Do you plan on leaving Switzerland permanently in the near future? Might you be relocating for business purposes? Perhaps you instead wish to experience what other nations have to offer. Either way, it is crucial to appreciate how this move may affect your taxes and pension.
Let us look at some concerns and how you can be fully prepared for what is in store.
How Will Leaving Switzerland Permanently Affect Your Bank Account?
It is not uncommon to open up a separate bank account once you have officially left Switzerland. However, many individuals will choose to retain a domestic account. This is even more important if you happen to be receiving an ongoing form of supplemental income.
Note that non-resident surcharges may sometimes apply after you have departed Switzerland. Therefore, it could be wise to open up an international account while you are still a legal resident. Here are some of the banks that are located in Switzerland (1):
- all Cantonal Banks
- Swissquote Bank
Of course, it is always recommended that you consult Marcel Chevrolet to learn more about your options.
Health Care for Swiss Émigrés at a Glance
As this article notes, healthcare is another logical concern to address. The good news is that you can retain your original plan. The only caveat is that this coverage will normally expire after 120 days.
Nonetheless, there are possible exemptions. For instance, you may be provided with an extension if you have relocated at the behest of an employer. In this scenario, the policy in question can remain valid for up to six years.
How Will Your Pension be Affected After Leaving Switzerland Permanently?
Pension plans are yet another area to address. Of course, leaving Switzerland permanently is much different than simply changing employers. The main issue here is whether you will be relocating to an EU or non-EU country.
If you relocate to a region outside the European Union, your funds can be withdrawn without any issues. It is recommended to transfer your assets to a vested benefit foundation in a canton with low taxes.
Things are slightly more complicated for those who plan on living in an EU nation. These are the rules:
- You may choose to withdraw your extra mandatory part after leaving Switzerland permanently, but this is not a necessity.
The mandatory (LPP) part can only be paid out, when:
- turning 60 for men and 59 for women or
- Financing a home or for the downpayment of an existing mortgage.
Note that such an action will be subject to a capital withholding tax.
It should be mentioned that the tax rate is associated with the domicile of the foundation of the vested benefits. It is not applicable to your physical (or prior) address in Switzerland. In this case, you could very well enjoy tax savings as high as 50%, if you select one domiciled in a low-tax canton.
Might You Still be Required to Pay Swiss Taxes?
There are certain instances when émigrés may be obliged to pay domestic Swiss taxes. These generally occur when individuals are financially “tied” to Switzerland in some form. Here are some theoretical examples:
- If you are located abroad and still contracted to a Swiss-based firm.
- In the event that you own a Swiss property (capital gains taxes apply).
- If you still legally own a home in Switzerland.
If none of these cases is relevant, your obligations will no longer apply once the de-registration process is finalized.
Double Taxation Concerns to Address
What if you will be relocating to a country associated with double taxation? In this case, it is possible to reclaim the withdrawal tax. However, you will first need to prove that you are a legal tax resident within the country of relocation. Note that Swiss émigrés may still be subject to income tax obligations associated with their new residency.
Time for a Much-Needed Change?
It is clear to see that several factors should be addressed before leaving Switzerland permanently. Thankfully, many émigrés have already benefited due to assistance from Chevrolet Consulting GmbH. You may even be able to save up to 50% in taxes with my help.
Would you like to learn more about the emigration process? Do you have additional questions that require professional advice? If so, please contact Chevrolet Consulting GmbH for a free consultation. I have the answers that you have been looking for.
“I guide you through the administrative jungle”