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Old 24.03.2021, 16:27
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Tax residency/ non-resident

Hi everybody,

I have a little dilemma with tax residency.

I'm a looking to purchase a property in Switzerland. I'm a retiree, EU citizen, non-resident in Switzerland. I'm planning to come to Switzerland as a tourist, and from what I understood it's possible to stay 90/180 days, then re-enter for another 90/180 days, basically 180 days in total per year. The goal is to not become a tax resident in Switzerland.


I have spoked with an accountant which told me that is completely fine.

But today, I also spoke with a tax lawyer which said:

A person is deemed to be resident of Switzerland if he spends more than 90 days (Art. 3(3)b of the Swiss Federal Tax Law). Please keep in mind that immigration rules (including Schengen rules) are fully independent from tax rules. The days (90/180 x 2)will indeed been added up: the counter is not reset when you temporarily leave the national territory. Having this in mind, with the purchase of a property in Switzerland and a regular stay in Switzerland (180 days/year), you will very likely be treated as a tax resident of Switzerland.


But I have found this statement

The individual stays in Switzerland with no intention to exercise gainful activities for a consecutive period (ignoring short absences) of at least 90 days.

Since it mention the consecutive period, with a long absence 90/180, the counter should be reset.

Please help me figure out. Thank you
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Old 24.03.2021, 16:47
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Re: Tax residency/ non-resident

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Please keep in mind that immigration rules (including Schengen rules) are fully independent from tax rules.
This is what I wrote near the beginning of your other post on the same subject.
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Old 24.03.2021, 16:56
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Re: Tax residency/ non-resident

And here was the initial thread: https://www.englishforum.ch/permits-...residents.html
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Old 24.03.2021, 17:23
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Re: Tax residency/ non-resident

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I am subject to worldwide taxation in the US and Switzerland (citizen and tax resident of both) and in the UK as well. I think each country deems me domiciled in itself. (My problem is that unless I am registered as resident in a Swiss commune, my bank won't renew my mortgage. They hate Americans, as you must know. But as the value of the house has diminished substantially in the 15 years I owned it, and it's an interest-only mortgage, I'm under water. That, as I've told Credit Suisse, is their problem. I implied I might file Chapter 11. As of now they are silent, no renewal but I assume they will collect the March interest next week. With Greensill they have more serious problems than mine that need attention.

The US-UK tax treaty exempts from tax government (not Social Security, State Pension) pensions received by a non-citizen. So does the US-CH one, but that doesn't help me.

I have demanded Competent Authority resolution of the possible double taxation of my US pension. The US Tax Court case of Filler v. Commissioner, 74 TC 406, easily found online, stands for the right of the IRS to tax US-source income first, regardless of what the foreign government (in that case France) may say. The judge told the taxpayer to go demand Competent Authority. Which doesn't always resolve double taxation risk but is supposed to.

I think it will be years before my Swiss tax returns for 2019 and 2020 are resolved. There is a 10-year limitation period for correcting an IRS Form 1116 after a foreign tax authority revises its assessment, but that won't help me.
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Old 24.03.2021, 18:08
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Re: Tax residency/ non-resident

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When I have opened the first one it was for understanding the maximum length of stay for a tourist, but now I have doubts about tax residency.

I'm still pretty sure that 90 days of absence should reset the count of days of previous stay
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Old 24.03.2021, 19:04
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Re: Tax residency/ non-resident

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When I have opened the first one it was for understanding the maximum length of stay for a tourist, but now I have doubts about tax residency.

I'm still pretty sure that 90 days of absence should reset the count of days of previous stay

The 90-day rule for tax residence applies to "a more-or-less contiguous" period with a day counted as an overnight stay. This seems to be open to interpretation but yes I strongly suspect that a 90 day break between stays would be sufficient to break the periods of stay. In combination with retaining a tourist status I don't think you'd have anything to worry about.

For example if you stay for a period of 95 days but 6 of those days you were out of the country that would be considered one period of stay and the number of days would be 89.
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Old 24.03.2021, 21:10
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Re: Tax residency/ non-resident

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The 90-day rule for tax residence applies to "a more-or-less contiguous" period with a day counted as an overnight stay. This seems to be open to interpretation but yes I strongly suspect that a 90 day break between stays would be sufficient to break the periods of stay. In combination with retaining a tourist status I don't think you'd have anything to worry about.

For example if you stay for a period of 95 days but 6 of those days you were out of the country that would be considered one period of stay and the number of days would be 89.
Thanks, Landers, for the response. Well, as you also mentioned, 90 days break should be enough to break the periods of stay. I hope that we both are right.
The example of 95 days with 6 days out, I think fall in the category of short absences, which are ignored, and therefore I would exceed the 90 days. Buy fortunately it's not my case anyways
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Old 24.03.2021, 21:34
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Re: Tax residency/ non-resident

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Thanks, Landers, for the response. Well, as you also mentioned, 90 days break should be enough to break the periods of stay. I hope that we both are right.
The example of 95 days with 6 days out, I think fall in the category of short absences, which are ignored, and therefore I would exceed the 90 days. Buy fortunately it's not my case anyways
Ignored for counting the number of days and also don't constitute a break in the overall period.
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