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Old 01.04.2020, 15:19
Bloop Bloop is offline
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Re: Cantonal Tax on Vested Benefit when Leaving Switzerland

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SZ is canton of choice for the withdrawal possibility you describe.


But even more important than canton is for you to check the tax treatment of the withdrawal in your new country of residence. What's the point of saving some small X% in swiss tax when you risk having to pay XX% income tax on it to Canada?


The other two withdrawal possibilities:
  • withdraw the money right before you leave Switzerland. You will pay tax according to your last residence canton's rates, not the canton of your pension foundation. It's pointless to switch in this case.
  • withdraw the money while you're in tax residence limbo: after leaving Switzerland but before settling as a resident somewhere else. You pay tax according to domicile canton of pension foundation, so it makes sense to move the money to a foundation in SZ.
Thanks, Spark. We have left Switzerland already so cannot take advantage of being in tax limbo - you are the first person who has ever offered that information, none of the tax people I was speaking to at the time knew about it (or they were sitting on the info until I paid them) so I wish I had asked back when I left. Anyway, water under the bridge.

We would be doing a pension to pension transfer so there are no income taxes to pay in the target country. There is the possibility to perhaps claim back the WHT in Canada but we are looking into this.

What is slightly annoying is that my wife just paid $500 for a Canadian tax advisor who said he was an expert in Swiss taxes and he didnt know that the rates differed by canton.

Thanks to you both!
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