Go Back   English Forum Switzerland > Living in Switzerland > Business & entrepreneur  
Reply
 
Thread Tools Display Modes
  #1  
Old 20.03.2008, 11:11
ticino's Avatar
Forum Veteran
 
Join Date: Mar 2008
Location: Zurich
Posts: 861
Groaned at 36 Times in 25 Posts
Thanked 395 Times in 223 Posts
ticino is considered knowledgeableticino is considered knowledgeableticino is considered knowledgeable
Specific question on new dividend taxation rules (Teilbesteuerung)

I am considering forming a company (GmbH) to offer consulting services (already have first clients lined up). I expect to make sales of ~200K p.a. and wondered what the best way to limit my tax burden.

My idea is to set-up a company in Appenzell (flat tax of 12.5%) and then pay out all the earnings in the form of dividends which - to my understanding - would then be taxed at half the normal tax rate only (living in canton ZH) - so that would be another +/- 15% of income tax leading to total in the 25-30% range (maybe a bit less after deducting some expenses).

Does anyone have experience with the new Teilbesteuerungs rules regarding dividends (until last year, the dividends would have been taxed at full rate). Especially, I would be interested in understanding whether 1) its possible to pay out 100% of earnings as dividends and not receive any salary from my company and 2) what the implications on AHV and pension contributions would be. I.e., would I need to pay yet another 10% of AHV on the dividends paid out (this would start making me wonder whether CH is really the place to start a company since total tax/AHV burden in Austria would be lower)?

Thanks in advance for your replies!
Reply With Quote
  #2  
Old 20.03.2008, 11:46
ticino's Avatar
Forum Veteran
 
Join Date: Mar 2008
Location: Zurich
Posts: 861
Groaned at 36 Times in 25 Posts
Thanked 395 Times in 223 Posts
ticino is considered knowledgeableticino is considered knowledgeableticino is considered knowledgeable
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

CORRECTION - need to correct my previous post. The tax on the paid out dividends would be only 8% of course (roughly half of the +/- 15) - so total tax would amount to 20% which seems pretty attractive. Therefore, the question: Am I missing something and how will AHV kick-in?
Reply With Quote
  #3  
Old 20.03.2008, 21:24
Goldtop's Avatar
Forum Legend
 
Join Date: Feb 2008
Location: Zurich
Posts: 2,844
Groaned at 11 Times in 11 Posts
Thanked 905 Times in 625 Posts
Goldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond repute
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

Consider taking a modest salary and pay AHV on it. That would also entitle you to tax-deductible contributions to Pillars 2 and 3.
Reply With Quote
  #4  
Old 20.03.2008, 23:14
Goldtop's Avatar
Forum Legend
 
Join Date: Feb 2008
Location: Zurich
Posts: 2,844
Groaned at 11 Times in 11 Posts
Thanked 905 Times in 625 Posts
Goldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond repute
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

There may be some confusion on the concessionary taxation of dividends.
  • My understanding is that half the dividends will be taxed as income.
  • You seem to think that all the dividends are taxed at half rate.
Not the same thing! Please verify before deciding on the best mix of salary and dividend.
Reply With Quote
  #5  
Old 20.03.2008, 23:55
ticino's Avatar
Forum Veteran
 
Join Date: Mar 2008
Location: Zurich
Posts: 861
Groaned at 36 Times in 25 Posts
Thanked 395 Times in 223 Posts
ticino is considered knowledgeableticino is considered knowledgeableticino is considered knowledgeable
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

Quote:
View Post
There may be some confusion on the concessionary taxation of dividends.
  • My understanding is that half the dividends will be taxed as income.
  • You seem to think that all the dividends are taxed at half rate.
Not the same thing! Please verify before deciding on the best mix of salary and dividend.
That's what I understood from reading the text on the Steueramt's website - "Gemäss dem am 1.1.2008 in Kraft getretenen § 35 Abs. 4 StG werden ausgeschüttete Gewinne von Kapitalgesellschaften und Genossenschaften mit Sitz in der Schweiz zur Hälfte des für das steuerbare Gesamt-Einkommen anwendbaren Steuersatzes besteuert, sofern die steuerpflichtige Person mit wenigstens 10 % am Aktien-, Grund- oder Stammkapital beteiligt ist." - http://www.steueramt.zh.ch/html/home/index.htm

Maybe this is just the cantonal rule which differs from the one at country level?
Reply With Quote
This user would like to thank ticino for this useful post:
  #6  
Old 21.03.2008, 14:51
Goldtop's Avatar
Forum Legend
 
Join Date: Feb 2008
Location: Zurich
Posts: 2,844
Groaned at 11 Times in 11 Posts
Thanked 905 Times in 625 Posts
Goldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond repute
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

Thanks for the clarification.
A ZH calculation example is shown here:
http://www.steueramt.zh.ch/html/erla...zverfahren.htm

Apparently, no concessions on Federal income taxes.
Reply With Quote
  #7  
Old 24.03.2008, 21:54
ticino's Avatar
Forum Veteran
 
Join Date: Mar 2008
Location: Zurich
Posts: 861
Groaned at 36 Times in 25 Posts
Thanked 395 Times in 223 Posts
ticino is considered knowledgeableticino is considered knowledgeableticino is considered knowledgeable
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

Quote:
View Post
Thanks for the clarification.
A ZH calculation example is shown here:
http://www.steueramt.zh.ch/html/erla...zverfahren.htm

Apparently, no concessions on Federal income taxes.

Thanks a lot for your replies! I've also googled a bit and found some (German) articles about the new rules. It seems that the AHV is expected to introduce some form of "minimum" wage based on a 3rd party comparison to ensure that you cannot completely avoid paying AHV.
Reply With Quote
  #8  
Old 25.03.2008, 22:03
Goldtop's Avatar
Forum Legend
 
Join Date: Feb 2008
Location: Zurich
Posts: 2,844
Groaned at 11 Times in 11 Posts
Thanked 905 Times in 625 Posts
Goldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond repute
Re: Specific question on new dividend taxation rules (Teilbesteuerung)

Quote:
View Post
It seems that the AHV is expected to introduce some form of "minimum" wage based on a 3rd party comparison to ensure that you cannot completely avoid paying AHV.
The AHV is waived if the spouse is contributing. Otherwise, there has always been a minimum AHV. CHF 437 p.a. unless you have taxable wealth. See, e.g.
http://www.caisseavsfr.ch/de/que-fai...6-878-4-1-0-0/
Reply With Quote
Reply

Tags
freelance




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
taxation quick question chiswick Finance/banking/taxation 6 30.07.2007 18:12
Dividend Income Tax Doc Finance/banking/taxation 1 07.04.2007 11:55
Zurich London Commute [double taxation question] Shimla Finance/banking/taxation 25 16.03.2007 14:18
Taxation question - GmbH in Zug sanglier Business & entrepreneur 15 19.02.2007 15:06


All times are GMT +2. The time now is 12:07.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0