So there was some trepidation this morning that whilst searching for a Networking Diagram, I came accross our [unpaid] tax bill for June 2011. Shock and horror!
So how does the Taxation system work?:
- If you arrive in Switzerland and receive an L or B permit you will be taxed at source
- Here tax is deducted from your salary as it is earned (like in the UK Pay As You Earn PAYE for example)
- Unfortunately when both you and your partner work (traditionally the wife does not work) then the salaries are added together
- In Switzerland ALL your salary is taxed at one rate
- So, when your combined salaries are taxed cummulatively the rate can skyrocket
- Example, our individual tax bands are say 30%, but on our combined salary perhaps > 40%
- So at each year end reconsiliation we have had to remember to save an Audi TT S Black Edition in cash. That's the extra tax we pay because we are married! And no, I am not kidding!
Time passes and we have a better class of Residence permit. Now :
- No tax is deducted at source
- At the end of a year you tell the Canton your combined total earnings, & they work out the tax for the next year and you pay this monthly.
- Naturally this assumes you don't ever change your job / salary, else your tax situation gets very complicated!
The only benefit will therefore be at the end of year we don't land ourselves the mother of all tax bills.
Thanks Switzerland, I think :-!