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Old 07.05.2017, 17:01
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Tax declaration - medical expenses

Hello,

I have some questions for the tax declaration (so far I never did it myself and used a professional. I'm thinking about trying alone this year, I'm gathering the documents now):

I have a copy showing my insurance premiums.

My insurance can provide a summary of medical expenses for 2016 (below the franchise of 2500).
But I pretty much never send them the expenses since they (Assura) say that I should only bother doing that if expenses are going above the franchise). I also have expenses abroad.
So here is my question: for declaring taxes, I think there is a minimum for medical expenses. Is that true ? how much is it ?

If my expenses are below the franchise but above the amount for tax declaration, should I send the expenses to Assura and ask for a summary of expenses or should I just send the expenses to the tax authorities ?

Thank you
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Old 07.05.2017, 17:09
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Re: Tax declaration - medical expenses

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So here is my question: for declaring taxes, I think there is a minimum for medical expenses. Is that true ? how much is it ?
Too much. 5% of net income. And only the part above 5% is tax deductible. So if you didn't reach the deductible of your insurer, chances are high you don't reach this figure either.

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If my expenses are below the franchise but above the amount for tax declaration, should I send the expenses to Assura and ask for a summary of expenses or should I just send the expenses to the tax authorities ?
No need to go through Assura if they are not going to compensate you anything. Just attach copies of receipts and fill in the numbers on corresponding form of tax declararation (Krankheits- und Unfallkosten)
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Old 07.05.2017, 18:15
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Re: Tax declaration - medical expenses

What you may be able to claim is the insurance premiums themselves. Here in Fribourg we can claim 8,760 as a married couple.
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Old 07.05.2017, 18:29
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Re: Tax declaration - medical expenses

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What you may be able to claim is the insurance premiums themselves. Here in Fribourg we can claim 8,760 as a married couple.
Here too. We can claim 4500chf per person for the insurance premiums.
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Old 07.05.2017, 22:38
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Re: Tax declaration - medical expenses

thanks for the answer.

my medical bills are small (less than 5% of the income) so there is no need to add paper work and give free information, right ?

I looked at the declarations made by a professional from the last year and he put 4000 for the insurance premium (in zurich), attaching my bill which is much less (the cheapest available, so more like 2k or so).

The software does not give you what are the "pauschal" amounts. But it seems that 2600 is the maximum (after deducting income on savings). How come we do not have to justify the 2600 ? (in my case, he declared 4000, with a bill of about 2k...)
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Old 07.05.2017, 22:46
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Re: Tax declaration - medical expenses

I assume it's a set figure same as it is here in Fribourg.
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Old 07.05.2017, 22:54
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Re: Tax declaration - medical expenses

Health insurance premiums deduction is not pauschal in ZH (but in other cantons it may be). You're supposed to deduct the actual costs you've paid. Whether they'll bother checking it and asking for receipts is a different matter. Unlikely if the cost is plausible. Plus yes, there's that cap on the bottom line which limits the deduction anyway.

Declaring a higher amount, technically, is a tax evasion, but it's not really a crime or anything, you'll just pay missing taxes and possibly some rather mild fines if caught.

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he put 4000 for the insurance premium (in zurich), attaching my bill which is much less (the cheapest available, so more like 2k or so).
That wasn't a very smart thing to do at all. You didn't have to send this bill with the tax declaration, only upon request. They'll likely now correct 4000 down to 2000.
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Old 07.05.2017, 23:26
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Re: Tax declaration - medical expenses

thanks.
I can't believe that I paid this guy 3 years in a row and he makes stuff like this. I realize now he only put 1 of my 2 bank accounts. Obviously missing the big one (savings account).

I will ask him explanations.

One thing I don't understang is the "verschierungspämien" part.
From what I understand, you add up the premiums you pay for the different insurances plus the return on capital (that makes total A). Then you compare it to the total B (calculated by software) and the smallest (then called C) is what you can deduct.
What is the logic of deducting your return on capital ???
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Old 08.05.2017, 01:00
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Re: Tax declaration - medical expenses

Also one more question (not related to medical expenses anymore):
I am not sure I understand the part "Werschriften erfassen"

I have started to describe my accounts and securities in that part.

I have an account with cash, structured products, funds and shares (capital gains and dividends).

The year end reports is about 10 pages and 1 page shows the initial wealth , the adjusted wealth (+net flows - anticipated tax) and the final wealth (+net income + anticipated tax + change in value)

My tax advisor only declared the "adjusted wealth" and the "net income" (in column A). In support, he attached the summary page (so no details about funds, structured products and shares.)

Is it normal to declare it that way and not detail (in my case funds, structured products and shares) ? Why does he declare the "adjusted wealth" and not the final wealth? Would I get taxed twice if I declare final wealth (after income and capital gains) and income ?I find it strange because my capital gains should count in wealth, right ?

Last edited by varioplus; 08.05.2017 at 01:12.
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Old 08.05.2017, 01:46
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Re: Tax declaration - medical expenses

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I can't believe that I paid this guy 3 years in a row and he makes stuff like this. I realize now he only put 1 of my 2 bank accounts. Obviously missing the big one (savings account).
Deducting 4000 on the form or "forgetting" some small savings account is not really a problem. Many tax advisors would optimize your tax declaration with little things like this that they know most likely won't get questioned. The dumb thing to do was to send at the same time a receipt for only 2000.

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One thing I don't understang is the "verschierungspämien" part.
From what I understand, you add up the premiums you pay for the different insurances
Not any insurance, just health, accident and life insurance premiums are deductible here

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plus the return on capital
No, you can deduct here mainly just the interest from your savings accounts. Dividends don't belong here, you'll pay full tax on them. And capital gains aren't taxed at all.

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Then you compare it to the total B (calculated by software) and the smallest (then called C) is what you can deduct.
What is the logic of deducting your return on capital ???
I fail to see any logic in lumping these unrelated things together, but that's what the law says is deductible. Art. 33 DBG 1g

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I have an account with cash, structured products, funds and shares (capital gains and dividends).
For cash and each security you should declare:

1) wealth (Steuerwert): its market value in CHF as of 31.12 - this is used to compute your wealth tax, as well as for sanity checking that you didn't hide any income, didn't suddenly become rich out of nowhere compared to last year's declaration

2) income (Bruttoertrag): dividends and interests that you've received during the calendar year from it, gross amount including any withholding taxes. Depending on whether the security was subject to 35% swiss withholding tax or not, it goes into column A or B. If this tax was levied, it goes into column A, and the form automatically computes at the bottom how much you should get reimbursed ("Ihr Verrechnungssteueranspruch"). You'll get it usually as a tax credit for next year, not in cash. Only swiss withholding tax counts here, not foreign. For stocks with foreign withholding taxes, use DA-1 and/or ask the foreign country to reimburse you.

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The year end reports is about 10 pages and 1 page shows the initial value, the adjusted value (net flows - anticipated tax) and the final value (net returns + anticipated tax + change in value)

My tax advisor only declared the "adjusted value" and the "net returns" (in column A). In support, he attached the summary page (so no details about funds, structure products and shares.)
This is some really unorthodox and confusing terminology and looks possibly wrong. For example, if by "anticipated tax" you meant 35% swiss withholding tax, then in column A you should write gross dividend income including this tax, not net of it.

Let's just go through a simple example. You had shares in a swiss stock or fund that were worth 10000 CHF at 01.01. and 11000 CHF on 31.12. It paid out 300 CHF of dividends, of which 35% = 105 CHF were withheld, and so you actually received only 195 CHF. Then the correct thing to declare is: 11000 CHF as the wealth and 300 CHF as income in column A. The form at the bottom will then correctly deduce that 105 CHF will need to be reimbursed to you. The difference in initial and final value: 11000 - 10000 = 1000 CHF is capital gains, they aren't taxed and don't need to be declared.

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Is it normal to declare it that way and not detail (in my case funds, structured products and shares) ?
Normal way is to declare each security individually. But if you attached your brokerage statement with per-stock data and put just the total onto tax form, that should be fine too. A friend of mine does this out of laziness. However that means more work for the tax office if they want to check that everything is correct between the form and your brokerage statement, so they can tell you to not do it again next time.
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Old 09.05.2017, 00:38
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Re: Tax declaration - medical expenses

awesome. Thank you very much ivank, this is very helpful.

I realize that even more mistakes were done (not as bad as forgetting savings though...).

I'm happy that I feel more confident to declare the taxes myself, not to save a 100ish on tax advice, but because I can't trust this guy.

The hardest part is to collect the documents, which you have to do anyway. Going through the assistant is easier and quicker than setting up 2 appointements with the advisor.

Thanks again!
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