Taxes for US Citizens living in Switzerland

Your income over 120’000 is treated exactly like your income under CHF120’000 — your tax (‘quellensteuer’) will be withheld by your employer each month at a rate determined by your monthly pay. Hereisthetableof Quellensteuer rates for Canton Zug. This table is for a family where both partners work — there are similar tables available for single earners.In this example, if you were earning 180’000 a year (15’000 a month), you would be taxed at source at a rate of 9.21% if you were the husband, or 10.67% as a wife, assuming no kids. (Don’t get started on sexual inequality. That’s the way the system works here).If you earn less than CHF120’000 a year, that’s it. You’ve met your tax liability. If you earn over 120’000 a year, however, you need to file a return at the end of the year. This can either work out in your favour or against you, depending on your circumstances, and you’ll either get a small refund or have to pay a small additional payment. But in either case, the tax withheld should cover the lion’s share of your liability.You’ll need to pay wealth tax, too, but this isn’t typically a huge amount (unless you’re hugely wealth) and it doesn’t kick in until a certain level — from memory, about CHF250’000 in assets. Here’s a thread with some tools to help you find out what it might be in your case:Property/Wealth tax in canton ZugDon’t pop the champagne corks quite yet. If your Swiss tax liability is significantly less than your US tax liability, you’ll probably owe a check to Uncle Sam as well. It’s a false economy for most Americans to live in low tax cantons, as rents are higher but you don’t profit from the lower taxes (as you’ll owe the balance to the US).A lot of people get worked up when they hear about the wealth tax, but unless you have very substantial wealth, the amount isn’t likely to be enough to be a dealbreaker one way or another for making a move. As an example, with CHF250’000 in wealth, you wouldn’t pay any wealth tax, and with CHF500’000 in wealth would pay about CHF350 a year; CHF1’000’000 would pay about CHF1’750 a year and someone with CHF5’000’000 would pay around 13’800.Here’s a presentation that gives a reasonable overview of Swiss taxes, in English. Note that slide 11, which I’ve used to calculate the wealth tax examples above, is quoted permille (‰), not percent (%). 

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