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Old 25.01.2019, 20:26
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How to get overpaid tax back?

I just started a new job and they gave me a sign on bonus with my first monthly salary.

For some reason the tax on this was ridiculously high; I basically paid nearly half my first paycheck in taxes. (Lets say if the salary was roughly 10K, the bonus was roughly 40K, and I got just under 30k out of 50k in my account.)

Someone said that this is because you are taxed at source, and in their computations they assume you are making that much money every month. If that's true (can someone confirm please?), that means I've paid the tax of someone who makes several times what I really make.

My question is this:
1- Is there a way to get this money back relatively quickly? I imagine it works out in the long-term with tax returns and whatnot, but I have a lot of relocation expenses and was depending on the sign-on bonus to cover that..)

2- If, hypothetically, the job doesn't work out and I quit or if the company decides not to keep me past the probation period, how do I get the overpaid tax back? (Assuming I don't have to return the bonus)
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Old 25.01.2019, 20:32
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Re: How to get overpaid tax back?

You didn't overpay, the amounts sound correct.

If you make over a certain amount, you are required to file a tax return, which will be next year. Then, after some months or years, they will either send you a bill or a refund.

I got my bills for 2013-2017 all within the past six months, for example.

Tom
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Old 25.01.2019, 20:40
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Re: How to get overpaid tax back?

Your location says London. May I suggest you change it at least to the two letter designation of you current canton.

Let us assume it is Geneva, than you are out of luck unless you make CHF 500'000 per year. For other cantons the limit is considerably lower CHF 120'000 to be exact. If you are above the limit you will have to do a full tax return at beginning of next year and you will get a refund (if there is one) some when later. Like 3 - 48 or more months.
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Old 25.01.2019, 20:42
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Re: How to get overpaid tax back?

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If you are above the limit you will have to do a full tax return at beginning of next year and you will get a refund (if there is one) some when later. Like 3 - 48 or more months.
Thanks for confirming!

Tom
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Old 25.01.2019, 20:44
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Re: How to get overpaid tax back?

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2- If, hypothetically, the job doesn't work out and I quit or if the company decides not to keep me past the probation period, how do I get the overpaid tax back? (Assuming I don't have to return the bonus)
There is no overpaid tax, and if you don't work the whole year your tax rates will be higher, not lower.

Tom
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Old 25.01.2019, 20:56
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Re: How to get overpaid tax back?

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Your location says London. May I suggest you change it at least to the two letter designation of you current canton.

Let us assume it is Geneva, than you are out of luck unless you make CHF 500'000 per year. For other cantons the limit is considerably lower CHF 120'000 to be exact. If you are above the limit you will have to do a full tax return at beginning of next year and you will get a refund (if there is one) some when later. Like 3 - 48 or more months.
Hi, thanks for your reply. Sorry for the misinformation, I was in London when I made my account; it was before I moved here. I have updated it. I live in Zug, work in Zurich, and I make more than 120k a year.
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Old 25.01.2019, 20:58
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Re: How to get overpaid tax back?

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Hi, thanks for your reply. Sorry for the misinformation, I was in London when I made my account; it was before I moved here. I have updated it. I live in Zug, work in Zurich, and I make more than 120k a year.
So in several years you will either get a bill, or a refund.

But not sooner.

Tom
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Old 25.01.2019, 21:01
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Re: How to get overpaid tax back?

Zürich - in my case - took about 2 years on average to get it sorted out (2016 is now done, haven´t heard anything yet on 2017, so that fits)
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Old 25.01.2019, 21:02
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Re: How to get overpaid tax back?

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There is no overpaid tax, and if you don't work the whole year your tax rates will be higher, not lower.

Tom
Thanks for your reply.

When I say overpaid tax, I mean in proportion to the year.

When I enter my details into an online tax calculator, it tells me that my yearly taxes are about 15% of my income, and total yearly tax is 30k.

Now in my first paycheck alone, I have been taxed at over 30%, for an amount of 20k. This seems considerably higher than what I was expecting.

Do you pay more taxes if you don't work the whole year? I am coming from the UK, where you pay a tax based on how much you make per year. So if you are on a salary of 80k, you pay an even monthly contribution to your yearly tax every month. But if you stop working for 6 months, then you have been paying half the taxes of an 80k income, which is more than the tax of a 40k income, so you would be able to get a refund on the difference.

Is it different in Switzerland?
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Old 25.01.2019, 21:06
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Re: How to get overpaid tax back?

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Thanks for your reply.

When I say overpaid tax, I mean in proportion to the year.

When I enter my details into an online tax calculator, it tells me that my yearly taxes are about 15% of my income, and total yearly tax is 30k.

Now in my first paycheck alone, I have been taxed at over 30%, for an amount of 20k. This seems considerably higher than what I was expecting.
That is because you are taxed at source. IN the end it will work out for your percentage, just not that month because with that amount you landed in a way higher tax bracket. You didn´t overpay, you paid what was the bracket for that amount.

As said, you can file a return and get some money back, just not now
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Old 25.01.2019, 21:07
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Re: How to get overpaid tax back?

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Thanks for your reply.

When I say overpaid tax, I mean in proportion to the year.

When I enter my details into an online tax calculator, it tells me that my yearly taxes are about 15% of my income, and total yearly tax is 30k.

Now in my first paycheck alone, I have been taxed at over 30%, for an amount of 20k. This seems considerably higher than what I was expecting.

Do you pay more taxes if you don't work the whole year? I am coming from the UK, where you pay a tax based on how much you make per year. So if you are on a salary of 80k, you pay an even monthly contribution to your yearly tax every month. But if you stop working for 6 months, then you have been paying half the taxes of an 80k income, which is more than the tax of a 40k income, so you would be able to get a refund on the difference.

Is it different in Switzerland?
Say that you make 120k salary, and got 40k bonus.

So, if you work a whole year, you get taxed on 160k, at the 160k rate.

If you work 6 months, you get taxed on 100k, but at the 200k rate.

If you work one month, you get taxed on 50k, but at the 600k rate.

(assuming that you leave the country after you stop working, or only arrived here for X months before the end of the year)

Tom
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Old 25.01.2019, 21:12
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Re: How to get overpaid tax back?

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Is it different in Switzerland?
It is the same. But if you are a resident for only part of the year then you will be taxed like you have always earned the same average as you did during your stay.

PS: Are you taxed according canton Zurich rates or Zug rates? It should be Zug, the place where you live, which is considerably lower than Zurich.
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Old 25.01.2019, 21:16
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Re: How to get overpaid tax back?

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Say that you make 120k salary, and got 40k bonus.

So, if you work a whole year, you get taxed on 160k, at the 160k rate.

If you work 6 months, you get taxed on 100k, but at the 200k rate.

If you work one month, you get taxed on 50k, but at the 600k rate.

Tom
Right, exactly.

So my question is this: If I quit working now, and I got paid 50k in the year but paid tax at the 600k rate, then it would seem that I have paid more tax than I should have, based on my yearly income of 50k. Is there a way to reclaim this excess tax?

Others have posted about an end of year tax return, but is it possible to get it sooner?
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Old 25.01.2019, 21:17
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Re: How to get overpaid tax back?

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It is the same. But if you are a resident for only part of the year then you will be taxed like you have always earned the same average as you did during your stay.

PS: Are you taxed according canton Zurich rates or Zug rates? It should be Zug, the place where you live, which is considerably lower than Zurich.
My work said they taxed me based on Zug, which is why I am surprised that it is so high.
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Old 25.01.2019, 21:18
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Re: How to get overpaid tax back?

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Right, exactly.

So my question is this: If I quit working now, and I got paid 50k in the year but paid tax at the 600k rate, then it would seem that I have paid more tax than I should have, based on my yearly income of 50k. Is there a way to reclaim this excess tax?

Others have posted about an end of year tax return, but is it possible to get it sooner?
No
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Old 25.01.2019, 21:20
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Re: How to get overpaid tax back?

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Right, exactly.

So my question is this: If I quit working now, and I got paid 50k in the year but paid tax at the 600k rate, then it would seem that I have paid more tax than I should have, based on my yearly income of 50k. Is there a way to reclaim this excess tax?

Others have posted about an end of year tax return, but is it possible to get it sooner?
You have only overpaid if you stay here unemployed for the full year. If you stop working and leave, then you have not overpaid.

And no, expect at least a two year wait, 1 1/2 if you are very lucky.

In short, the tax rate on the 50k will be that of 50k if you are here a whole year, 100k if you are here 6 months, and 600k if you are here 1 month.

Tom
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Old 25.01.2019, 21:40
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Re: How to get overpaid tax back?

Also, the tax return is not at the end of the year, but March or April of the following year.

Then several months or years to process, depending on their mood, the phase of the moon, and whatever.

And, of course, any other worldwide income that you have will serve to increase your tax rate.

Tom
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Old 25.01.2019, 21:54
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Re: How to get overpaid tax back?

Winterthur(kt zh) is pretty efficient. We get our final tax bill about 3-6 months after filing, and the federal portion a month or two after. We file a full return (C permits, not taxed at source).
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Old 25.01.2019, 22:06
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Re: How to get overpaid tax back?

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Winterthur(kt zh) is pretty efficient. We get our final tax bill about 3-6 months after filing, and the federal portion a month or two after. We file a full return (C permits, not taxed at source).
They probably do the foreigners first.

Tom
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Old 25.01.2019, 23:04
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Re: How to get overpaid tax back?

We moved to Switzerland at mid November of that year. My husband received his salary for 1.5 months (probably +pro-rated 13th salary) but after we filed a declaration in March of the next year, we received a refund of about 6K. I think the same will happen for you.
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