Wealth tax - Does it include cash in a bank account?

I don’t see this as being criminal, since the laws are shaped in a way to not only tolerate but encourage that.

And tbh… I don’t really care :smiley: I’d do a lot for my FIRE goal if there was no chance of tracing it back to me. But I am not stupid or over confident… This case however is basically a free pass. I know a lot of people who do that, even with more cash.

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In the pursuit of not having what I do being traced back to me, I would avoid speaking about it publicly on an open board. :wink:

Yeah and if you are a billionaire, an account with 10M or 20M is also “inconsequential” for taxes. It’s super funny how playing the system is marked as “bad” while rich people evade tons of taxes by doing so lol.

Not declaring all your assets in your tax declaration is illegal, period. Stop trying to justify or promote your behavior. Last warning before suspension.

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The chances of this being found out and perused are minimal. And even if… They’d rather give me a call than a letter from the district attorney. We are talking about peanuts in my case - but Saved peanuts :money_mouth_face:

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It’s obviously not… It would be a lot more than 10chf of taxes…

Ok… understood in 20 chars

The best way to save on wealth tax is to move to a canton with low wealth tax and high wealth exemptions. Deliberately not declaring your wealth is against the law, and wealth tax is very low in most cantons. I’d look into legal ways to minimize taxes.

As a person who is taxed at source, you only need to worry about wealth tax if your taxable wealth exceeds the threshhold (80k for a single or 160k for a couple in the canton of Zurich), in which case you need to fill out tax returns. Until then, it’s covered by your withholding tax. Btw, pillar 2 and 3 assets do not count towards taxable wealth, so making voluntary contributions to the pillar 3a and your pension fund is an option for reducing taxable wealth.

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Especially, when the wealth tax is very, very low.
Even if you are single and live in 8001 with CHF 1m assets, the taxation is 0.2094% - risking something for that? Hell no.

You should aim for the income taxes, not welath tax, @CHRad :wink:

But this is just an addition, since it does not really contribute something to OP’s question.

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The even better way is to take a combination of some of your low risk investments and a matching amount of shares; and invest this into a Swiss Real Estate Fund that directly owns the assets. There is neither Wealth Tax on these funds nor Income Tax on their Distributions.

Clearly, this only works on a smaller scale but if your asset allocation was 60% shares / 40% non-risk assets; you could move to 55% shares, 35% non-risk shares and 10% such real estate funds. Expected return remained as-is yet at a reduced tax burden.

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I know a few swiss people that do not declare everything as well. Specially deals made in cash. Probably they do other things with the tax declaration.

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As much as I understand the logic you state, I do not agree with it. The money is ALREADY in productive use. Or you think the bank has 100% of my cash in liquid stored in a safe box? They earn money with our money.

And yes @Cortana it is theft. Because it is a double tax. All that money already paid taxes. The fact that they do it and it is legal it doesn’t mean it is fair. This is exactly the same as if my son inherits the house when I die. Every single cent of the money I paid for the house was legal, I paid the taxes when I bought it, I paid the taxes while having it. Why does he have to pay again? It might be how the law is, it doesn’t mean it is fair.

But… hey! This is more of a philosophical discussion haha. Want to say that thank you everyone for your comments, really appreciate them. Made me learn a lot in just 2 days.

@Cortana, @Julianek it is not a crime, for god’s sake. I am even unsure if “illegal” is the term to use. Thanks to CHRad comments, I spent a few hours yesterday reading about this. And what I found was that in Switzerland what he proposes and adapted to my case, not only IT IS NOT tax fraud, it is not even tax evasion (which is an administrative offense, so not a crime). Simply not doing a tax declaration is another category that is punished with a max of 1000 CHF. Which in my case, it is probably cheaper than : paying the wealth tax (double tax) and the time spent on : finding a treuhand, paying him, collecting all the data, phones/emails with the tax bureau, etc. And even I risk the tax declaration is negative so I end up paying more taxes. It is absolutely stupid, really.

I really struggle to understand why people is so pissed off for paying multiple taxes, at the end of the day if you pay 10 times 1% or 1 time 10% it’s the same…and having multiple taxes gives the government some flexibility to incetivize or deter different activities.
Sure we could remove wealth tax or inheritance tax but we’d need to increase income tax instead. Please don’t.

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This is how the system works. A company buys goods and is paying MwSt, then it’s paying taxes on its earnings, you’ll pay income taxes for the salary you get from this company, later you’ll pay taxes on the dividends you’re getting from the money you earned and invested in stocks, then wealth taxes once you amass enough assets. So you see we don’t get taxed twice but multiple times down the way.

You could abolish MwSt, income taxes, taxes on earnings, wealth taxes etc. and just double or tripple earning taxes for companies. They would pay you less and increase their prices. You would live “tax free” in Switzerland but your purchase power will be identical to the current system.

Simple isn’t always better.

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hehe… again, it is a philosophical question sort of. But I like it :slight_smile:

All the chain of taxes you mentioned have a sense. If you make money, you pay money. If you have money sitting in a bank account not generating any profit… and that money is coming from your salary that also paid taxes… that is a double tax my friend. You can paint it any way you want.

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Would you rather get taxed on capital gains like the rest of the world? I wouldn’t and that’s why I like the system in Switzerland.

The current system is favoring investing your money and putting it to use for the society and economy. People that leave it on the savings account get punished.

If we abolish wealth tax and establish capital gain taxes we would end up in a worse situation. People without investments wouldn’t pay any taxes and people with investments would get taxed heavily once they sell something for a profit.

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Doesn’t (most of that) rest of the world get CGT exemption if asset is held for n years (e.g. 2-3) before selling?
That would likely have 0 impact on ETF buy’n’hodlers.

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Yes. Let me be clear: I generally don’t have any complaint regarding Switzerland. I found almost all they do is super fair. Forcing people to acquire financial knowledgment and/or deposit trust on companies or institutions at the cost of an economic penalty I see it as (yet another) intromission of the government into citizens private life. Not good. In my particular case I can tell you why I don’t want to put that money “to work” (keep in mind the bank is already doing it btw, they run a business. The money is not stall for sure.). Wherever I put the money now, if I need it in the next 2-3 years I am going to incur in a heavy risk. Imagine I buy now SP500 indexed ETFS and they go down and I need to sell them. Locked. Imagine I buy 5 year bonds or whatever and I need to sell it. Locked. Just let people live and do whatever they want with their legal, hard earned money. I totally get your point but that’s how I see it. Always feel raped when the govt./state gets its nose into my private things.

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Ok we’ll stop the thread here.

  • You asked if you have to declare your bank accounts in your tax declaration. Yes, you have to. Not doing so is punishable by law, as you confirmed in your message.
  • I don’t care if you think this is fair or not. The tax system is what it is in Switzerland. You could be the reincarnation of Ayn Rand or Karl Marx, it is not going to change. I even higlighted in the moderation policy that this kind of discussion is not helpful and highly discouraged.
  • You are welcome to do anything you want in your private life, if you are willing to bear the consequences. But advocating for an illegal behavior on a public forum is a completely different animal:
    • Legal repercussions could close the forum
    • and personally, as a moderator i have absolutely no desire to bear any liability because of what you are advocating for.

So we’ll stop there. You got the answer you were looking for. No need for any additional drama.

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