Go Back   English Forum Switzerland > Help & tips > Employment  
Reply
 
Thread Tools Display Modes
  #1  
Old 16.04.2018, 02:50
Newbie 1st class
 
Join Date: Apr 2018
Location: USA
Posts: 12
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
JPhillips has no particular reputation at present
Right for spouse to earn foreign income

Hi,
I've been following the boards for a while now but can't find an answer to my specific question. My wife and I are both US citizens, and we're moving to Switzerland where I'm taking a job as at a university as a research scientist. I will presumably get either an L or a B permit, organized through the university, but from what I can tell there is no guarantee which one.

My wife works for a US based company and will be continuing to work for this company while abroad. She's currently a salaried employee but they will switch her to an independent contractor and pay her in USD into a US bank account.

So my question is -- does this present a problem? From my understanding, an L visa would not necessarily give her a right to work, but is this only for a Swiss-based company? Is there any restrictions with either an L or B permit regarding foreign income?

Thanks!
Jason
Reply With Quote
  #2  
Old 16.04.2018, 21:06
3Wishes's Avatar
Moderately Amused
 
Join Date: Jul 2010
Location: Bern area
Posts: 8,961
Groaned at 50 Times in 48 Posts
Thanked 13,882 Times in 6,422 Posts
3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute
Re: Right for spouse to earn foreign income

Giving this a bump since it was posted around 2 a.m.
Reply With Quote
This user would like to thank 3Wishes for this useful post:
  #3  
Old 17.04.2018, 07:30
Newbie 1st class
 
Join Date: Apr 2018
Location: USA
Posts: 12
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
JPhillips has no particular reputation at present
Re: Right for spouse to earn foreign income

And just to add, I've seen some info about self employment and taxes, but my question is really just "can she work for a foreign company, regardless of my permit?" We can figure out tax implications later.
Reply With Quote
  #4  
Old 17.04.2018, 09:26
Forum Legend
 
Join Date: Oct 2009
Location: la cote
Posts: 3,018
Groaned at 18 Times in 11 Posts
Thanked 2,454 Times in 1,352 Posts
runningdeer has a reputation beyond reputerunningdeer has a reputation beyond reputerunningdeer has a reputation beyond reputerunningdeer has a reputation beyond reputerunningdeer has a reputation beyond repute
Re: Right for spouse to earn foreign income

Quote:
View Post
We can figure out tax implications later.
I wouldn't be so naive. You might need to discuss this upfront with the company to have some kind of compensation. She would be domiciled here, thus taxed here. And presumably you are US persons, so also subject to IRS taxation. So be well informed and prepared for the double whammy and what could or could not be offset.

Your situation may be further complicated as I think you said she would not be an employee, but would probably need to be self employed here. I let the permit experts chime in on that aspect.
Reply With Quote
This user would like to thank runningdeer for this useful post:
  #5  
Old 17.04.2018, 09:30
roegner's Avatar
Moderately Dutch
 
Join Date: May 2011
Location: Zurich
Posts: 8,498
Groaned at 298 Times in 245 Posts
Thanked 9,106 Times in 4,610 Posts
roegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond repute
Re: Right for spouse to earn foreign income

Have a look here to start:

https://www.startups.ch/en/blog/foun...gner-business/
Reply With Quote
  #6  
Old 17.04.2018, 11:29
Newbie
 
Join Date: Jul 2014
Location: Zurich
Posts: 7
Groaned at 4 Times in 2 Posts
Thanked 7 Times in 5 Posts
Bastie100 has made some interesting contributions
Re: Right for spouse to earn foreign income

Just quickly, only because she is formally switched to an independent contractor sceme does not necessarily mean that for Swiss social security purposes, she will be looked at as a self employed person. There are many facts to consider such as but not limited to: is she still using a company email address, how many different clients does she work for (if only one, then they might say she is economically dependend on this one client thus not self-employed), who provides her with the office utilities (laptop, mobile phone etc.). This is also something, the foreign "employer" has to consider because if she in fact is considered as employee, the foreign employer is liable for the duly computation of the social security contributions and the tax at source of her income (Quellensteuer) - the Swiss tax authorities usually follow the qualification of the social security authorities and vice versa. Further, if she is considered as an employee her job most likely would consider a permanent establishment of the foreign entity in Switzerland which triggers a limited corporate income tax liability here in Switzerland.
Reply With Quote
The following 2 users would like to thank Bastie100 for this useful post:
  #7  
Old 17.04.2018, 12:53
3Wishes's Avatar
Moderately Amused
 
Join Date: Jul 2010
Location: Bern area
Posts: 8,961
Groaned at 50 Times in 48 Posts
Thanked 13,882 Times in 6,422 Posts
3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute
Re: Right for spouse to earn foreign income

Quote:
View Post
And just to add, I've seen some info about self employment and taxes, but my question is really just "can she work for a foreign company, regardless of my permit?" We can figure out tax implications later.
Based on what I've read, she would not qualify as self-employed in Switzerland, because she only has one client (her current employer). In terms of taxes, that's probably not bad - because when you're self-employed under U.S. tax law you get to pay both employer and employee contributions for things like Social Security.

You'll both pay tax here as residents of Switzerland. You'll file taxes and FBAR with Uncle Sam. Whether you owe any tax to Uncle Sam will depend upon deductions and exemptions and whatnot.

Her permit is dependent upon yours. If you get L, she gets L. If you get B, she gets B.

Do you know which canton you'll be moving to? Contact their office of migration and ask how it works.
Reply With Quote
  #8  
Old 17.04.2018, 13:51
Junior Member
 
Join Date: Aug 2011
Location: Zurich
Posts: 32
Groaned at 0 Times in 0 Posts
Thanked 34 Times in 11 Posts
global_citizen has no particular reputation at present
Re: Right for spouse to earn foreign income

You might want to check out if something called ANoBAG is applicable in your case.
Here is a link from Zurich Canton.

https://www.svazurich.ch/anobag

Good Luck
Reply With Quote
The following 3 users would like to thank global_citizen for this useful post:
  #9  
Old 19.04.2018, 17:19
Newbie 1st class
 
Join Date: Apr 2018
Location: USA
Posts: 12
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
JPhillips has no particular reputation at present
Re: Right for spouse to earn foreign income

Thanks for the replies everyone. We've done a bit more searching but still haven't found a satisfactory answer.

I made the above comment about taxes not because we are pushing it off, but because we are already working with a US and a Zurich based tax firm to make sure we don't make any mistakes. But the problem is that they do not deal with permit issues. So they can advise on how best to deal with my wife's work situation from a tax perspective, but they cannot say outright if my permit will allow her to work.

Most of what I can find (including the suggested links) seem to be about if the main permit holder wishes to be self employed. But I still am unable to find anything about if there are any restrictions on the spouse of a permit holder earning overseas income. I'm not even sure this would count as "self employed", so it's not even clear to what regulations apply here.

If anyone has any other thoughts or experience with this it would be much appreciated. Thanks!
Reply With Quote
  #10  
Old 19.04.2018, 18:46
3Wishes's Avatar
Moderately Amused
 
Join Date: Jul 2010
Location: Bern area
Posts: 8,961
Groaned at 50 Times in 48 Posts
Thanked 13,882 Times in 6,422 Posts
3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute3Wishes has a reputation beyond repute
Re: Right for spouse to earn foreign income

I think it very much depends on the permit you receive as the primary permit-holder. If you receive a B then she can work, but self-employment would need approval from the cantonal authorities.

if you receive L then she's not allowed to work without prior approval and it seems self-employment is not allowed at all (if I am reading correctly).

Here are some relevant bits of posts by Medea that contain links which may help.

Quote:
View Post
...You need a good business plan and evidence of sufficient funds to keep you going while the business gets established.

https://www.ch.ch/en/self-employment/

https://www.kmu.admin.ch/kmu/en/home...ird-state.html

https://www.startups.ch/en/inform/details/forms/

If you can't meet the requirements then you won't be able to be self-employed.

Quote:
View Post
...

"Access to the labour market
Regardless of their nationality, persons who come to Switzerland by virtue of family reunification have the right to seek employment anywhere in Switzerland and in the branch of their choice. They may also work in a self-employed capacity."

https://www.sem.admin.ch/content/dam...nnachzug-e.pdf

"Art. 46 Employment of spouses and children

The spouse and children of a Swiss national or of a person with a permanent residence permit or a residence permit (Art. 42-44) may work on a salaried or self-employed basis anywhere in Switzerland."

https://www.admin.ch/opc/en/classifi...232/index.html

Permanent residence permit is C, residence permit is B.

If you want to be self-employed you'll need to present your business plan to the cantonal migration office, along with proof that you have sufficient funds to keep the business running while it gets established. If they're happy you can be self-employed, if they're not you can't.

https://www.kmu.admin.ch/kmu/en/home...efta-area.html

This is the difference between a C permit holder and a B permit holder. The C permit holder doesn't have to get permission to be self-employed, the B permit holder does.
Honestly the best thing you can do is contact the cantonal migration office where you plan to live and ask how it works, what proof is needed, etc. They're the ones that ultimately have to give approval. We can only make suggestions and offer links to help you search more.

Good luck!
Reply With Quote
  #11  
Old 10.01.2019, 07:34
Medea Fleecestealer's Avatar
Forum Legend
 
Join Date: Jul 2011
Location: Misery, but not the SoT one
Posts: 20,203
Groaned at 349 Times in 264 Posts
Thanked 14,682 Times in 8,435 Posts
Medea Fleecestealer has a reputation beyond reputeMedea Fleecestealer has a reputation beyond reputeMedea Fleecestealer has a reputation beyond reputeMedea Fleecestealer has a reputation beyond reputeMedea Fleecestealer has a reputation beyond reputeMedea Fleecestealer has a reputation beyond repute
Re: Right for spouse to earn foreign income

It's a bit of a grey area here on the forum, but this thread may help a bit.

https://www.englishforum.ch/permits-...-employer.html

I second 3Wishes advice to talk to the cantonal migration office, especially if you do get an L permit because the conditions for spouses working with those are different.

As for your other question, when I renounced I used US Tax & Financial Services to do my bit of FBAR filing/ They're not the cheapest, but never having anything to do with US tax I didn't want to try and do it myself. They have offices in Geneva and Zurich.

www.ustaxfs.com

The main things you need to be aware of is that the US tax system is based on citizenship, not residency as in the rest of the world, so you'll need to continue filing US tax returns no matter where you live in the world. To open a bank account here you/your wife will need to sign W-9 forms to allow the bank to send the account details on to the IRS. And any foreign, i.e. out side of the US, account/s that comes to an aggregate figure of more than $10,000 at any time of the year must also be reported on an FBAR form. A warning on this if your wife does decide to try the self-employment route. It's very unlikely she'd be granted a business account from a Swiss bank which may rule that option out.

Start researching your US filing obligations here:

https://www.irs.gov/individuals/inte...-living-abroad
Reply With Quote
  #12  
Old 10.01.2019, 14:25
Newbie 1st class
 
Join Date: Mar 2017
Location: Basel
Posts: 25
Groaned at 0 Times in 0 Posts
Thanked 40 Times in 14 Posts
dizzydee is considered knowledgeabledizzydee is considered knowledgeabledizzydee is considered knowledgeable
Re: Right for spouse to earn foreign income

I don't think there is any restriction on earning foreign income, even if a person is living in Switzerland on a spouse permit. I'm not sure where the OP got that idea in the first place. There may be limitations on finding employment in Switzerland, but not on getting paid from elsewhere. I can live in Switzerland and earn rental income, or director's fees for being on the board of a foreign company, etc.
All that matters is that all income is declared, wherever it is earned, and taxed accordingly, subject to double taxation agreements and your US status of course.
The work may be performed by her at home, which is technically in Switzerland, but I doubt the Swiss would disallow that as she is not depriving any Swiss person of a job.
Anyway, probably best you consult your cantonal office, as others have suggested. Tax consultants may also know the answer as they would have seen all sorts of situations.
Reply With Quote
Reply

Tags
permit, self employed, spouse




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
Moved to CH mid-year: what about previous foreign income? venetian Finance/banking/taxation 3 12.03.2017 09:14
Taxes for non-resident spouse's foreign income thakurain Finance/banking/taxation 4 03.05.2015 21:01
For US citizens, foreign income exclusion DavidSJC Finance/banking/taxation 24 23.12.2013 21:44
How to pay AHV+Tax on foreign income travnett Finance/banking/taxation 7 22.10.2011 20:47
Foreign spouse income used for tax rate? lapinblanc Finance/banking/taxation 4 29.03.2011 23:19


All times are GMT +2. The time now is 19:16.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2019, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0