Contracting in Switzerland - Let the Naive Beware!

[NotAllThere]

... For those who are less than perfect the thread will hopefully point out what not to do, which was my intention in posting it.

Which is good. But you also want to generate discussion and find out other people's perspectives. It's good to have friends who support you, but while the advice and comments you get here may not be presented with a spoonful of suger, it is (generally) objective, and does come from a people who have been round the block a few times.

btw - in the other forum, someone posted "You've been Switzerlanded". There's the same concept here: "you've been MFd". I note that in the EF thread, you've also taken offence at some responders, so it hasn't all been sweetness and light over there either.

[Ignis Fatuus]

1. Switzerland is quite expensive.
2. In most countries contractors expect to pay health and social contributions in the same way as any employee.

I thought most people knew those things even without doing any special research.

As NotAllthere pointed out, your "extra" UK tax merely brings your tax rate up to UK levels. Since you reside in the UK, you must expect to pay UK levels of tax. I wouldn't have thought that would come as a surprise. Also, the "compulsory insurances" correspond to the UK NI that you won't be paying. You can hardly blame Switzerland for not having the same NI-avoidance gimmick that many contractors use in the UK.

[BlasterBates]

If you work through a Swiss payroll company then you are employed. Employment income is not taxed again in the UK, there is no top up tax on this form of income, this is the way to work in Switzerland.

Double taxation treaties are complicated, and it is important to take good advice from a reputable accountant.

I live in Germany and work in Switzerland and I'm only taxed on dividends and interest in Germany, for which there is a top-up tax to pay, there is no "top-up" tax on my employment income, even though the German authorities deem me to be domiciled in Germany. In the UK it would be the same. I disagree the UK would tax you an extra 15% provided the Swiss authorities tax you as a Swiss resident. If they don't tax you as a a Swiss resident then you have less to pay, no Insurances. In that case indeed maybe there would be a top-up tax but no Insurances to pay. Either you pay Insurance in which case you are taxed as full Swiss resident for 90 days (I think) you're there and no top-up tax or you don't have any of these deductions and you pay a limited tax which I presume would be taxed with credit in the UK.

I pay 1100 CHF for my apartment. You can get rooms with a telly and shared kitchen, bathroom etc for CHF 800. Obviously for the first few weeks you need a hotel, but there are quite a few relatively cheap hotels for CHF 80 a night.

I've just checked www.homegate.ch and there are two pages worth of one room appartments, and rooms available for less than 1000 CHF in Zurich.

[Lumiere]

Multiply your cost of living by about 0.3 to get a comparable Swiss cost.

Are you saying the UK is 3 times cheaper than Switzerland, or that was meant to be 1.3 ?

[IanSmithUK]

Which is good. But you also want to generate discussion and find out other people's perspectives. It's good to have friends who support you, but while the advice and comments you get here may not be presented with a spoonful of suger, it is (generally) objective, and does come from a people who have been round the block a few times.

I did want to generate discussion, but a troll like MF being offensive from the "get go" does not generate discussion, just a "conversation" that quickly degenerates into name-calling and unnecessary heat. I doubt very much he'd behave that way face-to-face. As for the "friends who support you" - it didn't feel that way, let me tell you, not with all the abuse I got for being so stupid as to waste time arguing with someone everyone else quite clearly thought was "an idiot with no life just getting his pleasure out of being obnoxious on an internet forum".

And the phrase "around the block a bit" can apply to different areas. MF may well have been "around the block a bit" but didn't contribute anything of value other than to presume what I was like to work with and bitch and whine (or as another user here put it "rant") I've been around the block a bit myself (3 years in Saudi, 2 years in Kuwait, a year in Germany, a year in Ireland, six months in the States) - none of it was relevant to what I posted here.

btw - in the other forum, someone posted "You've been Switzerlanded". There's the same concept here: "you've been MFd". I note that in the EF thread, you've also taken offence at some responders, so it hasn't all been sweetness and light over there either.

Not sure what you mean by my having "taken offence" in the EF thread. Your interpretation, not mine. I did vote a "groan" at one post where the poster told me I was stupid because I'd taken the contract and not done my research. Somewhat ironically he hadn't done his research, because if he'd actually read the post he was rushing to respond to he would have seen that I stated quite clearly that I DIDN'T take the contract.

As for the whole "Long, rambling" thing. Well yes, that's a fault of mine. So crucify me for it. God forbid that someone should be long and rambling in trying to get the details of something across. The irony is that I had two friends who agreed before I posted it, that it was "too long and rambling" and they edited it down for me. What was posted was their edited result. Oh well, I guess I need to find friends who are better at precising.

[NotAllThere]

Are you saying the UK is 3 times cheaper than Switzerland, or that was meant to be 1.3 ?

Yes - 1.3! :

[NotAllThere]

I did want to generate discussion, but a troll like MF being offensive from the "get go" does not generate discussion, just a "conversation" that quickly degenerates into name-calling and unnecessary heat. I doubt very much he'd behave that way face-to-face. As for the "friends who support you" - it didn't feel that way, let me tell you, not with all the abuse I got for being so stupid as to waste time arguing with someone everyone else quite clearly thought was "an idiot with no life just getting his pleasure out of being obnoxious on an internet forum".

And the phrase "around the block a bit" can apply to different areas. MF may well have been "around the block a bit" but didn't contribute anything of value other than to presume what I was like to work with and bitch and whine (or as another user here put it "rant") I've been around the block a bit myself (3 years in Saudi, 2 years in Kuwait, a year in Germany, a year in Ireland, six months in the States) - none of it was relevant to what I posted here.



Not sure what you mean by my having "taken offence" in the EF thread. Your interpretation, not mine. I did vote a "groan" at one post where the poster told me I was stupid because I'd taken the contract and not done my research. Somewhat ironically he hadn't done his research, because if he'd actually read the post he was rushing to respond to he would have seen that I stated quite clearly that I DIDN'T take the contract.

As for the whole "Long, rambling" thing. Well yes, that's a fault of mine. So crucify me for it. God forbid that someone should be long and rambling in trying to get the details of something across. The irony is that I had two friends who agreed before I posted it, that it was "too long and rambling" and they edited it down for me. What was posted was their edited result. Oh well, I guess I need to find friends who are better at precising.

Maybe they could have practiced their skills on the preceding!

If you don't like someone's response, either pm a mod (or hit the abuse button), or add them to the ignore list. Don't start

hth

[IanSmithUK]

If you work through a Swiss payroll company then you are employed. Employment income is not taxed again in the UK, there is no top up tax on this form of income, this is the way to work in Switzerland.

Double taxation treaties are complicated, and it is important to take good advice from a reputable accountant.

I live in Germany and work in Switzerland and I'm only taxed on dividends and interest in Germany, for which there is a top-up tax to pay, there is no "top-up" tax on my employment income, even though the German authorities deem me to be domiciled in Germany. In the UK it would be the same. I disagree the UK would tax you an extra 15% provided the Swiss authorities tax you as a Swiss resident. If they don't tax you as a a Swiss resident then you have less to pay, no Insurances. In that case indeed maybe there would be a top-up tax but no Insurances to pay. Either you pay Insurance in which case you are taxed as full Swiss resident for 90 days (I think) you're there and no top-up tax or you don't have any of these deductions and you pay a limited tax which I presume would be taxed with credit in the UK.

I pay 1100 CHF for my apartment. You can get rooms with a telly and shared kitchen, bathroom etc for CHF 800. Obviously for the first few weeks you need a hotel, but there are quite a few relatively cheap hotels for CHF 80 a night.

I've just checked homegate.ch | Immobilien, Wohnung, Wohnungen oder Haus suchen und finden. and there are two pages worth of one room appartments, and rooms available for less than 1000 CHF in Zurich.

Thanks for the info. My accountant's opinion seems to contradict yours (and those of other Brits working in Switzerland) substantially, particularly with regard to needing to work in Switzerland (with no work in the UK) for "six months and one day".

I don't understand the point you make about "no insurances to pay". They are deducted from Swiss salary (as well as the tax) before I see any money and I was told they were not refundable. What WAS refundable was that if I were prepared to pay above the minimum pension (eg pay an extra 1000CHF a month, with less immediately available to spend each month) that difference between the minimum pension and that extra I paid in could then be taken out as a lump sum (without paying the Swiss taxes on it) when I left the country.

There is another point made on the Swiss forums that was never made clear to me with the various options I was presented with, which is that tax payable is dependent on the area you live in. The Swiss agency were at great pains to dissuade me from taking out "serviced accommodation" in Zurich (saying they were "grim" and other contractors who'd gone that route hadn't lasted the duration). I'm now wondering if this was deliberate to try and "maximise" what looked like "take home" figures by assuming I would be living in one of the cheaper cantons outside Zurich, when the reality is I would have to live in the more expensive one (the self-serviced or cheap hotel option, which seems mainly to exist in the heart of Zurich itself), at least initially while looking for something better.

As already mentioned the end-client had already referred to a short term "cheap hotel" (CHF80/night) which subsequently turned out to be rather more than that and (more importantly) not have any vacancies anyway. I struggled to find anything at that rate when I travelled over for a couple of days (last week, admittedly at short notice) and it was explained to me that this was because of the time of year and is a situation likely to continue over the Summer months.

With so much contradictory advice it's hard to know what to believe, but my own experience seems to indicate you have been lucky with the sort of rates you're quoting and with finding accommodation at that price. On the Swiss English forums I've actually had a couple of PMs from people already in "one month's serviced accommodation" (or hotel) that was provided as part of their contract, contacting me asking for the name of the Swiss agency I'd referred to, hoping they might help them find something as they couldn't find anything themselves (they obviously didn't read the long, rambling post properly to discover that the Swiss Agency "help" amounted to nothing other than vague promises of assisting if I signed the contract with no real promise in writing).

With regard to homegate.ch (and the set of about five other "core" accommodation sites I've been given) your definition of "available" seems to differ from my experience. Trust me, I have a ton of "Sorry it's gone" responses (and even more lack of any kind of response at all) even where I've responded within hours of a post going up (something I'm unlikely to have the luxury of time to do once I'm working in a contract).

[IanSmithUK]

Maybe they could have practiced their skills on the preceding!

LOL! (Is that better?)

If you don't like someone's response, either pm a mod (or hit the abuse button), or add them to the ignore list. Don't start

hth

Easier to do once you're familiar with a place than when you've just made your first post in it. The MF=Switzerlanded explanation was helpful though thanks.

[DodgyAgent]

Why on earth did'nt you simply say that the rate was not high enough compared to what you were being offered elsewhere. It makes you look pretty stupid to have not done your homework on costs of living in Switzerland and I very much doubt that the client is in the slightest bit interested in the detailed account (Diatribe of whingeing) of why you were not getting the money that you were after. The fact that you do not understand why the client should be interested in your reasons is enough to cast doubt on your ability to make business focussed judgements whilst working.