I am trying to group up some of my questions in one thread to not spam the forum.
So currently I live in canton St. Gallen, but work in Zürich, I like this smaller town lifestyle, close to the mountains, but taxes are higher than Zürich/Zug etc. so I will probably move, however I would like to see how much I would pay in taxes in different cantons with deductions and all that to see the ‘cost’ of me moving or staying. My German is work in progress, so I think using the cantonal tax programs would be difficult to test all this myself.
1, Would it be worth it for me to consult with a tax specialist to discuss this + to help me fill out of my tax returns for the first year (then I could do them myself if I have a blueprint for it). How much does this usually cost?
2, Is it legal and possible to move cantons towards the end of the year to save on rent and taxes? E.g I move in November to Zug, paying the lower rent in SG and then filing the Zug tax returns. If I’m correct you pay taxes in the canton where you are on the last day of the year.
3, Would it be correct to say that 3. pillar is worth it if my marginal tax rate is higher than my tax rate would be on withdrawal? How do I know my withdrawal tax rates for 3. pillar?
4, How does this 5 account system work exactly? I just open up 5different accounts at VIAC or finpension (are these equally as good?) and then divide the yearly 3. pillar by 5?
5, What are the best option for a 3. pillar portfolio? Since it’s taxable, and my personal portfolio is more aggressive than most here (not VT) I would probably keep this on the safer side. I know I can recreate VT in 3. pillar, but are there other good alternatives?
Have you tried https://swisstaxcalculator.estv.admin.ch/#/calculator/income-wealth-tax? It’s not perfect as you don’t have all the specific canton deductions, but it’s a pretty good start and in English. Tax filing should be around a couple hundreds I believe, might be more since you say you have an aggressive (and complex?) portfolio. No idea for the tax comparison work.
Yes, as long as it is truly your new main place of residence, and not just something to be there on the 31st of December that you will move away from right after. Note that this only applies if you fill an ordinary taxation (even if taxed at source). If you don’t, then the tax rate is monthly.
Yes, but as far as I know it should almost always be the case. See this table for some examples of the rates. I believe the exceptions would be: if you have a truly low income, especially in a place like Geneva that has no income tax on low revenues; if you don’t fill an ordinary taxation as you can’t claim the tax deduction; if you are a US citizen, as what you don’t pay in Switzerland you end up paying in the US (but only from 100k or so?).
Pretty much, see this article for instance. If you look around the forum, you should find some discussions about the specifics (should I fill a new one once the previous is full? Change every year? …)
What do you mean by “it’s taxable”? You do pay some taxes on withdrawal (see 3.), but don’t pay taxes on wealth and income (dividends) whilst in the 3rd pillar. Otherwise, I don’t have a good answer for you, so I’ll let you look around the forum, or someone else can chime in.
If you spend an hour with the link Ilixio sent you’ll get an order of magnitude estimate as good idea as any “tax specialist” will give you, for free.
Or Comparis has an easy to use tool for tax at source.
If you evaluate it makes sense to invest in 3rd pillar I would recommend to keep your life simple and open 1 account. Open 2nd account in a few years, …etc
Disagree. OP is clearly lacking experience (3rd pillar, 5 account system, taxes,…) and a good tax advisor can help clear things up and give him input. We are maybe talking about a CHF 150-250 investment here.
I was referring only to the “how much tax will I save if I move to another canton” question
If OP puts gross salary in the comparis tool above in 1 minute it will spit out the taxes to be paid in SG and every other canton in Switzerland assuming tax at source (even if OP is a tax declarer it is good enough to get a first idea before deciding whether to delve deeper)
For example for a single person with gross salary 10k per month tax at source in SG would be ~17k per year and in Zug ~10k. Savings in the ballpark of ~7k /yr
[Edit: I read it wrongly, tax in Zug would be ~7k, saving in the ball park 10k/yr]
You didn’t say, but I assume you are a foreigner on a B permit?
In this case, you are subject to the withholding tax (WHT): every month a canton specific tax is levied on your salary.
Then, depending on your income, wealth, and other conditions you might have (or can request) to fill an ordinary taxation tax return (i.e. like a Swiss citizen or C permit holder would). Basically, you have fill your income, wealth, apply for deductions and so forth. The WHT will then be used as an advanced payment against the final sum. In this case, your final tax rate will depend on the place you live (both canton and town) at the end of the year (even if you paid 11 months of WHT in one canton and 1 in another).
Otherwise, you don’t have to fill any tax return. There are some default (and usually pretty generous) deductions included, but you can’t claim the 3rd pillar deduction. In this case, the WHT is all you have to pay, and won’t be adjusted depending on where you live at the end of the year.
Yes, I’m on a B permit, but I will request to fill my taxes this year and most likely move at the end of next year. So in that case I should be fine then.
I got confused, because you said even if taxed at source, but now I get it, thank you!
When I changed from tax at source to tax declarer my tax bill went up by a couple of '000 - in addition to the pleasure of having to complete the declaration!
I believe the assumptions in tax at source were quite generous if you have a simple taxation situation (I was single with no kids, no property, no debts). Maybe it varies per canton or has changed in the meantime
Well, for this year I spent 6 months working as an intern, and now 6 months as full time, so taxing at source does not take that into consideration. And there are quite a lot of deductions, I’m not sure how at source could come out better with those in mind, but I need to play around with the calculator I guess
Well, surprisingly after using the site with all the deuctions it seems like I could save the most money in SG compared to Zurich, Winterthur and Zug.
My current rent is 850~ with nebenkosten, and I would save approx 400 on taxes + GA a month in Zurich and 600 in Zug. From what I saw in rental sites finding even a 1-2 room studio for 1200-1300 in Zurich or 1400-1500 in Zug is not that likely.
Im a bit surprised by the results, but maybe I missed something. (i deducted travel, meal, rent, insurance in all instances)
This is on 100k ~ income, seems like Zug would beat SG at around the 115-120k a year level, so I might delay moving to the end of 2026 instead of 2025, where I could be at that salary hopefully. Until then I will enjoy the SG life
I am not. There is always some kind of equilibrium been established between regions with different properties, financial or what not. If the taxes are lower, than the rents are higher, and 100k income is not enough for lower taxes to compensate for higher rents.
Assuming you are single without kids then your marginal tax rate in SG is about 23%. Contributing the full 7k into 3 pillar will reduce your 2024 tax bill by about 1.6k CHF.
When you withdraw it in the future you will have to pay tax. For SG residents the rate is about 8%.
So it could be worth it. However check if it means you have to change to tax declarer to be able to claim the deduction, since that might mean you actually have to pay higher taxes as a result (in addition to locking your money away)
so basically if we hold B permit and have 3rd Pillar, either we fill the tax ourselves to be able to deduct the 3A investment, or we just get taxes at source but then putting money in our 3a pillar should be for a reason other than getting ax deductions?
Also, if we hold few VT in Interactive Broker or Degiro, how should this be declared if holding the B permit? Could i just declare it once I have the C permit?
The principle of Quellensteuer kind of assumes you do not have significant sources of income or wealth outside the system which already taxes the income at source.
With respect to income tax , assumption is that all your income is getting taxed at source.
salary via employer
Interest income via bank
Dividends via broker
However if you hold investments with foreign brokerage or banks, then you are not paying enough tax and there should be some sort of threshold by canton where it becomes an obligation to file return.
With respect to wealth -: similarly if you have significant money in ETFs , it would be good to check with tax office where the threshold lies.
I found an article about Bern , similar info should exist for all cantons
interesting article, thank you. Just so I got i correctly: assuming that salary is below 120K, wealth below 150K and income from investments is less than 3K, someone could just keep the tax at source model, isn’t it?
I think it depends on canton but yes if you are within limits then canton doesn’t care
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