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Old 27.10.2010, 15:21
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Wealth Tax in Switzerland - seeking clarification, information

I just learned that , when working in Switzerland, I have to pay a "wealth tax" annually, to the tune of about 1%, on all our worldwide assets, regardless of the fact that the asset is located outside Switzerland and was earned before we stepped on to Swiss soil. This was a shock for us. I woudl appreciate any advice/information about this particular tax form.

In particular, in the last job I worked for, we did nto have a pension system. Instead, the company gave us shares of company stock, that we will use to create our income stream during retirement. The stocks are in my name, held in a company account meant for holding such retirement assets. Would the market value of these stocks be considered as "assets" for teh purpose fo calculating "wealth tax" in Switzerland ? This bugs me, since, if my previous employer had a traditional pension plan, then the company would have set aside assets on my behalf, that would be used to generate the income needed for the company to pay me a monthly pension after retirement. But that asset would not be visible in my name adn thus not count towards wealth tax calculations in Switzerland.

Please help !
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Old 27.10.2010, 18:40
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Re: Wealth Tax in Switzerland - seekign clarification, information

You can google this, look in your cantonal website or search these forums. It is NOT 1%, starts (in Kt Zurich) at 0.5 per 1000 (NOT 100) on assest over approx CHF143,000...
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Old 27.10.2010, 18:42
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Re: Wealth Tax in Switzerland - seekign clarification, information

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You can google this, look in your cantonal website or search these forums. It is NOT 1%, starts (in Kt Zurich) at 0.5 per 1000 (NOT 100) on assest over approx CHF143,000...
In short: You do not really need to worry.
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Old 27.10.2010, 18:52
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Re: Wealth Tax in Switzerland - seekign clarification, information

Do be aware, though, that should the upcoming tax referendum pass the cantonal/communal rate will be set at a minimum of 5 promille for wealth over 2mio.

Last edited by meloncollie; 27.10.2010 at 18:55. Reason: correction
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Old 28.10.2010, 00:16
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Re: Wealth Tax in Switzerland - seekign clarification, information

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The stocks are in my name, held in a company account meant for holding such retirement assets. Would the market value of these stocks be considered as "assets" for teh purpose fo calculating "wealth tax" in Switzerland ?
There are special rules on the taxation (income and wealth tax) of bound employee shares (gebundene Mitarbeiteraktien). But to be on the safe side, this is really something to take up with a tax consultant. PM for a contact or ask around on the forum.
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Old 29.10.2010, 04:31
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Re: Wealth Tax in Switzerland - seekign clarification, information

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You can google this, look in your cantonal website or search these forums. It is NOT 1%, starts (in Kt Zurich) at 0.5 per 1000 (NOT 100) on assest over approx CHF143,000...
I am still very confused. So let me state my question a little differently.

What is the definition of "Wealth" in Switzerland, for purposes of calculating wealth tax ?

What items of value are counted towards calculating "wealth" and what are not ? Home, car, stocks, bonds, pension funds, IRAs , jewelry, savings accounts, furniture , 401K balances, life insurance cash values , etc etc ...... I am hearing that a home, located outside Switzerland, is not actually taxed, but its value counts towards figuring out value of total wealth and thus, tax rate. What about savings accounts held in US banks ? College Funds for kids in 529 accounts ? IRAs in US banks ? Stocks purchased before moving to Swtizerland ? Any help will be greatly appreciated. I am only seeking information that any of you may have from your actual experience..... I knwo I have to go to a tax consultant in teh end to ensure details are correct. Thanks so much for all your help so far.
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Old 29.10.2010, 08:25
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Re: Wealth Tax in Switzerland - seekign clarification, information

Nearly all your assets outside Switzerland will be included in the calculation of wealth tax, including those held in tax-efficient wrappers (like the 529 college plan). Typically you need to declare any liquid assets, your house, and your cars. Jewellery isn't declared, to my knowledge.

I haven't heard about any exemption for a house in a foreign country -- as far as I know, the house is considered when calculating wealth. You can, of course, deduct the value of any mortgage you have on the house, so you're only paying on the equity in the house.

Unless you're fantastically wealthy, I wouldn't worry too much about the wealth tax. In my case (with a "reasonable" amount of wealth and a salary above the US Foreign Earned Income Exemption level), my Swiss tax liability was lower than my US tax liability, eg, I ended up owing US taxes in addition to my Swiss taxes. So regardless of the wealth tax, my overall tax burden was the same. The only difference the wealth tax made was the size of the cheque I wrote to the Swiss vs. US tax authorities.
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Old 28.11.2010, 10:54
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Re: Wealth Tax in Switzerland - seekign clarification, information

Does anybody here know the answer to this:

If a Swiss citizen moves out of Switzerland, do they have to file tax return here? Do they pay wealth tax here if they're not living here just because they have a Swiss passport?

Thanks.
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Old 30.11.2010, 00:45
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Re: Wealth Tax in Switzerland - seekign clarification, information

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Does anybody here know the answer to this:

If a Swiss citizen moves out of Switzerland, do they have to file tax return here? Do they pay wealth tax here if they're not living here just because they have a Swiss passport?

Thanks.
No they don't.
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Old 30.11.2010, 00:50
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Re: Wealth Tax in Switzerland - seekign clarification, information

Is there a limit to how long a Swiss person can live in Switzerland before they have to file a tax return and pay wealth tax (assume no income). You know what I mean? Assume a Swiss person lives in Africa. They come to Switzerland for visit. If they stay here 2 months or 4 months ... at some point they get eligible to pay wealth tax. What is that point?
Cheers/
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Old 30.11.2010, 01:09
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Re: Wealth Tax in Switzerland - seekign clarification, information

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I haven't heard about any exemption for a house in a foreign country -- as far as I know, the house is considered when calculating wealth. You can, of course, deduct the value of any mortgage you have on the house, so you're only paying on the equity in the house.
Correct: Properties outside CH are counted as assets (but at a reduced rate if it is for own use, ours comes in with about half of market value), and you can deduct mortgage liability and interest payments as well as maintenance costs.
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Old 30.11.2010, 09:17
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Re: Wealth Tax in Switzerland - seekign clarification, information

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Is there a limit to how long a Swiss person can live in Switzerland before they have to file a tax return and pay wealth tax (assume no income). You know what I mean? Assume a Swiss person lives in Africa. They come to Switzerland for visit. If they stay here 2 months or 4 months ... at some point they get eligible to pay wealth tax. What is that point?
Cheers/
Not until they register with their local community - obligatory within 8 days or moving permanently to that community. As a tourist non-Swiss can remain in the country for 3 months.

Theoretically a Swiss could live here longer in various hotels and never be sent a tax form...
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Old 30.11.2010, 10:57
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Re: Wealth Tax in Switzerland - seekign clarification, information

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Do be aware, though, that should the upcoming tax referendum pass the cantonal/communal rate will be set at a minimum of 5 promille for wealth over 2mio.
Thankfully it didn't happen. Good luck in low tax Kt. SZ
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Old 30.11.2010, 11:08
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Re: Wealth Tax in Switzerland - seekign clarification, information

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Not until they register with their local community - obligatory within 8 days or moving permanently to that community. As a tourist non-Swiss can remain in the country for 3 months.

Theoretically a Swiss could live here longer in various hotels and never be sent a tax form...
Technically anyone here whether Swiss or not for more than 90 days needs to register and have health insurance, even if living in a Hotel.
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Old 12.06.2012, 16:06
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Re: Wealth Tax in Switzerland - seekign clarification, information

Bumping this old thread...

We are moving to Zurich and will be renting our UK house. I have googled wealth tax and its says that...

"The wealth taxes in the canton of Zürich is are based on a progressive rate and varies from 0.05% to max 0.66% of the taxable net wealth."

Does this mean it is a tax on the rental income only that we receive from the property?

Thank you so much everyone.
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Old 12.06.2012, 16:10
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Re: Wealth Tax in Switzerland - seekign clarification, information

only if you tell them
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Old 12.06.2012, 16:12
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Re: Wealth Tax in Switzerland - seekign clarification, information

No it is a tax on your wealth, ie your total assets, NOT on your income. However, the amounts are generally minimal as the tax rate is low.
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Old 12.06.2012, 16:24
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Re: Wealth Tax in Switzerland - seekign clarification, information

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No it is a tax on your wealth, ie your total assets, NOT on your income. However, the amounts are generally minimal as the tax rate is low.

Thanks for your replies, really appreciate it! Out of interest, how do they determine how much my house is worth?
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Old 12.06.2012, 16:27
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Re: Wealth Tax in Switzerland - seekign clarification, information

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Out of interest, how do they determine how much my house is worth?
For me (in Geneva so different cantonal tax authority) I simply told them what I thought it was worth. They didn't question it, but I'm sure they could if they wanted to. Given the amount will likely be small (unless you are talking about a multi-million pound mansion) I would be honest about it
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Old 12.06.2012, 16:33
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Re: Wealth Tax in Switzerland - seekign clarification, information

Thank you!! Unfortunately it isn't a multi million pound mansion. But we might win the lottery this weekend!!!
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