Contracting in Switzerland (tax)

[oxtailsoup]

Yes I know that there have been topics on this previously, I have read them! But I just wanted to clarify the situation if possible.

I have been offered a 3 months contract in Geneva. The agent has appointed a Swiss tax advisor to explain how much money I will get.

The figure he has come up with is roughly 80% salary retention. This is by maxing out my pension contribution (30% but I get it back once contract has finished so its like a savings scheme) and various other bits and pieces (something to do with an E101 form).

Anyway after reading through some of the old Swiss tax topics on here it has got me worried because if you work less than a year in Switzerland (may be 9 months) you will still have to pay tax in the UK (less any tax already paid in Switzerland). Is this correct? Because this could work out very costly.

My worry is that not only would I end up paying around 40% tax once I returned to the UK, I would also be out of pocket for my weekly expenses which as I'll be commuting will amount to around £400 per week.

If this is the case then I may have to turn down the contract offer.

The contract is for 3 months and I don't know how long it would extend for at this stage. Possibly 6 months, I don't see myself commuting to Geneva for 12 months.

[Euro-commuter]

after reading through some of the old Swiss tax topics on here it has got me worried because if you work less than a year in Switzerland (may be 9 months) you will still have to pay tax in the UK (less any tax already paid in Switzerland). Is this correct? Because this could work out very costly.

My worry is that not only would I end up paying around 40% tax once I returned to the UK, I would also be out of pocket for my weekly expenses which as I'll be commuting will amount to around £400 per week.

And remember that if you are employed in Switzerland, HMRC will regard weekly travel not as a business expense but as a lifestyle choice, i.e. not something they'd let you deduct from income.

[oxtailsoup]

The agent has agreed that the above is correct (i.e. I can be taxed again on return to UK) so have suggested that I work through my UK limited company for 3 months. I presume that the travel expenses will be claimable in this case?

[Euro-commuter]

The agent has agreed that the above is correct (i.e. I can be taxed again on return to UK) so have suggested that I work through my UK limited company for 3 months. I presume that the travel expenses will be claimable in this case?

I presume so too: your base would then be your UK Co registered office.

[The Lone Gunman]

The agent has agreed that the above is correct (i.e. I can be taxed again on return to UK) so have suggested that I work through my UK limited company for 3 months. I presume that the travel expenses will be claimable in this case?

Not sure about Switzerland, but.....

If it is a short term contract then you will not become "tax resident" locally (as I said, not sure about CH so you need to check).
If you do have to pay tax locally and it works like other Euro countries then you will pay local tax on what you eran there i.e. your salary. DO NOT take any divvies whilst working there or these will become part of your income.
If you and your company become tax resident then this all changes.

I do work with a guy who has moved to Ch because of its favourable tax regime so you may want to look into that.