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Old 10.01.2014, 14:25
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Unpaid swiss taxes when returned to UK

Hi
I worked in Zurich for 2011(full year) and 2012(first 6 months) and returned back to UK then. I was employed by an agency called Randstad to work for a bank in Zurich and they used to deduct my taxes(its called Withholding tax) every month and pay me a monthly salary. When I left Switzerland, I de-registered from the local council office and informed Tax office that I am returning now. They took into consideration that I had paid my taxes through the agency. Also before I left, I hired an accountant and filed my tax returns for 2011 and 2012 too and he confirmed that no further amounts are outstanding. Now, Zurich tax office has sent me a 13k GBP bill after 1.5 years that this is the tax which is overdue for 2011 and about 4k GBP for 2012 as they say that I paid less but how could I pay less if my company was deducting tax every month and even my accountant didnt said of any underpayment from my side.

My question now is that now if I ignore their bill of 13k GBP for 2011 and don’t pay (I give myself an annual salary now of 15k GBP only from my uk registered LTD company), can the Swiss Tax Office forcefully take this money from me whilst I am in UK? I dont have any plans to go back to Switzerland even as a tourist. Do they have the rights to come to Uk and get this money from me? Also, can they ask HMRC for this money and HMRC forcefully takes this from me to pay to them etc under the double taxation treaty?

The only treaty I am aware between Swiss and UK Govt is related to offshore bank accounts where if I hold a Swiss Bank account, Swiss authorities will have to inform HMRC about my offshore bank account… However, I am not aware of any such treaty where Swiss Govt can take unpaid tax from swiss earned income forcefully directly from me in UK or via HMRC
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Old 10.01.2014, 14:32
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Re: Unpaid swiss taxes when returned to UK

If you were deducted at source and you have an accountant confirming this (how? tax returns?) then first stop for me would be the accountant.
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Old 10.01.2014, 14:34
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Re: Unpaid swiss taxes when returned to UK

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Hi
I worked in Zurich for 2011(full year) and 2012(first 6 months) and returned back to UK then. I was employed by an agency called Randstad to work for a bank in Zurich and they used to deduct my taxes(its called Withholding tax) every month and pay me a monthly salary. When I left Switzerland, I de-registered from the local council office and informed Tax office that I am returning now. They took into consideration that I had paid my taxes through the agency. Also before I left, I hired an accountant and filed my tax returns for 2011 and 2012 too and he confirmed that no further amounts are outstanding. Now, Zurich tax office has sent me a 13k GBP bill after 1.5 years that this is the tax which is overdue for 2011 and about 4k GBP for 2012 as they say that I paid less but how could I pay less if my company was deducting tax every month and even my accountant didnt said of any underpayment from my side.

My question now is that now if I ignore their bill of 13k GBP for 2011 and don’t pay (I give myself an annual salary now of 15k GBP only from my uk registered LTD company), can the Swiss Tax Office forcefully take this money from me whilst I am in UK? I dont have any plans to go back to Switzerland even as a tourist. Do they have the rights to come to Uk and get this money from me? Also, can they ask HMRC for this money and HMRC forcefully takes this from me to pay to them etc under the double taxation treaty?

The only treaty I am aware between Swiss and UK Govt is related to offshore bank accounts where if I hold a Swiss Bank account, Swiss authorities will have to inform HMRC about my offshore bank account… However, I am not aware of any such treaty where Swiss Govt can take unpaid tax from swiss earned income forcefully directly from me in UK or via HMRC

Are you sure the agency that deducted your taxes did hand over the money to the Swiss Govt?
To have an excess tax bill of 13K GBP you would need to be earning (my guess) around 400K CHF per year?
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Old 10.01.2014, 14:37
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Re: Unpaid swiss taxes when returned to UK

Withholding tax is based on averages and a guesstimate of your real earnings, and depending on the amount you actually earned it is possible that you underpaid. I was in exactly the same boat 6-7 years ago and had to pay more, it is quite common to have to pay extra tax a few years later when they work out the real figures.

However I would go to the accountant because the 13K GBP seems way too high.
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Old 10.01.2014, 14:42
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Re: Unpaid swiss taxes when returned to UK

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Hi
I worked in Zurich for 2011(full year) and 2012(first 6 months) and returned back to UK then. I was employed by an agency called Randstad to work for a bank in Zurich and they used to deduct my taxes(its called Withholding tax) every month and pay me a monthly salary. When I left Switzerland, I de-registered from the local council office and informed Tax office that I am returning now. They took into consideration that I had paid my taxes through the agency. Also before I left, I hired an accountant and filed my tax returns for 2011 and 2012 too and he confirmed that no further amounts are outstanding. Now, Zurich tax office has sent me a 13k GBP bill after 1.5 years that this is the tax which is overdue for 2011 and about 4k GBP for 2012 as they say that I paid less but how could I pay less if my company was deducting tax every month and even my accountant didnt said of any underpayment from my side.

My question now is that now if I ignore their bill of 13k GBP for 2011 and don’t pay (I give myself an annual salary now of 15k GBP only from my uk registered LTD company), can the Swiss Tax Office forcefully take this money from me whilst I am in UK? I dont have any plans to go back to Switzerland even as a tourist. Do they have the rights to come to Uk and get this money from me? Also, can they ask HMRC for this money and HMRC forcefully takes this from me to pay to them etc under the double taxation treaty?

The only treaty I am aware between Swiss and UK Govt is related to offshore bank accounts where if I hold a Swiss Bank account, Swiss authorities will have to inform HMRC about my offshore bank account… However, I am not aware of any such treaty where Swiss Govt can take unpaid tax from swiss earned income forcefully directly from me in UK or via HMRC
ignoring the bill won't make it go away. you normally have a period of time to contest it, so unless you want the 13k bill to stand - and sooner or later you probably will end up paying (see the various stories on here) with interest and penalties on top - you probably want to fix this now.
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Old 10.01.2014, 17:09
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Re: Unpaid swiss income taxes when returned to UK

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Hi
I worked in Zurich for 2011(full year) and 2012(first 6 months) and returned back to UK then. I was employed by an agency called Randstad to work for a bank in Zurich and they used to deduct my taxes(its called Withholding tax) every month and pay me a monthly salary. When I left Switzerland, I de-registered from the local council office and informed Tax office that I am returning now. They took into consideration that I had paid my taxes through the agency. Also before I left, I hired an accountant and filed my tax returns for 2011 and 2012 too. Now, Zurich tax office has sent me a 13k GBP bill after 1.5 years that this is the tax which is overdue for 2011 and about 4k GBP for 2012 as they say that I paid less but how could I pay less if my company was deducting tax every month and even my accountant didnt said of any underpayment from my side.

My question now is that now if I ignore their bill of 13k GBP for 2011 and don’t pay (I give myself an annual salary now of 15k GBP only from my uk registered LTD company), can the Swiss Tax Office forcefully take this money from me whilst I am in UK? I dont have any plans to go back to Switzerland even as a tourist. Do they have the rights to come to Uk and get this money from me? Also, can they ask HMRC for this money and HMRC forcefully takes this from me to pay to them etc under the double taxation treaty?

The only treaty I am aware between Swiss and UK Govt is related to offshore bank accounts where if I hold a Swiss Bank account, Swiss authorities will have to inform HMRC about my offshore bank account… However, I am not aware of any such treaty where Swiss Govt can take unpaid tax from swiss earned income forcefully directly from me in UK or via HMRC
They can take you to court in the UK & bankrupt you if you can't pay.
The UK revenue will not get involved.
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Old 10.01.2014, 18:41
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Re: Unpaid swiss income taxes when returned to UK

If you were earning an equivalent annual salary of over CHF 120,000, then the tax with-held from your payslip is just a down-payment.

The correct tax is then calculated based on tax returns (which you did) and can be much higher, as you saw. So it's both the norn, and probably correct.
The fact that they contacted you after 1.5 years is also the norm, even for people who continue to live in Switzerland.

Did you speak to the Swiss accountant you used ?? I find it hard to believe that he didn't warn you (i) that you had to pay more tax and (ii) that the bill will arrive 1-2 years later.

No, they cannot arrest you or ask HMRC for this as far as I know (though, the UK and CH signed a new tax cooperation treaty this year, I'm not sure how this affects things). But the sum is not too small for them to ignore.


They can (and will im afraid) very easily hire a UK lawyer and take the case to a UK court to ask for the money, in effect, the same way as if you owned £13k to BT (say).
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Old 10.01.2014, 20:17
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Re: Unpaid swiss income taxes when returned to UK

Taxes (and fines) are exempt from EEO, Brussels and Lugano debt enforcement/recovery orders/agreements.
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Old 10.01.2014, 20:35
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Re: Unpaid swiss income taxes when returned to UK

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Taxes (and fines) are exempt from EEO, Brussels and Lugano debt enforcement/recovery orders/agreements.
Not if they get a judgement from UK court, if I remember correctly...
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Old 10.01.2014, 21:01
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Re: Unpaid swiss income taxes when returned to UK

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Not if they get a judgement from UK court, if I remember correctly...
Historically, UK courts will not enforce judgements for foreign taxes.
A Swiss entity with a Swiss Judgement cannot get a UK judgement for the same matter.

However the UK’s adoption of Article 27 of the OECD Model Tax Convention (Article 27) might apply because there is an effective double taxation agreement in place. This is being used more and more since 2010, but not for small fish.
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Old 10.01.2014, 21:08
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Re: Unpaid swiss income taxes when returned to UK

They can sell the debt to a UK collection company...
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Old 10.01.2014, 21:30
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Re: Unpaid swiss income taxes when returned to UK

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They can sell the debt to a UK collection company...
Which are toothless and you can tell them to piss off with impunity. Debt collectors are not bailiffs or sheriffs.
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Old 10.01.2014, 21:30
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Re: Unpaid swiss income taxes when returned to UK

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They can sell the debt to a UK collection company...
They/The DCA wont be able to take the matter to court though...
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Old 06.07.2016, 20:48
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Re: Unpaid swiss taxes when returned to UK

I also received a tax demand @CHF 15K for 2014 and 2015 after I moved back my country 'India'. After contacting, tax authority told me that appeal period (30 days) is over. The tax has calculated based on estimates. Seems, they rejected numbers from my returns for 2014 and 2015.

@verma007: How did you solve it?

@others: Do I have any other option to challenge it?
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Old 06.07.2016, 20:56
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Re: Unpaid swiss taxes when returned to UK

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I also received a tax demand @CHF 15K for 2014 and 2015 after I moved back my country 'India'. After contacting, tax authority told me that appeal period (30 days) is over. The tax has calculated based on estimates. Seems, they rejected numbers from my returns for 2014 and 2015.

@verma007: How did you solve it?

@others: Do I have any other option to challenge it?
No as the appeal period is over.
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Old 06.07.2016, 20:59
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Re: Unpaid swiss taxes when returned to UK

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No as the appeal period is over.
The appeal period is ridiculous in Switzerland. They should make it symmetrical so that when you file your tax return, they have 30 days to contest it else it becomes final!
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Old 06.07.2016, 21:22
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Re: Unpaid swiss taxes when returned to UK

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I also received a tax demand @CHF 15K for 2014 and 2015 after I moved back my country 'India'. After contacting, tax authority told me that appeal period (30 days) is over. The tax has calculated based on estimates. Seems, they rejected numbers from my returns for 2014 and 2015.

@verma007: How did you solve it?

@others: Do I have any other option to challenge it?
verma007 does not appear to have been back to this forum since the day in 10.1.2014 he posted the message. You could try sending him an email through his contact information.
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Old 06.07.2016, 21:43
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Re: Unpaid swiss taxes when returned to UK

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I dont have any plans to go back to Switzerland even as a tourist.
Never say never....
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