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Old 05.07.2012, 15:01
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Tax and social charge when working and living in different cantons

Hi all. I have a job offer. The HR told me two numbers related to the salary. The first number is the total cost for them in hiring me each year, and the second number is the amount after the social charge deducted (i.e. the employers part for the 1st/2nd pillar), and the second number will be the official salary in my contract.

The job will be in a different canton than where I live. I know that at least the personal income tax is calculated and taken by my residential canton rather than the canton of employer. But this will not affect the salary number in the contract as that is the gross income before tax deduction. My question is: what about the social charge? Is it also calculated by the residential canton? Is it the same percent everywhere? This might affect the actual number in my contract, as in the employer's point of view they want to fix their total cost rather than the number on my contract?

I hope I make my question clear... Thank you!
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Old 05.07.2012, 15:23
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Re: Tax and social charge when working and living in different cantons

As you are starting in Switzerland, for the first 5 years at least, you will be taxed at the rate for your place of work (Taxed at source), at the average cantonal tax rate.

Later when you get the magic 'C' permit your income tax will depend on your village post code, ie exactly where you live.

The state pension payments, invalidity insurance, unemployment insurance are the same fixed per centage deductions everywhere.

Your health insurance will depend on where you are living, and of course officially registered. This can also vary between different parts of your canton.
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Old 05.07.2012, 17:04
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Re: Tax and social charge when working and living in different cantons

My permit is EU-B, so you are right I am taxed at the source.

"The average cantonal tax rate" means the average of the rate of all 26 cantons? So it means I will have the same tax rate no matter which canton I live?

But this afternoon I called the canton where I live, and they gave me a different answer. They say that, because I live and work in different cantons and the tax rates are different, I have two choice:
1. Ask my employer to directly charge my tax every month according to my living canton.
OR
2. My employer can still charge my tax according to the working canton. At the end of year, I collect all my salary document and send to the authority of my living canton. They will recalculate my tax and make corrections accordingly. In my case, because the rate in my living canton is lower than the working canton, they will give me back some money.



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As you are starting in Switzerland, for the first 5 years at least, you will be taxed at the rate for your place of work (Taxed at source), at the average cantonal tax rate.

Later when you get the magic 'C' permit your income tax will depend on your village post code, ie exactly where you live.

The state pension payments, invalidity insurance, unemployment insurance are the same fixed per centage deductions everywhere.

Your health insurance will depend on where you are living, and of course officially registered. This can also vary between different parts of your canton.
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Old 05.07.2012, 17:51
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Re: Tax and social charge when working and living in different cantons

That arrangement is new to me.

Please read this book
http://www.amazon.co.uk/Living-Worki...1499980&sr=1-3

or paper http://www.amazon.co.uk/Living-Worki...1499980&sr=1-1
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Old 05.07.2012, 18:43
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Re: Tax and social charge when working and living in different cantons

Hi there

Actually, I can confirm happyrobbie's information.
I checked this with the tax office in Zurich for our service quitt.ch quite a while ago.

More precisely, I was told that an employer has two options:
1. Clear directly at the employee's living canton
2. Clear all employees at the canton of the company

Option 1 is easier for the employee since s/he does not have to take any actions at the end of the year. However, for large companies, option 1 is not viable because of the administrative overhead. Therefore Option 2 is commonly used.
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