Go Back   English Forum Switzerland > Help & tips > Finance/banking/taxation  
Reply
 
Thread Tools Display Modes
  #1  
Old 07.06.2010, 12:45
Newbie
 
Join Date: Jun 2010
Location: Gryon Vd
Posts: 3
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
davidhenry has no particular reputation at present
Swiss Tax on UK pension lump sum

Hi, This is my first post and I have searched other threads to try to find this info so apologies if it is dealt with elsewhere.

I am Swiss resident with a C permit and looking forward to being able to draw on my UK pension fund (SIPP) within the next few years. I understand that pension drawdown will be taxed as income here in CH but can anyone tell me how the 25% lump sum that can be drawn tax free in the UK will be treated here for tax purposes? Is it tax free, taxed similarly to pillar 2 or 3 drawdown, or taxed as straight income in the year received?

Again my apologies if this is dealt with elsewhere.

Thanks

David
Reply With Quote
  #2  
Old 07.06.2010, 13:09
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,331
Groaned at 353 Times in 241 Posts
Thanked 12,263 Times in 4,202 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Swiss Tax on UK pension lump sum

You need to google and look into QROPS. This allows you to transfer your UK private pension tax free out of the UK, to a UK government approved scheme offshore or in Switzerland.

Beware of the QROPS salesmen who make fat commissions on these schemes. I suggest asking you UK bank for info...
Reply With Quote
  #3  
Old 07.06.2010, 14:53
Newbie
 
Join Date: Jun 2010
Location: Gryon Vd
Posts: 3
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
davidhenry has no particular reputation at present
Re: Swiss Tax on UK pension lump sum

Thanks but a QROPS is not what I have in mind. I have looked through those threads. Its just the straightforward question of Swiss tax treatment of the 25% lump sum that can be taken tax free in the UK when starting to draw from my personal pension there.

I would hate to do this and then find that the Swiss tax it!
Reply With Quote
  #4  
Old 07.06.2010, 21:32
Goldtop's Avatar
Forum Legend
 
Join Date: Feb 2008
Location: Zurich
Posts: 2,844
Groaned at 11 Times in 11 Posts
Thanked 905 Times in 625 Posts
Goldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond reputeGoldtop has a reputation beyond repute
Re: Swiss Tax on UK pension lump sum

Quote:
View Post
Thanks but a QROPS is not what I have in mind. I have looked through those threads. Its just the straightforward question of Swiss tax treatment of the 25% lump sum that can be taken tax free in the UK when starting to draw from my personal pension there.

I would hate to do this and then find that the Swiss tax it!
I have no direct experience of this. My guess is that the Swiss will tax it but at the special rates applicable for liquidation Swiss pension or 3a capital.

You should ask the Swiss tax office in your jurisdiction. In ZH, you can get a quick and binding reply to such questions.
Reply With Quote
  #5  
Old 08.06.2010, 00:08
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,331
Groaned at 353 Times in 241 Posts
Thanked 12,263 Times in 4,202 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Swiss Tax on UK pension lump sum

You may be asked for back wealth tax if it has not been previously declared...
Reply With Quote
  #6  
Old 08.06.2010, 00:51
economisto
 
Posts: n/a
Re: Swiss Tax on UK pension lump sum

Actually a QROPS is irrelevant to this question anyway, since you can take 25% lump from a QROPS or without it. You do not have to declare an uncrystallised pension as part of your wealth for Swiss wealth tax since it's in fact not your asset.

Last edited by economisto; 08.06.2010 at 09:35.
Reply With Quote
  #7  
Old 08.06.2010, 09:23
Forum Legend
 
Join Date: Oct 2009
Location: la cote
Posts: 3,490
Groaned at 21 Times in 13 Posts
Thanked 3,122 Times in 1,645 Posts
runningdeer has a reputation beyond reputerunningdeer has a reputation beyond reputerunningdeer has a reputation beyond reputerunningdeer has a reputation beyond reputerunningdeer has a reputation beyond repute
Re: Swiss Tax on UK pension lump sum

I believe Article 18 of the bilateral Swiss-UK double taxation treaty covers this:

"1. Subject to the provisions of paragraph 2 of Article 19, pensions and other similar remuneration paid to an individual who is a resident of a Contracting State, shall be taxable only in that State.
2. Notwithstanding the provisions of paragraph 1, a lump sum payment derived from a pension scheme established in a Contracting State and beneficially owned by a resident of the other Contracting State shall be taxable only in the first-mentioned State. "

Not sure if this would be updated/amended with all the other tax accords the Swiss are now in the process of updating due to the recent pressure on the Swiss re. UBS and others.
Reply With Quote
  #8  
Old 09.06.2010, 07:33
Newbie
 
Join Date: Jun 2010
Location: Gryon Vd
Posts: 3
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
davidhenry has no particular reputation at present
Re: Swiss Tax on UK pension lump sum

Thank you running deer that is most helpful.
Reply With Quote
  #9  
Old 16.03.2021, 06:40
Junior Member
 
Join Date: Jun 2020
Location: Zurich
Posts: 66
Groaned at 1 Time in 1 Post
Thanked 81 Times in 29 Posts
HilR has an excellent reputationHilR has an excellent reputationHilR has an excellent reputationHilR has an excellent reputation
Re: Swiss Tax on UK pension lump sum

This thread was last updated in 2010. Since then there have been UK-CH treaty changes. Does anyone know the latest position? Thanks
Reply With Quote
  #10  
Old 16.03.2021, 10:46
H in CH's Avatar
Junior Member
 
Join Date: Dec 2009
Location: Zürich
Posts: 65
Groaned at 0 Times in 0 Posts
Thanked 30 Times in 15 Posts
H in CH is considered knowledgeableH in CH is considered knowledgeableH in CH is considered knowledgeable
Re: Swiss Tax on UK pension lump sum

Latest position = same as stated by runningdeer i.e. no change.

https://www.gov.uk/government/public...eaties#history
(Article 18)

1977 UK/Switzerland Double Taxation Convention as amended by the 1981, 1993, 2007, 2009 and the 2017 Protocols The 2017 Protocol entered into force on 16 July 2019
Reply With Quote
The following 2 users would like to thank H in CH for this useful post:
Reply




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
US tax on Swiss pension savings? Goldtop Finance/banking/taxation 17 23.12.2012 21:44
Lump-sum taxation ("forfait tax") of resident aliens Felix Finance/banking/taxation 100 12.07.2011 14:27
3a Pension change - USA - Swiss tax agreement SWISSMISS143 Finance/banking/taxation 4 25.09.2009 11:24
tax implications for bringing into Switzerland a lump sum lankylewis Finance/banking/taxation 14 22.06.2008 21:52
Tax on UK State Pension Phoebe Finance/banking/taxation 8 23.01.2008 12:50


All times are GMT +2. The time now is 11:30.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0