EXPLAINED: What can I deduct from my tax bill in Switzerland?
Switzerland is approaching its tax deadline on March 31st. Taxes are as inevitable as death and each canton does things differently. But here’s how you can try and reduce your tax burden.
Each year, those liable to pay tax in Switzerland - i.e. most workers - will need to complete a tax return.
The deadline for filing individual tax returns falls on March 31st, though some cantons's due dates — like Vaud and Bern, for instance — have earlier deadlines. The letter you received from your tax office includes the dare by which you should submit your application unless, of course you have already requested an extension.
READ ALSO: How to get an extension on your tax deadline in Switzerland
Due to the complicated nature of tax returns, many internationals will often opt to have their return completed by an accountant or tax professional.
It is also possible to do it yourself - and has gotten easier in recent years with tax declaration software and online returns.
For those who have decided to do their own return here are some common tax deductions you should know about.
Keep in mind however that there are variations from canton to canton, so check with local authorities.
The amount you will pay will also depend on whether you are married or not, with married couples - or those in registered partnerships - expected to complete their tax returns together (though efforts to change this system is underway in the parliament).
These are some deductions may could be eligible for, according to Moneyland consumer platform:
Public transport
If you commute to your job by public transport, you can deduct up to 3,200 francs of ticket costs from your taxable income. If you use your own moped or e-bike (motor speed above 25 km/h) with a yellow license plate, then you can claim a flat 700-franc tax deduction.
Additionally, "you can claim a tax deduction for commuting by car or motorcycle if your home or workplace is located at least one kilometre from public transportation, or if commuting by car results in substantial time savings. The tax deduction is 70 centimes per commuting kilometre for cars, and 40 centimes for motorcycles."
Health insurance premiums
The deduction for health insurance, supplementary accident insurance and life insurance premiums "is combined with the deduction for interest earned on savings," according to Moneyland. This deduction is currently limited to 1,800 francs per adult or 3,600 francs per married couple or registered partnership. If you do not contribute to either an occupational pension fund (pillar 2) or the pillar 3a, then higher tax deductions of 2,700 francs (singles) and 5,400 francs (couples) apply. You get an additional 700-franc deduction for each child or other eligible dependent in your care.
Work-related expenses
A deduction equal to 3 percent of your net salary – with a 2,000-franc minimum deduction and a 4,000-franc maximum one – applies to spending on reference material, specialised workplace clothing, necessary equipment (including computers and software), and some other career-related costs.
Lunches
Also related to your employment, "if you work far from where you live, you can deduct the cost of eating out from your taxable income" Moneyland says. "The flat deduction is 15 francs per workday up to a maximum of 3,200 francs per year. If your employer provides discounted meals, the flat deduction is 7.50 francs per workday up to a maximum of 1,600 francs per year."
Debt
Being in debt is NOT a desirable thing in Switzerland. But in terms if taxes, it is a 'good' thing because interest which you pay for loans can be deducted from your taxable income. "Eligible loans include mortgages, personal loans, and credit card loans, among others," according to Moneyland. "Car leasing payments, on the other hand, are not tax-deductible."
Childcare
The high cost of childcare in Switzerland can be partially offset by the tax deduction.The maximum amount is 25,000 francs.
Education
The costs of education above the secondary level are tax deductible, up to a maximum of 12,700 francs per year.
Retirement savings
Money which you pay into the pillar 3a can be deducted from your taxable income. The maximum amount can change from year to year.
Both compulsory and voluntary contributions to your occupational pension fund (pillar 2) are tax-deductible, as are those those paid into the Old Age and Survivors Insurance (OASI) scheme (pillar 1).
This link lists all the deductions taxpayers in Switzerland are entitled to.
What if you are a freelancer / self-employed?
You too are entitled to some tax deductions, including those related to your business expenses.
You can find more information about this here:
READ MORE: What freelancers in Switzerland need to know about paying tax
As with all of our tax and financial summaries, this is a guide only and should not be taken to constitute specific and tailored financial advice. For tax advice which is personalised to your situation, please contact an accountant or tax specialist.
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Each year, those liable to pay tax in Switzerland - i.e. most workers - will need to complete a tax return.
The deadline for filing individual tax returns falls on March 31st, though some cantons's due dates — like Vaud and Bern, for instance — have earlier deadlines. The letter you received from your tax office includes the dare by which you should submit your application unless, of course you have already requested an extension.
READ ALSO: How to get an extension on your tax deadline in Switzerland
Due to the complicated nature of tax returns, many internationals will often opt to have their return completed by an accountant or tax professional.
It is also possible to do it yourself - and has gotten easier in recent years with tax declaration software and online returns.
For those who have decided to do their own return here are some common tax deductions you should know about.
Keep in mind however that there are variations from canton to canton, so check with local authorities.
The amount you will pay will also depend on whether you are married or not, with married couples - or those in registered partnerships - expected to complete their tax returns together (though efforts to change this system is underway in the parliament).
These are some deductions may could be eligible for, according to Moneyland consumer platform:
Public transport
If you commute to your job by public transport, you can deduct up to 3,200 francs of ticket costs from your taxable income. If you use your own moped or e-bike (motor speed above 25 km/h) with a yellow license plate, then you can claim a flat 700-franc tax deduction.
Additionally, "you can claim a tax deduction for commuting by car or motorcycle if your home or workplace is located at least one kilometre from public transportation, or if commuting by car results in substantial time savings. The tax deduction is 70 centimes per commuting kilometre for cars, and 40 centimes for motorcycles."
Health insurance premiums
The deduction for health insurance, supplementary accident insurance and life insurance premiums "is combined with the deduction for interest earned on savings," according to Moneyland. This deduction is currently limited to 1,800 francs per adult or 3,600 francs per married couple or registered partnership. If you do not contribute to either an occupational pension fund (pillar 2) or the pillar 3a, then higher tax deductions of 2,700 francs (singles) and 5,400 francs (couples) apply. You get an additional 700-franc deduction for each child or other eligible dependent in your care.
Work-related expenses
A deduction equal to 3 percent of your net salary – with a 2,000-franc minimum deduction and a 4,000-franc maximum one – applies to spending on reference material, specialised workplace clothing, necessary equipment (including computers and software), and some other career-related costs.
Lunches
Also related to your employment, "if you work far from where you live, you can deduct the cost of eating out from your taxable income" Moneyland says. "The flat deduction is 15 francs per workday up to a maximum of 3,200 francs per year. If your employer provides discounted meals, the flat deduction is 7.50 francs per workday up to a maximum of 1,600 francs per year."
Debt
Being in debt is NOT a desirable thing in Switzerland. But in terms if taxes, it is a 'good' thing because interest which you pay for loans can be deducted from your taxable income. "Eligible loans include mortgages, personal loans, and credit card loans, among others," according to Moneyland. "Car leasing payments, on the other hand, are not tax-deductible."
Childcare
The high cost of childcare in Switzerland can be partially offset by the tax deduction.The maximum amount is 25,000 francs.
Education
The costs of education above the secondary level are tax deductible, up to a maximum of 12,700 francs per year.
Retirement savings
Money which you pay into the pillar 3a can be deducted from your taxable income. The maximum amount can change from year to year.
Both compulsory and voluntary contributions to your occupational pension fund (pillar 2) are tax-deductible, as are those those paid into the Old Age and Survivors Insurance (OASI) scheme (pillar 1).
This link lists all the deductions taxpayers in Switzerland are entitled to.
What if you are a freelancer / self-employed?
You too are entitled to some tax deductions, including those related to your business expenses.
You can find more information about this here:
READ MORE: What freelancers in Switzerland need to know about paying tax
As with all of our tax and financial summaries, this is a guide only and should not be taken to constitute specific and tailored financial advice. For tax advice which is personalised to your situation, please contact an accountant or tax specialist.
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