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Old 05.05.2011, 09:08
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Re: Double Taxation Agreement

It's very simple. If you live in country A and are tax resident in A and B, then you pay taxes in A, as normal,,and submit a tax return to B. In your tax return you declare the taxes you paid in A, and that is deducted from your B liability. You then pay the difference. There are no refunds in double taxation - you pay the higher amount.

Given that, you need to work out your tax residency. You can be resident in more than one country. If you're in Switzerland for six months, then return to the UK, then you'll most likely be resident in both countries, and pay tax in CH, then the remainder in the UK.

Bear in mind that rates in Switzerland haven't fallen much in the last few years, but the exchange rate (to the UK) has altered dramatically. I'm convinced that agencies are using this to give what seems like a good rate to UK contractors, while enlarging their profit margin. It's what I would do...

You cannot work through your UK ltd co in Switzerland, except under very specific circumstances. You must go through a payroll company, or create a Swiss company, which takes 20'000CHF + a few K of fees.

Ittigen's loophole is almost certainly closed.
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