I tried to estimate the impact of Proposal in comment below.
For a withdrawal of 1.5 MM capital -: Additional federal tax ranges from 6.5 K to 120 K depending on “Other personal annual income” at time of withdrawal.
Are your tables correct. Do you calculate the effective tax rate on the additional income. I tried a couple of numbers and didn’t match what you calculated. Maybe you calculated an overall tax rate for income + additional capital withdrawal tax?
Actually I tallied my numbers with the calculator that was shared by newspaper
These numbers should be correct assuming fictitious income (based withdrawal amount) is used in combination with Other income to establish the tax rate for capital withdrawals
Capital withdrawal tax rate = function (withdrawal amount, other annual income)
As far as I understand -: the whole proposal is only for lumpsum tax. There is no proposal to change the federal tax for annual income . It would even increase further the impact
So this amount should be see as „extra“ tax burden for lumpsum withdrawals only.
Could you share what error you see?
So does the difference calculated represent:
(income + virtual income) @ federal tax rate
minus
(income @ fed tax rate + capital withdrawal taxes)
No
It just represents
Federal taxes for withdrawal with new rules
Minus
Federal taxes for withdrawal with old rules
I haven’t studied the list above, but according to my understanding and formula based tax calculator:
Today: 1.5m withdrawal is 34.493 federal tax, 2.3% (double check: roughly 12% / 5)
Proposal, no additional progression: 1.5m would become 75k of fictional income
- 75k income is 798 in tax, or 1.1% on average
- 1.5m * 1.1% = 15.960. Less than half, if there’s no min. level
Proposal, with additional progression (50k other taxable income):
- 125k income is 3.315 in tax, or 2.7%
- 1.5m * 2.7% = 39.780. 15% more
Note: based on married table 2024
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But if you have 50k of other income, that would be taxed anyway, right? So then we need to deduct the tax on the 50k to do a fair comparison to the other scenarios.
Here is the official calculator
https://gox.ch/steuerrechner.html
Note -: this only goes to 1 Million withdrawals
The tax of income is not going to change
So there is nothing to deduct
Let’s take an example
Case 1 -: today
1.5 M capital withdrawal and 100K annual income
Tax -: C1 for capital withdrawn
Tax -: P1 for income tax on 100K
Case 2 -: proposed
1.5 M capital withdrawal and 100K annual income
Tax -: C2 for capital withdrawn
Tax -: P1 for income tax on 100K
Only C2 is changing to a higher number vs C1
Rest is unchanged
In this example C2 is approx 51K more than C1
But in #1 above, there is no tax on income included. In #2, there is no tax in income included. In #3 there is tax on income included. So #3 cannot be fairly compared to #1 and #2 without adjustment.
Yes, I was just trying to understand whether people are really comparing C1 to C2, or are they comparing C1 to (C2+P1) by looking at tax on the full 125k.
I am only comparing C1 and C2
This would change depending on Single / married / kids etc
The table I shared was for single person / no kids
In your 2nd table, the tax doesn’t increase with income, so you are only calculating tax on the capital withdrawal and ignore tax on income.
In the first table, on a withdrawal of 1.5m, you have 75k of income and assuming 150k of income, you calculate a tax rate of 7.3% (actually 7.28% without rounding). But this is tax on 225k of income!
This is actually 16k of tax on 225k of income+capital.
But this includes income tax on 150k of 7k (which you didn’t include in the 2nd table). So the tax attributable to the capital withdrawal is actually 16k-7k = 9k. So the effective tax rate on the capital is actually 12.2%, not 7.3% as you stated.
You are not comparing like with like. If you want to compare like with like, you either need to add income tax to table 2, or remove income tax on table 1.
In second table tax is not increasing with income because in current tax approach, the capital tax doesn’t increase with income
Irrespective of annual income, the lumpsum tax is same . Isn’t it?
yes, but then you are comparing (tax on capital) with (tax on capital + tax on income)
No this is just tax rate calculation. The actual tax on capital as per new rule is following
Tax (C2) = capital withdrawn x Tax rate
Where
Tax rate = function (taxable income, capital withdrawn)
I would recommend you use the official calculator and use it for 990,000 withdrawal . You will see the number in official calculations match exactly my table
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ah. ok. i think i see what you mean. i will try again.
EDIT:
It seems that under their proposed calculation methodology, the tax will be very sensitive to taxable income in the year.
Without additional tax planning, I calculated that I will pay an extra 200k+ in tax with this rule change. Ouch!
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Who created this calculator? There is no imprint.
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It would be. That’s the whole discussion point, or reason for outrage after many posts, isn’t it?
The calculation under this link seems valid, now I wonder why my Excel has slightly different results 
Don’t want to end up like @PhilMongoose and overpay to pillar 2 
I wouldn’t call it official, though. It’s just something, somebody put online based on their understanding and calculation.
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Based on the design and source code, I suspect that the calculator is from Tagesanzeiger.