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Old 26.06.2020, 23:43
natn natn is offline
Join Date: Jun 2020
Location: Lausanne
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Massive increase in tax due to filing a declaration

Hi all, I'm new here, and wondering if anyone has had a similar experience of having to pay a lot more tax on income (like +30%) after filing a tax declaration compared with paying at source.

My wife and I have been working and paying tax at source in Switzerland for a few years, then in 2019 we decided to take the widely given advice and try to optimise our taxes by paying into the third pillar and filing a simplified tax declaration in Vaud were we we live and work.

It turns out the trap was that because we declared a total combined global wealth over 100k or so, we can't used the simplified process, and have to fill in a full tax declaration for 2019.

But when I entered our numbers copied from a salary statements into the VaudTax 2019 software it says we have to pay nearly 1/3 more tax than we did at source! Even after adding all the usual deductions, it's still a couple thousand more that before! And that's without factoring in any wealth tax.

We tried using the official help line though they just said that tax at source and tax based on a declaration works differently and couldn't explain further. But this seems crazy! and surprising given that I've not found any explanation or warnings about it online! Can this be normal?

I thought maybe it's because we were not being taxed as a couple before (despite declaring everything to our employers), but that doesn't seem to explain it, because if I fill in the VaudTax form as if we had a child then it's still about 14% more than at source.