6 min read
October 26, 2022
Resource CenterSupported CountriesSwitzerland
6 min read
October 26, 2022
October 26, 2022
At a glance
Check out these tax tips for filing taxes in Switzerland. H&R Block’s tax experts provide essential advice for U.S. Expats.
As a U.S. citizen or Green Card holder living in Switzerland, taking care of your U.S. taxes can feel like a complicated task. Knowing which tax rules affect you and understanding your options is a lot to stay on top of.
With H&R Block, you can rest easy knowing you’ve found the right expertise for U.S. expat taxes in Switzerland. Whether you need expat tax guidance on filing from abroad or information onFATCA and FBARrules, we’re here to help.
Ready to file your expat taxes? We’ve got a tax solution for you—whether you want toDIY your expat taxesor leave it to one of ourexperienced Tax Advisors.Head on over to ourWays to Filepage to choose your journey and get started.
File on my own
What U.S. citizens working in Switzerland should know about U.S. expat taxes
Filing U.S. expat taxes in Switzerland comes with new considerations and questions: “Do I have additional information to report to the IRS? How do my Swiss bank accounts affect my filing? What options do I have to reduce my tax bill?”
For starters, Americans and U.S. Green Card holders living in Switzerland should continue to file a U.S. tax return each year.
Living as an American in Switzerland can affect your taxes even if you don’t stay for very long. For example, if you earn income while on a short-term assignment, you’ll need to report that income on your U.S. taxes. As you establish deeper financial roots in Switzerland, you’ll have more considerations for your American tax filing.
You may need to report your Swiss financial accounts and assets.Generally, U.S. taxpayers with more than $10,000 in foreign bank or financial accounts are subject toFBAR filingand reporting requirements. You may also be subject toFATCAreporting requirements if you have assets valued at $200,000 and higher.
You can lower your U.S. bill and avoid dual taxation with certain tax strategies.Expats may take advantage of one of two options, detailed below, to lower their taxes.
- Theforeign earned income exclusionallows you to exclude your wages from your U.S. taxes. This option is available to those who meet certain time-based residency requirements.
- Theforeign tax creditlets you claim a credit for income taxes paid to a foreign government.
Your total Swiss tax rate – combining federal, cantonal and municipal taxes – will help determine which option is the best for you as an American living in Switzerland. You can rely on your H&R Block tax advisor to confirm the best path for you.
I’m retiring to Switzerland. What do I need to know about U.S. taxes?
If retiring in the Swiss mountains is your long-term goal, you should first understand howtaxes work when retiring abroad. Even if you retire abroad you still may have to file a U.S. tax return. You’ll also still have to report money in any foreign financial accounts on your FBAR if you meet the requirements.
You should know your Swiss pension accounts are not tax-free in the United States.If you have a Swiss Pillar II or Pillar III pension, they aren’t treated like U.S. retirement accounts, such as a 401(k) or an IRA.
- Pillar II pensions– When your employer contributes to your Pillar II pension, those contributions are included in your U.S. taxable income as a U.S. Expat in Switzerland. Your Pillar II account may be subject toFBARandFATCAreporting depending on the value of your account. When it’s time to make withdrawals from your Swiss pension, any amount above the original contributions are taxable. It’s smart to keep good records of your contributions and earnings in case the IRS has any questions.
- Pillar III pensions– If you invest for your retirement through this type of private pension, the income it generates is taxable, even though it stays inside the pension. Additionally, these accounts may be subject toFATCA,foreign trustorPFICreporting depending on the investment type and value of your account.
Switzerland tax filing considerations for U.S. citizens
As an American living in Switzerland, you may have to pay Swiss taxes. Here at H&R Block, we dedicate our expertise to U.S. taxes. If you have questions specific to your Switzerland tax return, it’s best to speak to an expert on local Swiss taxes.
In general, Switzerland taxes are based on your residency status. Swiss tax residents are taxed on all income, regardless of where it’s earned. Swiss nonresidents are only taxed on Swiss-sourced income.
When do you become a Swiss tax resident? According to Swiss law, it’s when you have the intention to permanently establish an abode in Switzerland. You can also be a tax resident if you’re an American working in Switzerland for 30 consecutive days or more, or if you’re there for at least 90 days, even if you’re not working.
The federal income tax rates range from 0% to 11.5%, but local taxes also apply.Similar to taxes in the U.S., the percentage of tax that you pay increases as your income increases into different brackets. While the federal tax rates are lower than American tax brackets, it’s important to remember that cantonal and, in some places, municipal taxes apply. Cantonal tax rates can vary widely, meaning some Americans living in Switzerland may pay a higher tax rate than in the U.S.
With this in mind, you should look at your entire Swiss tax picture to determine the better option for lowering your tax bill: either the foreign earned income exclusion or foreign tax credit. One of our experienced tax advisors can guide you to determine the best choice for you.
2022-2023 Tax Rates for Single Taxpayers
| Tax Rate | Taxable Income |
| 0% | CHF 0 – 14,500 |
| 0.77% | CHF 14,501 – CHF 31,600 |
| CHF 131.65 plus 0.88% | CHF 31,601 – CHF 41,400 |
| CHF 217.90 plus 2.64% | CHF 41,401 – CHF 55,200 |
| CHF 582.20 plus 2.97% | CHF 55,201 – CHF 72,500 |
| CHF 1,096.0 plus 5.94% | CHF 72,501 – CHF 78,100 |
| CHF 1,428.60 plus 6.60% | CHF 78,101 – CHF 103,600 |
| CHF 3,111.60 plus 8.80% | CHF 103,601 – CHF 134,600 |
| CHF 5,839.60 plus 11.00% | CHF 134,601 – CHF 176,000 |
| CHF 10,393.60 plus 13.20% | CHF 176,001 – CHF 755,200 |
| CHF 86,848 plus 11.50% | CHF 755,201 – |
2022-2023 Tax Rates for Married Taxpayers and Single Taxpayers with Minor Children
| Tax Rate | Taxable Income |
| 0% CHF | 0 – CHF 28,300 |
| 1.00% | CHF 28,301 – CHF 50,900 |
| CHF 226 plus 2.00% | CHF 50,901 – CHF 58,400 |
| CHF 376 plus 3.00% | CHF 58,401 – CHF 75,300 |
| CHF 883 plus 4.00% | CHF 75,301 – CHF 90,300 |
| CHF 1,483 plus 5.00% | CHF 90,301 – CHF 103,400 |
| CHF 2,138 plus 6.00% | CHF 103,401 – CHF 114,700 |
| CHF 2,816 plus 7.00% | CHF 114,71 – CHF 124,200 |
| CHF 3,4381 plus 8.00% | CHF 124,201 – CHF 131,700 |
| CHF 4, 081 plus 9.00% | CHF 131,701 – CHF 137,300 |
| CHF 4,585 plus 10.00% | CHF 137,301 – CHF 141,200 |
| CHF 4,975 plus 11.00 | CHF 141,201 – CHF 143,100 |
| CHF 5,184 plus 12.00 | CHF 143,101 – CHF 145,000 |
| CHF 5,412 plus 13.00 | CHF 145,001 – CHF 895,900 |
| CHF 103,040 plus 11.50 | CHF 895,901 – |
The Swiss tax filing season is similar to that of the U.S., but with a few differences.Switzerland taxes follow a January to December tax year. Tax returns are due March 31 and the extension deadlines are at the end of June, September or November, depending on your canton of residency.
How to file U.S. taxes from Switzerland
Need to file U.S. taxes from Switzerland? Here’show to file your U.S. expat taxes online:
- Head on over to ourWays to Filepage
- Pick your journey—in the driver’s seat with our online DIY tool or letting a Tax Advisor take the wheel.
- Once you’re through your chosen journey, you review your return and pay
- We file your return with the IRS
- You sit back knowing your taxes were done right
Need U.S. tax preparation in Switzerland? H&R Block is here to help.
Are you a U.S. citizen living in Switzerland? H&R Block Expat Tax Services is here to help you get your U.S. taxes in order.With multiple ways to file, we’ve got a tax solution for you. Get started with our made-for-expatsonline expat tax servicestoday!
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As an enthusiast with a profound understanding of international taxation, particularly in the context of U.S. citizens residing abroad, I bring a wealth of knowledge to shed light on the intricate details of the article related to filing U.S. expat taxes in Switzerland.
FATCA and FBAR Rules: The Foreign Account Tax Compliance Act (FATCA) and Report of Foreign Bank and Financial Accounts (FBAR) rules play a crucial role for U.S. citizens in Switzerland. The article correctly highlights the reporting requirements for individuals with over $10,000 in foreign accounts under FBAR and the potential application of FATCA for assets valued at $200,000 and above.
Tax Strategies for U.S. Expats: The article touches upon two key strategies for U.S. expats in Switzerland to mitigate their tax liability. The Foreign Earned Income Exclusion allows the exclusion of wages from U.S. taxes for those meeting residency requirements, while the Foreign Tax Credit permits a credit for income taxes paid to a foreign government. The choice between these options depends on factors such as total Swiss tax rates, and the article rightly suggests seeking guidance from tax advisors.
Tax Considerations for Retirees in Switzerland: For those considering retirement in Switzerland, the article offers essential insights. It emphasizes the continued obligation to file U.S. tax returns even while residing abroad. Notably, it points out that Swiss pension accounts, such as Pillar II and Pillar III, have tax implications in the U.S., differing from traditional U.S. retirement accounts.
Switzerland Tax Filing for U.S. Citizens: The article outlines Switzerland's tax system based on residency status, differentiating between residents and nonresidents. It provides criteria for becoming a Swiss tax resident, including the intention to establish a permanent abode and specific durations of stay. The piece appropriately mentions the federal income tax rates and the importance of considering cantonal and municipal taxes.
Swiss Tax Rates for 2022-2023: The detailed tax rate table for single and married taxpayers provides a comprehensive overview of the progressive tax structure in Switzerland. The incorporation of various income brackets and corresponding rates is crucial for U.S. citizens to understand their potential tax liability in Switzerland.
Swiss Tax Filing Procedures: The article compares the Swiss tax filing season to that of the U.S., highlighting the January to December tax year in Switzerland. It mentions the due date for tax returns and extension deadlines, with variations based on the canton of residency.
How to File U.S. Taxes from Switzerland: Lastly, the article provides practical guidance on filing U.S. expat taxes from Switzerland. It directs readers to H&R Block's expat tax services, offering both DIY tools and assistance from experienced Tax Advisors, catering to the diverse needs of U.S. citizens in Switzerland.
In conclusion, this article serves as a comprehensive guide for U.S. citizens navigating the complexities of expat taxes in Switzerland, covering key aspects from FBAR rules to Swiss tax rates and retirement considerations.
