as possible the part of own occupying... (if I had a second house indeed...)

That makes more sense to me.

However, I am very surprised that the actual rent for a period would be less than the theoretcial rental value for two reasons:
1) The theoretical rental value would be based on a family being there all year and possibly many years; not a short tenancy.
2) If renting short periods; say two weeks here and two weeks there, you would expect higher rents for those periods.

Let us say that one had any empty second home in Switzerland and decided that they wanted to bring some undeclared cash into Switzerland.
If they were to suddenly introduce this into the bank; you would have to pay tax on it as income or you would not have declared it as capital.
If however, you had an empty apartment, you could then put this in the bank and pretend that you have rented your second home out. There would be no tax implications on the income because you would be paying tax on the "theoretical rental value" anyway.

AbFab · #22 08.09.2010, 18:15

	Quote:	Cashboy
	That makes more sense to me. However, I am very surprised that the actual rent for a period would be less than the theoretcial rental value for two reasons: 1) The theoretical rental value would be based on a family being there all year and possibly many years; not a short tenancy. 2) If renting short periods; say two weeks here and two weeks there, you would expect higher rents for those periods. Let us say that one had any empty second home in Switzerland and decided that they wanted to bring some undeclared cash into Switzerland. If they were to suddenly introduce this into the bank; you would have to pay tax on it as income or you would not have declared it as capital. If however, you had an empty apartment, you could then put this in the bank and pretend that you have rented your second home out. There would be no tax implications on the income because you would be paying tax on the "theoretical rental value" anyway.

The theoretical rent is just that and varies from community to community and is not really a realistic amount - just as rates were not in the UK. Eigenmietwert is, in my experience of two properties, well under the real rental value - thankfully.

As for bringing in large amounts of cash the best way I have found is to say that you inherited it from an uncle who just died in the UK as there is no inheritance tax here...

Charlie R. Soles · #23 08.09.2010, 18:25

	Quote:	AbFab
	As for bringing in large amounts of cash the best way I have found is to say that you inherited it from an uncle who just died in the UK as there is no inheritance tax here...

I think you will find that this is a Cantonal issue rather than federal, in some cantons there is an inheritance tax depending on how close the relative is.

However if you don't mention it and aren't too flamboyant with the money there is little risk.

Another point you could also take into consideration is as taxation is a Cantonal issue, keeping your money in a different canton is relatively risk free. You just need to do everything at the counter, no transfers between Swiss accounts other wise a link is formed, but you can transfer between a UK accoung and the "other canton account" with impunity.

Cashboy · #24 08.09.2010, 19:10

	Quote:	Charlie R. Soles
	I think you will find that this is a Cantonal issue rather than federal, in some cantons there is an inheritance tax depending on how close the relative is. However if you don't mention it and aren't too flamboyant with the money there is little risk. Another point you could also take into consideration is as taxation is a Cantonal issue, keeping your money in a different canton is relatively risk free. You just need to do everything at the counter, no transfers between Swiss accounts other wise a link is formed, but you can transfer between a UK accoung and the "other canton account" with impunity.

The governments of the Ewst will be trying more an more to tie up tax avoidance and evasion as they are desperate for monies as the welfare costs go up and the deficit costs go up.

One has to be more and more imaginative.

I also expect the UK to introduce capital tax at a later date as people will be the only ones to get anything off in the future.

I am surprised and would expect this to soon be tied up; quite easy with duplicates (name, address) on a data base.
The only way to move money is in cash in a bag and keep it in a deposit account and the deposit account to be in a foreign limited company name if possible.