Swiss Lump-Sum Taxation: The Swiss Golden Visa: In Switzerland, we embrace practicality with a touch of finesse. Forget about the hassle of buying property or making hefty investments to secure your coveted Swiss Golden Visa.
Our approach is refreshingly straightforward: simply grace us with your presence, indulge in the finer aspects of Swiss life. Then commit to an annual tax contribution we mutually agree upon.
It’s like a membership fee to an exclusive club, where the only requirement is to enjoy yourself and contribute to the local economy.
Who said taxes couldn’t be somewhat amusing? Welcome to Switzerland, where your financial contribution is your ticket to one of the most prestigious residencies in the world. There are no strings attached, as long as you bring your wallet and a good sense of humor!
This taxation framework allows individuals to be taxed based on a predetermined amount of annual expenses. You will not be taxed on your global income or wealth. This system presents an attractive proposition for those looking to reside in Switzerland. it is a simplified and potentially advantageous tax structure.
Here’s a concise overview of the cantons that provide the lump-sum taxation option and the general terms associated with it. It’s crucial to note that these details are subject to modifications. consulting the latest information from cantonal tax authorities:
The intricate details, like the exact minimum income requirements and the precise multipliers for rent or rental value, differ widely among cantons. Additionally, certain cantons mandate that the minimum taxable amount must correlate with a multiple of either the rent or rental value of the taxpayer’s dwelling in Switzerland. Other Canton calculate it on a preset of general cost of living. Finally the smartest Cantons chose the biggest of the two previous options.
To be eligible for lump-sum taxation in Switzerland, foreign residents must meet certain criteria. Those criteria are set by the Swiss federal and cantonal governments. Specific requirements can vary slightly from one canton to another. However the core eligibility conditions are generally consistent across Switzerland:
Non-Employment in Switzerland. If you chose lump-sum taxation then you must not engage in any gainful employment in Switzerland. This condition is designed to ensure that the scheme benefits only those whose primary economic activities are outside of Switzerland.
Residency Status: You must obtain residency in Switzerland and must move to Switzerland for the first time or after a significant period of absence. The lump-sum taxation is primarily aimed to attract new residents from abroad.
First-Time Application or Significant Absence: You must live in Switzerland for the first time or return after a significant period of absence (10 years). The scheme is designed to benefits new arrivals.
Annual Agreement: The taxpayer must reach an agreement with the cantonal tax authorities. This agreement is on the amount of annual expenditure that will be subject to taxation. This negotiated amount serves as the basis for calculating the tax due.
Minimum Taxable Amount: There is often a minimum taxable amount set by each canton, which can vary significantly. This amount is based on the cost of living. It can also be based on annual rental multiplied by a specific factor.
Formal Application: You must formally apply for lump-sum taxation upon or shortly after moving to Switzerland. You must file your application in your canton of residency.
No Swiss Citizenship: The option is generally not available to Swiss citizens. It’s designed for foreign nationals moving to Switzerland.
Compliance with International Tax Agreements: You must ensure that the taxation under the lump-sum scheme complies with any applicable international tax agreements of avoidance of double taxation.
Renunciation of Taxation Based on Worldwide Income and Assets: By opting for lump-sum taxation, individuals agree to renounce the standard method of taxation on their worldwide income.
The benefits of this system is that it is a straight and if you can afford it an easy way to obtain Swiss Residency Status.
The drawback is that you cannot make deduction to reduce your taxes.
In the Canton of Geneva such an agreement would cost you from 150,000 CHF to 200,000 CHF per year in taxation.
In the Canton of Vaud such an agreement would cost you from 120,000 CHF to 150,000 CHF per year in taxation.
Those figures are an estimation. We have to negotiate with the administration on a case per case basis.
Also the estimation above are calculated on the lowest acceptable taxable expenses figures. If you have annual taxable expenses of 1,000,000 of course the amount taxable will be higher.
Note that those figures are inclusive of Communal, Cantonal and Federal taxes.
The lump-sum taxation option in Switzerland offers a compelling tax regime for foreign residents.
Its appeal lies in the potential for tax optimization and simplification of tax affairs for those not working in Switzerland.
This option underscores Switzerland’s position as a favorable destination for foreign nationals seeking residency. We can assist you with the matter of Swiss Lump-Sum Taxation: The Swiss Golden Visa. Contact us to get the ball rolling at connect@swissfintechpro.com
