Also if you do end up being classified there’s a lot of tax optimization to do around tax loss harvesting (which is also one reason why they are not eager to classify people 
)
Thank you for the welcome, and for giving me hope. I really appreciate it.
Would your estimation still be the same if I add these additional details?
- I sold my entire portfolio on one day in 2024 (because I thought I’d leave Switzerland, which didn’t happen). I since repurchased 75% of it.
- Far more than 50% of my portfolio were gains, a larger 6-digit amount. The taxes on those would be in the 6-digit amount as well, which is why I am so worried.
- I had less than 10 transaction in the entire 2024
- The portfolio are only mainstream public stocks and I have zero financial background (I work in IT)
- I might extend my sabbatical for a few more years, if that does not put me at further tax risk…
Currently I am paying a tax consultant who tells me that the canton of Vaud is difficult to talk to for a situation like mine and that I would need to hire them for more research on the topic to provide me with certainty. I have a bad gut feeling about that being a money drain, which is why I ended up here.
Again, thank you so much.
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Yes, nothing here shows professional behavior.
You can check https://www.estv.admin.ch/dam/estv/fr/dokumente/dbst/kreisschreiben/dbst-ks-2012-1-036-d-fr.pdf.download.pdf/dbst-ks-2012-1-036-d-fr.pdf yourself for how they decide (in particular the details in “4. Activité lucrative indépendante portant sur des titres (commerce professionnel de titres)”.
It’s about the intent, what you did is managing your wealth, not trying to beat the market/be a professional investor.
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As @nabalzbhf says, you’re good, it seems.
Ahahahaha.
I would seriously consider changing your tax consultant. These guys seem to want to milk you.
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I would also break contact with someone like this. He/she is not trying to help you but play with you not having any knowledge on this topic and getting as much money out of you as possible.
It’s clear that you will not get flagged as a professional trader, as others have said, but if you really wanted to know, just let a friend or relative call the tax office and explain your situation (so there is no trace leading back to you) and ask them for a written response either via email or post letter.
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With a call, it is unlikely that the tax authorities will confirm something in written in a no name basis. Even if they do, it won’t apply to D.Welch.
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Thank you for merging my topic into this thread. I have since read all of the posts here and start to understand how exotic it seems to be classified as pro investor.
It was my new tax consultant in Vaud who imbued these fears in me, as they signaled that they were reaaaally unsure about all this, a borderline case that needed to be thoroughly researched (case files etc.). This stood in strong contrast to my tax consultant in Zurich, who assured me that in Zurich, there was no way to become a pro investor with my profile. He also mentioned to me that there were only a hand full of people in all of Zurich who were classified as pros and that they had Bloomberg terminals at home etc.
My decision forward is to break ties with my Vaud consultant and simply file the taxes myself (As new FIRE, stocks are my only income/wealth, so seems fairly simple). Given all the information in this thread, I understand the worst that could happen is that I get flagged for a sudden wealth increase due to my sale, but I could explain that with my long positions.
Really great to have this forum and the knowledge everyone is sharing. Hope my story can help others as well.
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Hello Colleagues
My neighbour is investing since two decades and has a big Portfolio.
In the next stock market crash, he intends to take a 100k loan from his bank to make best use of it.
I cannot believe that this should be possible, without getting assigned the „pro investor“ status where the tax department will then take taxes on your capitol gains.
I would never take a loan to invest in equity…
What are your thoughts on this stupid idea? Is it stupid or am I stupid by being a conservative investor that only takes a loan on my house, but for nothing Else.
Thanks
Stefan
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Nope, being a pro investor requires a lot more than just having a loan. You also need to behave like one.
How much leverage you use depends on people’s risk assessment. Leveraging is riskier and not for everyone, it works for some and don’t for others, no need to compare yourself 
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I advise you to use the search function on this forum. This topic has already been discussed repeatedly and in great detail. As long as you have a steady income from a job, the tax office won’t care.
Many (financial savy) people invest all their money and instead use credit or margin lines for liquidity.
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There is nothing wrong in talking debt as long as you don’t get over-leveraged and get bankrupt.
Anyone who ever gets bankrupt is mainly because they couldn’t pay back their loans. It’s never because their assets were valued less than before.
In summary - only take debt when you know what you are doing.
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You most likely invest in stocks of companies who themselves use debt and you’d (rightfully so!) berate them if they did not use debt.
So why not use it more directly yourself?
Obviously there’s reasons not to, but your friends strategy is exactly what I have in mind (even more so with Swiss interest rates being so low). I’ve got my finger on the trigger for a significant market drop and am considering then taking a 200k loan to buy a certain stock, then write call options on that stock.
Let me add something in plain: Can you take a 100k loan and directly put that into the ETF market without getting the „Pro Trader Tax Status“?
Why is that? Doesn‘t it say in one of the five rules, that you should only use your own money?
Breaking a rule doesn’t mean you’re pro, it’s just a safe harbour.
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As long as the interest you pay on the loan is lower than the interest and dividend income you’re earning from your investments, you’re not breaking that safe harbor rule. (And to be clear, even breaking a safe harbor rule doesn’t mean that you’ll be classified as professional trader.)
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Jay, can you explain that in more detail?
Interest and dividends deriving from exactly that money from loan? Or from overall portfolio?
I think it is all debt together compared with the taxable income it generates. If total tax generating income estate divided by the generated income is higher than the debt interest percentage you are OK. Self occupied real estate therefor is included in this calculation.
Not sure if all Kantons handle that the same way.
I think professional trader status is not so common. Most people who have this status know that they are professionals
But if in doubt, you can ask Tax office.
Probably not such a good idea, never wake the sleeping dogs.
From the whole portfolio, as I understand it. It would generally not even be possible to determine which investment is paid with what money.
For reference, the exact wording from the Kreisschreiben Nr. 36 is