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Old 15.11.2013, 15:55
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Benefits - kids education invoices and tax

Hello,

I am reimbursed 100% schools fees by my company for some time... but is done on the gross incomes (per tax laws in Switzerland), which means I receive less than what I pay back against schools fees invoices.

Does someone knows if I will be refunded the difference by the tax office (Basel). I contacted them but they did not really answer me. Or let's be fair, I may have not well understood.

So my question is not whether about benefits being considered a gross income (I know that ). It is: will I be refunded at some point ?

Thank you
pit
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Old 15.11.2013, 16:26
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Re: Benefits - kids education invoices and tax

No, if anything they may send you an additional bill.

Tom
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Old 15.11.2013, 17:06
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Re: Benefits - kids education invoices and tax

Am I reading this correctly? Your company reimburses you nearly 100% for sending your children to private school...and you want the government to make up the rest so basically your kids go to private school for free?
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Old 15.11.2013, 17:10
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Re: Benefits - kids education invoices and tax

The reimbursement is taxable, and will definitely push your tax bill up, and very little can be claimed back.

My husband's salary, plus a taxable tuition discount because our children attend school where he works, plus a bonus that was paid in one single year, pushed the total gross taxable salary over the 120K threshold, by 500chf

The tax difference between Quellensteuer (tax at source) and the tax return, was a 5000K tax bill the first year, 4800 the second year, 4500 the third year. The reason why it is dropping is because we moved out of Stadt Zuricht to Stadt Adliswil, and because one of our kids moved from private to government school, so no taxable fee discount.

Unfortunately, it's a big loss for us, because for a 500chf amount, in one year (the first full year after we arrived) - we are stuck with the higher tax rates.

The only way we can drop the tax rate back down is to move to a lower tax area or canton...

I would suggest speaking to a tax agent and getting it sorted out so that you at least have an idea of what sort of extra bill (or not) you might end up getting.

However, if your overall gross taxable salary is under 120K then generally you don't have to worry about tax returns, I think unless you have international investment accounts or own property outside Switzerland...
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Old 15.11.2013, 18:11
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Re: Benefits - kids education invoices and tax

Hi Swisspea,

Sounds like I better talk again to the tax office and see what looks like my taxes soon before further bad surprises..

@ 3 wishes: the 100% reimbursement (against the invoice) occurs before taxes are applied on gross incomes. And those high taxes applies on ALL incomes = suddenly taxes can become quite heavy.

pit
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Old 15.11.2013, 19:12
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Re: Benefits - kids education invoices and tax

Are you taxed at source?

If so, you will want to make sure that they don't reimburse you all at once.

Tom
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Old 25.11.2013, 14:48
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Re: Benefits - kids education invoices and tax

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Are you taxed at source?

If so, you will want to make sure that they don't reimburse you all at once.

Tom
Unfortunately... Left me to pay a 5 digits part of the bill out of my pockets. Hurts a bit for a "benefit".

The tax office looked at my overall situation and told me I shall receive a form for tax return in Feb 2014.

I will know more in a few months it seems. Happy to share at the time if some of you wonder (have to remember though).

Lesson learned. Will now know what a 100% "Swiss" reimbursement benefit looks like.

pit
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Old 25.11.2013, 15:01
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Re: Benefits - kids education invoices and tax

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Unfortunately... Left me to pay a 5 digits part of the bill out of my pockets. Hurts a bit for a "benefit".

The tax office looked at my overall situation and told me I shall receive a form for tax return in Feb 2014.

I will know more in a few months it seems. Happy to share at the time if some of you wonder (have to remember though).

Lesson learned. Will now know what a 100% "Swiss" reimbursement benefit looks like.

pit
still, you had to pay the taxes only, giving you a good benefit.

next time, ask for a net reimbursement
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Old 25.11.2013, 15:09
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Re: Benefits - kids education invoices and tax

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Lesson learned. Will now know what a 100% "Swiss" reimbursement benefit looks like.
Just an FYI - you will run into the same issue in most countries - it isn't necessarily a Swiss thing.

In every country we have lived, the benefits attached to an expat contract have been taxable - the value of that benefit is added to income and the whole shebang is then taxed.

Some companies use a gross-up formula to allow for the tax increase. But that really doesn't solve the problem. The gross-up-for-additional-taxes amount is of course added to your taxable income, generating further tax... and so it goes.

Death and taxes. No getting around 'em.

My 5Rappen, having done this many times: Look at the larger picture. Given all benefits and all costs - are you on the whole better off here, or at home?

All the best...
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Old 06.10.2019, 01:14
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Re: Benefits - kids education invoices and tax

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Unfortunately, it's a big loss for us, because for a 500chf amount, in one year (the first full year after we arrived) - we are stuck with the higher tax rates.

The only way we can drop the tax rate back down is to move to a lower tax area or canton...
Hi Swisspea, I know this is an older thread but could you possibly elaborate on why you were "stuck" in the higher tax rates after the first year? Did your income support the higher rates or in essence were you locked in to the higher rate that you had in the first year, is this a Swiss tax law? I am trying to understand more about Swiss tax.
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Old 06.10.2019, 02:13
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Re: Benefits - kids education invoices and tax

First world problems thread was the most suitable for this.
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Old 06.10.2019, 10:19
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Re: Benefits - kids education invoices and tax

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Hi Swisspea, I know this is an older thread but could you possibly elaborate on why you were "stuck" in the higher tax rates after the first year? Did your income support the higher rates or in essence were you locked in to the higher rate that you had in the first year, is this a Swiss tax law? I am trying to understand more about Swiss tax.
Until you are a permanent resident (C permit), you will be taxed at source, using a set rate which is the average of the tax rates in the communities in the canton (each community gets a slice of tax and can set its own rate). If you're income is above 120K though, you have to fill in a tax return, and your actual tax liability is calculated. If it's higher, you have to pay more, if it's lower, you get a refund.

With the Swisspeas, and extra payment one year pushed them into the "must do tax return" bracket, from which they cannot escape without changing where they live.

With me, I was always doing a tax return, but because of where I lived, I got a small rebate each year.
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