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Old 16.01.2011, 20:33
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Contract with non-Swiss company - self-employed or through payroll company

Hello everyone

As I'm moving to Switzerland (Vaud) in a very near future, I have been searching this forum looking for answers. Although I have found a lot of useful info, I haven't found an exact answer, so here goes my question (bear with me as I explain my situation).

My wife has been offered a full time job in CH and we will both get a B resident permits. I have been working a full time job in the UK, but as I'm relocating, my company has offered me a contract and a possibility to work remotely from Switzerland. I will be on around 115k CHF a year. Now, from what I have read so far, I've got 3 options to work legally while living in Switzerland:

- Use a local payroll company
- Self-employed (Einzelfirma)
- GmbH

I want to avoid the GmbH, as my contract may well be short term (a year), and I don't want to invest too much in it.

I have been in contact with a payroll company (Accurity) which offers their services for a 6% fee. After all deductions (AHV, ALV, ALFA, BGV, UVG, KTG and income tax), I'm left with around 65% of gross revenue going into my pocket. (Please let me know if anyone is interested in a detailed breakdown). I still have to claim any work-related expenses, including part of the rent for home-office, myself with tax authorities.

Could anyone help me with how this compares with the self-employed option? What are the deductions that you have to make? Is it manageable to do all the paperwork yourself (I'll be working for only one client, so shouldn't be complicated), or do you really need some professional advice from an accountant, and if so, how much do they charge? Most importantly, can you register as self-employed having only one client? I've seen contradictory posts on that here. Some are saying that you always need more than one client, and others have said that you can have one client if they are not Swiss based. I guess I could change to using the payroll company later if I started to be suspicious because of having only one client, or can you only register as self-employed if you can prove that you have more than one client? Is being self-employed worth it?

Thanks in advance!
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Old 16.01.2011, 23:58
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Re: Contract with non-Swiss company - self-employed or through payroll company

There is also a fourth option: remain employed by your current employer... your employer would need to sort out exactly what deductions they should make with the revenue authorities in the UK and you'd need to make a tax declaration here in Switzerland as well as make voluntary social security contributions, if memory serves me correctly. Any taxes deducted in the UK could be offset against Swiss taxes in accordance with the double taxation agreement between the UK and Switzerland.

I would suggest you consult an accountant about this.

Good luck,

Jim.
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Old 17.01.2011, 10:45
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Re: Contract with non-Swiss company - self-employed or through payroll company

Thanks for your suggestion Jim, but this is not really an option for me. My company's HR didn't want to deal with this situation, so the only way for me to continue working remotely was for them to put me on a contract. This has its good sides as the money is better.

Besides, isn't it better to pay taxes in Switzerland since they are lower comparing to UK?
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