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Old 23.02.2021, 21:09
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Taxation at source -> how to change to a normal taxation

Hi.

I relocated to Zurich back in October 2020. I've been taxed at the source and paid Quellensteuer calculated by my employer.

I would like to switch to a normal taxation regime and calculate the tax from my total annual income, not based on a monthly Quellensteuer tariff.

I contacted the tax authority 2 times already via the online form and requested them to send me the Zugangscode for the annual tax report. However, I got no response from them. The tax office is currently closed due to corona restrictions.

Does anyone know whether am I eligible to calculate my tax on annual basis and where can I request the Zugangscode?

Thank you.
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Old 23.02.2021, 21:29
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Re: Taxation at source -> how to change to a normal taxation

See here. https://www.englishforum.ch/finance-...ax-2021-a.html

This is now the fifth time the same question has been asked recently.

Last edited by NotAllThere; 24.02.2021 at 09:46.
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Old 23.02.2021, 21:48
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Re: Taxation at source -> how to change to a normal taxation

a) marry a Swiss

b) get a c-permit

c) become Swiss

d) earn over CHF 120k in most places, 500k in Geneva

Tom
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Old 24.02.2021, 09:47
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Re: Taxation at source -> how to change to a normal taxation

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a) marry a Swiss

b) get a c-permit

c) become Swiss

d) earn over CHF 120k in most places, 500k in Geneva

Tom
e) Since January 2021 - just apply for it. You still get tax deducted at source of course. If you don't want that, then a) b) and c) only.
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Old 24.02.2021, 14:37
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Re: Taxation at source -> how to change to a normal taxation

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e) Since January 2021 - just apply for it. You still get tax deducted at source of course. If you don't want that, then a) b) and c) only.
But does that mean that I can apply for it now and do the tax assessment for the year 2020? Or the earliest possible date to apply for it will be for the annual tax assessment of the year 2021?
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Old 24.02.2021, 16:48
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Re: Taxation at source -> how to change to a normal taxation

Even on normal taxes, your tax rate will be extrapolated for the year, so you most likely won't save anything, it may even cost you more.

Tom
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Old 24.02.2021, 16:54
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Re: Taxation at source -> how to change to a normal taxation

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I would like to switch to a normal taxation regime and calculate the tax from my total annual income, not based on a monthly Quellensteuer tariff.
It will be the same, if not worse.

Tax is calculated on the pro-rated income, i.e. if you work for three months, multiply that by four to get your tax rate.

Tom
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Old 24.02.2021, 17:15
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Re: Taxation at source -> how to change to a normal taxation

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But does that mean that I can apply for it now and do the tax assessment for the year 2020? Or the earliest possible date to apply for it will be for the annual tax assessment of the year 2021?
Did you invest in 3a? If not, and if you live in Zurich city, its probably going to be disadvantageous to submit a tax return given the high geminde tax rate.

If you did invest in 3a, then as you were only in Zurich for three months you would probably be saving tax unless you are a very high earner.

As Tom says you do not treated favourably for only having worked part of the year. Rather everything is done pro-rata (apart from the 3a - at least in Aargau, which is deducted in full even if you were not here the whole year).
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Old 24.02.2021, 17:30
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Re: Taxation at source -> how to change to a normal taxation

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Did you invest in 3a? If not, and if you live in Zurich city, its probably going to be disadvantageous to submit a tax return given the high geminde tax rate.

If you did invest in 3a, then as you were only in Zurich for three months you would probably be saving tax unless you are a very high earner.

As Tom says you do not treated favourably for only having worked part of the year. Rather everything is done pro-rata (apart from the 3a - at least in Aargau, which is deducted in full even if you were not here the whole year).
Assume I earn 8'000 CHF a month and my Quellensteuer tariff is A0N. Then I pay 14.14% tax each month.

However, I was working in Switerland only 3 months in 2020, so my total gross income would be 24'000 CHF per year which would make the average tax rate just 9.2% for the canton Zurich.

Or did I make some mistake in my calculation?
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Old 24.02.2021, 17:37
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Re: Taxation at source -> how to change to a normal taxation

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Assume I earn 8'000 CHF a month and my Quellensteuer tariff is A0N. Then I pay 14.14% tax each month.

However, I was working in Switerland only 3 months in 2020, so my total gross income would be 24'000 CHF per year which would make the average tax rate just 9.2% for the canton Zurich.

Or did I make some mistake in my calculation?
That does seems like a high % for that salary level. According to https://taxjungle.ch/ch-en you should be paying around 12% for Zurich city if you are single and earn 96K a year (the tax rate depends not only on the kanton but also the geminde if you are filing a tax return).
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Old 24.02.2021, 17:56
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Re: Taxation at source -> how to change to a normal taxation

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However, I was working in Switerland only 3 months in 2020, so my total gross income would be 24'000 CHF per year which would make the average tax rate just 9.2% for the canton Zurich.

Or did I make some mistake in my calculation?
Typical rookie mistake. If you have been a Swiss resident for only part of the year the tax rate determining income is extrapolated to the full year.

If you have been a Swiss resident also for 3 months than the tax rate is correct.
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Old 24.02.2021, 18:24
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Re: Taxation at source -> how to change to a normal taxation

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It will be the same, if not worse.

Tax is calculated on the pro-rated income, i.e. if you work for three months, multiply that by four to get your tax rate.

Tom
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Typical rookie mistake. If you have been a Swiss resident for only part of the year the tax rate determining income is extrapolated to the full year.

If you have been a Swiss resident also for 3 months than the tax rate is correct.

Thanks! Very useful information, and indeed very confusing calculation. I will stay with the Quellensteuer for this year.
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Old 24.02.2021, 19:43
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Re: Taxation at source -> how to change to a normal taxation

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Typical rookie mistake. If you have been a Swiss resident for only part of the year the tax rate determining income is extrapolated to the full year.

If you have been a Swiss resident also for 3 months than the tax rate is correct.
does it make sense to do a tax return for somebody taxed at source where the monthly salary would be volatile due to share options, bonus etc?

as the monthly amounts are taxed according to the tax rates based on extrapolated full year, then any volatility probably leads to distortion.
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Old 24.02.2021, 20:00
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Re: Taxation at source -> how to change to a normal taxation

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Thanks! Very useful information, and indeed very confusing calculation. I will stay with the Quellensteuer for this year.
In general that's a good option if you live in Zurich city! TBH in that scenario I wouldn't be bothering with 3a as although that itself would be tax saving, you would then need to file a tax return, recalculating the tax based on Zurich city rates, which are higher than the cantonal average - which is what quellensteuer is based on. It'd cancel out a lot of the benefit.
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