Taxing of natural persons

Philippe FRESARD, notary and lawyer in Berne and Manuel PIQUEREZ, notary and lawyer in Porrentruy

All natural persons who reside on a permanent basis in Switzerland, have a money-earning activity there or own a property there should in principle pay federal, cantonal, communal and ecclesiastical taxes. The Confederation levies income tax whereas cantons and communes levy both income and wealth taxes.

Income tax

Income tax represents the largest contribution. It covers the taxpayer’s whole revenue, i.e. income from principal and accessory money-earning activities, income acquired in compensation or replacement, the products of capital, etc. It is possible to deduct the expenses necessary to obtain that income from the gross income. In addition, various social deductions are allowed, e.g. for married couples, children or dependent people. Income tax operates on the basis of progressive tax scales. Foreign workers without a residence permit pay their federal and cantonal taxes at the source, i.e. they are directly deducted from their salary, which is exceptional in Switzerland.

Wealth tax

Wealth tax is calculated on the taxpayer’s net capital, after the deduction of all debts. Tax rates are progressive and vary considerably between the cantons and communes.

Berne/Porrentruy, 30.01.09