Zurich effective tax rate 42%!

Avanade
Calmar

Go to company page Avanade

Calmar
Mar 19 21 Comments

Living in England, checking for alternative low tax countries in Europe. The effective tax rate for an income of 200K in Zurich is 42%! I thought Switzerland was a "tax heaven" or at least it had reasonable tax rate. My understanding was that the tax rate for income would be between 20-30%.

Source: https://ch.talent.com/en/tax-calculator

Is it even worth it to move to Switzerland? And please don't suggest Eastern European country as an alternative!

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TOP 21 Comments
  • Yelp
    YmwyJsWX

    Go to company page Yelp

    YmwyJsWX
    I think you might be the only one who heard that myth - Switzerland has never been branded a tax haven, historically it has been a banking haven for those who seek out secrecy (and in many cases this was people who were hiding the money from their own country’s tax authority). That may sound similar but it has nothing to do with permanent resident or citizen taxation. The actual residents pay some of the highest taxes in the world and enjoy a very high standard of living for it, but it’s not somewhere you seek out for a discount! Unless you live for super clean streets and hate warm human interaction, you probably don’t want to live in Zurich… it’s beautiful but sterile and I found it boring after a few days.
    Mar 19 0
  • Wayfair
    cjovr73

    Go to company page Wayfair

    cjovr73
    It's tax heaven to hide black money and not white 😂
    Mar 19 0
  • New
    oHUw45

    New

    oHUw45
    The site you shared shows a 32% average tax rate at 200k income for me.

    Also you don’t have to live in Zurich, there are cantons where you can get to 26ish%.

    Thirdly part of what they show is pension contributions which you can actually take with you when you leave Switzerland.

    Lastly you have to consider that you can make a ton of deductions on your tax declaration, so your actual tax bracket might be substantially lower than the 200k you make. You then also pay that lower tax rate only on your income minus deductions.

    It would be interesting to create a holistic comparison between international tax regimes, taking factors such as the ones mentioned above into account.
    Mar 19 2
    • Avanade
      Calmar

      Go to company page Avanade

      Calmar
      OP
      Scroll down further on that page and you will see the real tax rate is 39.8%

      What deduction can you make?
      Mar 19
    • New
      oHUw45

      New

      oHUw45
      The 39.8% includes your employer’s contributions. You don’t have to pay those. If your contract says 200k then you only pay your personal tax contributions on that and keep the rest.

      In terms of deductions there are a slew of deductions on the federal and cantonal/communal level. Some are “automatic” (pauschal) such commuter’s deduction, some you have to prove that you had expenses, such as childcare costs.

      Listing all the deductions would be too long for this post and I am not a tax advisor/expert. But a family with two children can typically deduct around 40-50k.
      Caveat: This number depends highly on your personal financial situation, and the canton/gemeinde where you live. Also the tax legislation is changing constantly.

      Consult your Swiss tax advisor for real tax advice though ;)
      Mar 19
  • Switzerland is also expensive AF, and honestly, it's a little overhyped, it gets boring fast.
    If your employer can make the proper arrangements, you may as well move to Neatherlands and take advantage of the expatriate incentive (max tax rate at 34.3%).
    Otherwise, keep where you are until you have enough money to retire, move to Portugal, Spain or somewhere else cheap.
    Mar 19 3
  • Amazon
    ddlz24

    Go to company page Amazon

    ddlz24
    Much better site for tax calculation - https://incometax.ch/ - I can confirm this is accurate (for me at least).

    On a 200k CHF salary at a Swiss company, you will net about 12450 CHF into your bank account monthly (around 75%) and that's after pension contributions, unemployment insurance, etc.
    Mar 24 2
    • New
      oHUw45

      New

      oHUw45
      Seems about right. That’s if you pay Quellensteuer. I think you would pay a little bit more with regular taxation.

      Is Amazon hiring SWEs/EMs in Switzerland?
      Mar 24
    • Flagged by the community.