Money & taxation in Switzerland

Money and taxation will both be essential components of your life in Switzerland, so it's worth getting a good understanding of these topics. Switzerland is well-known for its unusual system of taxation and the proficiency and reputation of its banking system. 

Brief history of taxes in Switzerland

In the past, Switzerland was known as a tax haven due to its company-friendly regime of business taxes. Today, several large reforms of the tax system have meant that these loopholes and exemptions no longer exist. If you are working in Switzerland, are looking for a job, or have just started a business, you will have to pay into the tax system.

Switzerland operates a local system of taxation. This means that the majority of your taxes will go to local authorities rather than a centralised government. Before 1848, the entirety of taxes were administered by local authorities, with each canton giving a small amount to the central government, mainly for maintaining national service. Early taxes were based on goods produced or housing.

After the Sonderbund War of 1848, Switzerland began a long process of making taxation uniform throughout the country. Despite these efforts, the majority of taxes are still determined by local governments, with some cantons such as Zug being famous for offering low business taxes. Although tax loopholes no longer exist, their legacy can be found in each community having different tax rates and different types of tax.

Tax advisors & services

Doing your taxes, especially for expats or business owners, can be challenging. The system necessitates that you declare each stream of income and navigate the series of rebates and exemptions, such as repayments on mortgages. In order to help you through this intricate system of taxation, there are a diverse range of English-speaking tax advisors. They will be able to make your annual tax return easy and will take the pressure off you and your family.

Financial advisors

When you come to a new country as an expat, you face the long and intricate process of moving financial assets from your old country of residence to your new home, and creating a financial plan that keeps pace with the changes in your life. As well as consulting with a tax advisor, you might want to speak with a financial advisor to help you navigate the wealth of financial products and services on offer in Switzerland. An English-speaking financial advisor in Switzerland can help you with things like retirement planning, asset management, and investments. 

Swiss tax system

The Swiss system of taxation is divided between the government, your canton, and your local council (Gemeinde). Each level of government has its own taxes. In order to understand how much these taxes are, where they go, and what is funded through them, you can use our guide to the Swiss tax system. 

Annual tax return in Switzerland

Every year, every household in Switzerland must submit an annual tax return. This is used to calculate how much you need to pay in tax to each government authority. There is a high chance that your tax estimation will be incorrect, meaning that you will receive money back, or alternatively receive requests for further payment over the next few years.

Banking in Switzerland

The Swiss banking system is held in high regard around the world. Swiss banks deliver a high level of service and efficiency for all banking clients. If you plan to make Switzerland your home for the future or wish to store your capital in a competitive investment, you will need a Swiss bank account.

International money transfers to and from Switzerland

At some point, almost all expats in Switzerland will have to transfer money to and from abroad. There are several different methods of transferring funds internationally in Switzerland, and each has its own pros and cons. The best method for you will depend on the amount, type and timing of the transaction.