We (family with 1 child) are planning to move out of Kanton Zurich and buy a primary residence in Baselland (close to Basel Stadt). Both our workplaces are now in Basel-Stadt, hence the upcoming move. Some details:
Combined Gross Income: ~ 260k CHF (~ 2:1 ratio), which will put us in a 35-39% marginal tax rate (most BL villages / towns neighbouring BS)
So I put some together some assumptions and wanted to ask all of you if they seem reasonable and any advice you may have:
Optimizing income tax: Even if the March 8 vote passes (individual taxation for married couples), it will be implemented by ~2032. My idea is to use my pillar 2 for downpayment (if at all needed), AND buy regularly (10/20K each year in 2027-2031) in my spouseâs Pillar 2. I read in multiple places that it is still allowed (as these are 2 different pension accounts of 2 people). This will give us a a tax saving till 2031. After, with individual taxation, it only makes sense if the person with higher income buys into pillar 2 - which is currently me. (While Pillar 2 returns may be low, saving 35-39% tax is big enough; given that our pillar 2 is small compared to free assets, I do not mind âleavingâ some money in pillar 2)
Optimizing wealth tax: Real estate and mortgage will reduce our taxable wealth and having them jointly will reduce the effect further with individual taxation.
Optimizing mortgage: Preference to SARON with (a) VIAC (pillar 3a pledge, indirect amortization) or (b) UBS (vitainvest), or (c) any interesting fixed term mortgage at hypotheke.ch . What matters is how different lenders evaluate the property vs the buying price.
My portfolio is full of factor heavy US domiciled ETFs with ~60% in ex-US, resulting in higher dividends than US heavy portfolios. A large mortgage (interest deduction) will reduce DA-1 refund to nearly zero, and with mortgage, I would rather avoid estate taxation scenarios. I see 2 options: (a) Transfer US domiciled ETFs to a joint account and reduce ex-US exposure, or (b) Move to more expensive UCITS equivalents / proxies (I know DFA and Avantis have factor funds in UCITS but they are 70% US, 30% ex-US).
Any thoughts, feedback, opinions, things I have missed completely?
Avoid Baselland? I looked into Dornach (Solothun), but the commute increases and relatively fewer / less interesting apartment / houses.
DFA will soon release a developed ex-US Core fund. Together with ucits AVEM and an US domiciled US fund, youâd optimize your taxes here.
Obviously not as tilted as before, but might be worth to consider.
I would also expect DFA to launch their EM targeted value as an etf soon-ish. Especially now that EM is performing so well, theyâll want to capitalize on that. And they are expanding their offering quite a lot now.
Are you sure that pension fund contributions are not seen together for married couples? Since the returns are filed together , itâs interesting that one person can withdraw and other one can contribute at the same time.
This might also be a chance to review your investment strategy. If you can share what exactly are you trying to achieve with your choice of ETFs, it would be easier to comment.
it seems you are using US ETFs to have an underweight US allocation strategy. Maybe itâs possible to do it using different methods
I started buying it last year with end goal to slowly replace the EM part of VT with this UCITS ETF at another non US broker. I like also the fact that although being focused on income this ETF is still well diversified with nearly 500 stocks (similar to other more generic EM ETFs). Downside of course is the 0.46% TER.
A problem with dividend focused EM etfs are high withholding taxes of em countries. So you have higher hidden tax costs the higher the yield. And then itâs also tax inefficient in CH on top.
In principal going for income focused funds makes sense in EM, as they are less likely to dilute their shares (a huge problem in em markets in general).
But the costs are pretty crazy for us.
A 5% yield at 15% withholding tax, is 0.75% in extra costs. Now tax that left over 4.25% at 30% marginal rate for another 1.28%.
So adding the ter on top, youâll land at effective ~2.5% cost, which is insane.
(Just checked itâs even higher with a 5.6% effective yield, youâll land at something like a whopping 3% ! total cost rate)
Compare that to an CH etf with like a 2.5% yield for example, such as SLICHA.
You have 0.2% TER, 0% wht and at 30% marginal rate 0.75% tax rate cost, comes out to 0.95% effective cost.
Indem du dieses Forum liest und daran teilnimmsch, bestÀtigsch du, dass du d Forum-Richtlinie glese hesch und damit einverstande bisch, sowie mit em Haftungsausschluss, wo uf http://www.mustachianpost.com/de/ prÀsentiert wird.