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Old 11.04.2017, 12:23
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Quellensteuer in Kanton ZH

Good day!

I think we lost quite some money...

My wife and I are living and working in Kanton ZH on a B bewilligung, paying our quellensteuer. Me and my wife have the gross of our income as employees, still my wife does some "freelance work" as Midwife.

Due to this freelance work everybody said we should fill in a normal tax form, which we did for 2014, 2015 and 2016. We even got a guy to do it for us, to do it right. So we put our loans and our discounts (kids, 2e Saeule, 3e Sauele)...

My assumption was: we fill in that form, it will give us our "Steuerbares Einkommen" on which they will calculate how much taxes we have to pay. As we already paid "quellensteuer", they will use this amount to pay the taxes due. NOPE.

Today I was on the phone and the guy from Steueramt said no: quellensteuer is gone, we only use the form to check if the freelance work needs to be taxed.

So I went searching and found that for quellensteuer paying people there is a different form: Antragsformular für eine Korrekturberechung der Quellensteuer". Bug is, in Zürich one has to handle in this form until 31 March of subsequent year: that is, for taxes paid 2015 until March 2016, for taxes paid in 2016 until March 2017. We lost both...

I contacted our Tax guy and he didn't know about it.

Does anyone have any experience about extending this Period? I do accept that for taxes in 2015 we are really to late, but at least 2016??

any experience from fellow forum members?

Many thanks and best regards, Erik
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Old 11.04.2017, 12:32
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Re: Quellensteuer in Kanton ZH

If you earned more than 120k gross in some year, then in that and all following years they should process your tax return and your tax liability should be ordinary taxes minus Quellensteuer.

If it was all less than 120k, then you had no right to ordinary taxation. And tax return if you filed any is indeed just for assessing and taxing extra income not covered by QS, this procedure is called an "ergänzende Veranlagung zur Quellensteuer". Deadline for QS corrections is March 31, you're out of luck now if you wanted to claim pillar 3 and other extra deductions.
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Old 11.04.2017, 12:32
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Re: Quellensteuer in Kanton ZH

How did you get hold of the normal tax forms?
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Old 11.04.2017, 12:35
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Re: Quellensteuer in Kanton ZH

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If you earned more than 120k gross in some year, then in that and all following years they should process your tax return and your tax liability should be ordinary taxes minus Quellensteuer.

If it was all less than 120k, then you had no right to ordinary taxation. And tax return if you filed any is indeed just for assessinf and taxing extra income not covered by QS, this is called an "ergänzende Veranlagung zur Quellensteuer". Deadline for QS corrections is March 31, you're out if luck if you wanted to claim pillar 3 and other extra deductions.
Together we have indeed a bit more than 120k gross in both 2015 and 2016, but I think this value applies to only one of us?

Yes, out of luck is what I think indeed
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Old 11.04.2017, 12:41
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Re: Quellensteuer in Kanton ZH

Spouses are taxed together. If you both together earned above 120k brutto, I think that should entitle you you to ordinary taxation. Did you point this out to Steueramt?

Otherwise, yes, if you did pillar 3 and can't get a refund for it, this is very unfortunate. Tax refund is the only reason ever to do it. But on other hand if you lived in an expensive commune like Stadt Zürich with higher than average municipal tax rate, ordinary taxes are usually higher than QS, so that's a plus and you saved some money there
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Old 11.04.2017, 12:50
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Re: Quellensteuer in Kanton ZH

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How did you get hold of the normal tax forms?
Steueramt will give you the forms if you ask, especially if you tell them that you have extra non taxed at source income and hence need them. But the fact that they hand them out doesn't entitle you to ordinary taxation.
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Old 11.04.2017, 12:55
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Re: Quellensteuer in Kanton ZH

The limit of CHF 120'000 for ordinary taxation applies to one person, i.e. it applies only if one of the spouse's gross income is above.

I also had the impression that 120k limit is for combined income but then I got this clarification from tax department.
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Old 11.04.2017, 12:59
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Re: Quellensteuer in Kanton ZH

Yeah bad luck! you should have filled up this form before March 31 https://www.steueramt.zh.ch/dam/fina...ng_2016_v3.pdf

Unfortunately no extension is possible. I am surprised that you tax advisor did not know the facts.
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Old 11.04.2017, 13:00
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Re: Quellensteuer in Kanton ZH

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Spouses are taxed together. If you both together earned above 120k brutto, I think that should entitle you you to ordinary taxation. Did you point this out to Steueramt?

Otherwise, yes, if you did pillar 3 and can't get a refund for it, this is very unfortunate. Tax refund is the only reason ever to do it. But on other hand if you lived in an expensive commune like Stadt Zürich with higher than average municipal tax rate, ordinary taxes are usually higher than QS, so that's a plus and you saved some money there
Hi ivank,

many thanks for the reply!

With "Did you point this out to Steueramt?" do you mean that I pointed this out today, when asking them how they proceed with taxation? Or do you mean I should make a special statement in the Steuererklärung itself?

Many thanks again, Erik
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Old 11.04.2017, 13:18
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Re: Quellensteuer in Kanton ZH

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The limit of CHF 120'000 for ordinary taxation applies to one person, i.e. it applies only if one of the spouse's gross income is above.

I also had the impression that 120k limit is for combined income but then I got this clarification from tax department.
Just checked this https://www.steueramt.zh.ch/dam/fina..._nr_28-851.pdf

and the 2nd page does indeed state the above
"Verheiratete und in ungetrennter Ehe lebende quellensteuerpflichtige
Personen unterliegen gemeinsam dem Verfahren der nachträglichen
ordentlichen Veranlagung, wenn die quellensteuerpflichtigen Bruttoeinkünfte
eines der beiden Ehegatten den Schwellenwert gemäss
Randziffer 1 überschreitet"
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Old 05.09.2017, 12:18
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Re: Quellensteuer in Kanton ZH

Update: A couple of weeks after start of this thread I called the Steueramt and explained the whole situation, and the response was positive for me!

As said before, the gross of our income is subject to quellensteueur, and we do a tax form because of some freelance work done by my wife. All deductions (2e, 3e saeule) we just filled in on the tax form, expecting it to be deducted from the paid quellensteueur.

The lady looked at our 2015 form and said: indeed, you have much more deduction posts than income from freelance, so, after we (steueramt) have done the whole tax form, we will forward it to the department that does the "neuveranlagung Quellensteuer", so they the deductions to reduce the quellensteuer. And indeed, a couple weeks later we for a letter we dont have to pay any taxes on the freelance income, and that we had an "Abzugsüberhang", which means exactly the above (more deductions than income) So, it is ok: our 2015 is now at the guys from the quellensteuer, so I expect that somewhere in 2019 we will have an answer regarding 2015.

A long time ago I read about a price for people that found a term that would give only 2 results in google. With the "Abzugsüberhang" I found one that gives 3 replies only, and none is related to the quellensteuer - which I find quite amazing (that this question has apparently not popped up before).

cheers, Erik
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Old 11.09.2017, 10:38
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Re: Quellensteuer in Kanton ZH

But they won't refund you for the excess paid?

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Update: A couple of weeks after start of this thread I called the Steueramt and explained the whole situation, and the response was positive for me!

As said before, the gross of our income is subject to quellensteueur, and we do a tax form because of some freelance work done by my wife. All deductions (2e, 3e saeule) we just filled in on the tax form, expecting it to be deducted from the paid quellensteueur.

The lady looked at our 2015 form and said: indeed, you have much more deduction posts than income from freelance, so, after we (steueramt) have done the whole tax form, we will forward it to the department that does the "neuveranlagung Quellensteuer", so they the deductions to reduce the quellensteuer. And indeed, a couple weeks later we for a letter we dont have to pay any taxes on the freelance income, and that we had an "Abzugsüberhang", which means exactly the above (more deductions than income) So, it is ok: our 2015 is now at the guys from the quellensteuer, so I expect that somewhere in 2019 we will have an answer regarding 2015.

A long time ago I read about a price for people that found a term that would give only 2 results in google. With the "Abzugsüberhang" I found one that gives 3 replies only, and none is related to the quellensteuer - which I find quite amazing (that this question has apparently not popped up before).

cheers, Erik
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Old 11.09.2017, 11:28
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Re: Quellensteuer in Kanton ZH

Hi

Last week we received the letters from the "neuveranlagung" team that indeed we are going to get some money back – it was much faster than expected!

Their procedure: they sent a sheet with our gross monthly income in the first column, and more columns for the deductions. They split the 3e Saeule and Kinderbetreueung equally over the 12 months, obtained a new gross income and recalculated the due Quellensteuer %. The difference between already paid and due is, in this case, returned to us.

For me this was not much of a "problem", as I have a steady income. But my wife has varying income, some months 2000, few months 8000, and as they split the 3 Säule equally over the 12 months, we "lost" some on that, but that is ok.

One warning! They have "Pauschal"/standard values for work related deductions, in my case 10% of the gross income. I had actually less than that in our Tax form, and they added the difference to my gross income. So, if you have little work related deductions, and no further deductions, do not request a neuveranlagung, as you are going to pay more quellensteuer. Example: The Pauschal in my case was 8400 CHF, so if you have only 4800 on work related deductions, they are going to take that diffence (3600 CHF), divide by 12 and add the 300 CHF to your monthly income and recalculate quellensteuer on this higher income!

Cheers, Erik
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Old 07.01.2018, 12:11
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Re: Quellensteuer in Kanton ZH

Just a reminder. For those who are subject to Quellensteuer (Source Tax) in Cantons Zurich and Zug, there is a 31 March deadline of the following year to make corrections and claim a refund, i.e., 31 March 2018 for tax year 2017. Deadlines may vary by canton, such as Basel Stadt which has a 30 September deadline and Aargau which allows corrections up to five years after the tax year:

Deductions to decrease the taxpayer's income resulting in a refund can include, with variation by canton. (These are key deductions but may not be complete for all cantons):

1. Interest paid, e.g., mortgage interest
2. Pillar III pension contributions
3. Additional Pillar II pension contributions
4. Education and continuing education costs
5. Child care costs paid to a third-party, e.g., a Kita
6. Alimony costs and child support for separated/ divorced couples
7. Weekly cross-border commuter costs
8. Financial support of other individuals
9. Church tax (Aargau)

Be sure to review the form to determine the corrections allowed and the maximum values for your canton.

In some cantons, unearned income and assets exceeding a threshold must also be declared on the Quellensteuer correction form.

The form has various names by canton, such as:
- Zurich: "Antragsformular für eine Korrekturberechung der Quellensteuer"
- Zug: "Tarifkorrektur Steuerjahr"
- Basel Stadt: "Antragsformular für Tarifkorrektur und Rückerstattung der Verrechnungssteuer und des zusätzlichen Steuerrückbehalts USA"
- Aargau: various forms depending on the correction
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Old 08.01.2018, 09:45
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Re: Quellensteuer in Kanton ZH

Good info!

The form for Zürich is this one:

https://www.steueramt.zh.ch/dam/fina...ng_2017_v4.pdf

cheers, Erik
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Old 23.06.2018, 21:10
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Re: Quellensteuer in Kanton ZH

The thread seems abandoned, but I think we also might fall into the category of lost money

Both my wife and I pay quellensteuer from our salary (B permit, non-EU, but I recently changed to EU, another story...). Both our salaries are under 120K/year.


We have been paying into 3a account and filling for refunds, which has worked. However, as the form does not mention investment incomes, dividends etc, I have never applied for refunds from some of our investments in shares.

Does anyone has experience with claiming back withholding tax from dividends being in this situation? Should we voluntarily switch to full tax declaration?

Thanks!
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Old 23.06.2018, 22:06
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Re: Quellensteuer in Kanton ZH

To reclaim foreign withholding taxes, you would need to complete a Ct. Zurich ordinary tax return under the "ergänzende Veranlagung bei der Erhebung von Quellensteuern" process. See A.4 at this link for support:


https://www.steueramt.zh.ch/internet...zstb-93-1.html


Also, if your income from dividends and other unearned sources is greater than CHF 2'500 or your assets exceed CHF 200'000, you are required to complete a tax return under the above process, even if your earned income is less than CHF 120'000.
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Old 23.06.2018, 23:04
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Re: Quellensteuer in Kanton ZH

Thanks Mullhollander!

You say "foreign withholding taxes", I guess this applies also for dividends from Swiss companies?

"Also, if your income from dividends and other unearned sources is greater than CHF 2'500 or your assets exceed CHF 200'000, you are required to complete a tax return under the above process, even if your earned income is less than CHF 120'000."

Where is this from? We are above the threshold for both dividends, and assets. I was once told that if we are in Quellensteuer the Steueramt would send us the paperwork if they decide we should start filling a complete return.
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Old 24.06.2018, 02:24
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Re: Quellensteuer in Kanton ZH

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However, as the form does not mention investment incomes, dividends etc, I have never applied for refunds from some of our investments in shares.
What refund?? You want your divs tax free? No can do

If we're talking about US shares/ETFs, you can pay just 15% withholding with a proper broker setup, that's the theoretical minimum that everyone pays, you can't get below it normally

Quote:
Should we voluntarily switch to full tax declaration?
You don't have a right to. Go earn more money, at least one has to earn 120k+

Quote:
Also, if your income from dividends and other unearned sources is greater than CHF 2'500 or your assets exceed CHF 200'000, you are required to complete a tax return under the above process
No the process is different in this case, it's just to compute if you owe them any extra taxes, not for refunding the difference, for the latter you still need to escape poverty and earn 120k+
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Old 24.06.2018, 09:48
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Re: Quellensteuer in Kanton ZH

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Thanks Mullhollander!

You say "foreign withholding taxes", I guess this applies also for dividends from Swiss companies?

Yes, also applies to reclaiming Swiss withholding tax. "4 Sind diese Schwellenwerte nicht erreicht, so werden die Verrechnungssteuern, die auf Vermögensertrag, ... erhoben worden sind, auf Antrag zurückerstattet."

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"Also, if your income from dividends and other unearned sources is greater than CHF 2'500 or your assets exceed CHF 200'000, you are required to complete a tax return under the above process, even if your earned income is less than CHF 120'000."

Where is this from? We are above the threshold for both dividends, and assets. I was once told that if we are in Quellensteuer the Steueramt would send us the paperwork if they decide we should start filling a complete return.

A.3 states it: "3 Ein ergänzendes Veranlagungsverfahren wird nur durchgeführt, wenn das der Quellensteuer nicht unterworfene steuerbare Einkommen mindestens Fr. 2'500 oder das steuerbare Gesamtvermögen mindestens Fr. 200'000 beträgt."



You will need to request a tax form and the accompanying Personal Identification Code to file.



Good luck to you!
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