Reply to: Contracting in Switzerland - Let the Naive Beware!

[SueEllen]

Quite frankly, the research required isn't something that can be undertaken just on the promise that one MIGHT get an interview. Far too much of it depends on taxation, which appears to be tied to the canton you live in, which can't be determined until you've got accommodation sorted. Knowledge of that requires knowledge of the local market and all takes significant time (especially when you don't speak German).

Like others I found it odd that having worked in different countries one of the first things you didn't check out whether you could use your limited company and an indication of the personal tax rate.

It would take an hour maximum.

And even less time if you used the search facility on here.

Switzerland is one place you won't have trouble finding information about due to the many posters who have worked there.

As a contractor one of your skills should be to be able to find out information quickly.

[BlasterBates]

Having worked in Switzerland for several I don't agree at all that that it's difficult. UK contractors come over all the time.

At the moment it's hey ring a ding so finding a flat has obviously got a lot harder than it was just a few years ago, when it was very easy. But yes you'll need a hotel from day 1, and then find a flat from there, cost 80 CHF a night.

As far as tax and deductibles it compares very favourably especially if you stay those 183 days that the double taxation treaty stipulates and when you are definitely exempt from UK tax. If you really do have a contract shorter than 6 months I disagree about not being exempt from Insurance. If this is a short period I can't imagine that you can't opt for UK National Insurance, but that would mean work for the agency and/or payroll and they probably didn't do that. There is a different tax status for short-term stayers (90 days), and if you can actually prove your residency in the UK surely this would be decsive factor in exempting yourself. I've never heard of any contractor that was less than 6 months so I wouldn't know. I once did a 3 monther in Luxembourg and because I was there 3 months I was exempted Insurances due to the short period. The payroll company didn't really tell me I would be exempted they gave the usual bumf about my net. When I renewed in the new tax year they all kicked in.

[Wanderer]

IAnd 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.

I would have thought that someone like yourself who had worked in a number of countries would be pretty steetwise but to be honest, you come across as a bit of a whiner. I was a little puzzled as to how your Swiss experience sat so much differently to that of other countries. For example:

1.The higher tax (due to not being able to use my own company as in the past without a deposit of 10,000CHF, which I am not prepared to do)

How did you trade in Saudi, Kuwait, Germany, Ireland and USA? Did you use your own company in all of these jurisdictions? I would have thought that they would all be quite different and certainly the tax regimes differ a lot from the very limited amount I know of them. Knowing what your net income has got to be a major part of making the business case for taking on a contract in another country.

2.The compulsory insurances deducted from salary which the UK tax man doesn’t recognise as being eligible towards UK tax

Once again, did this not happen in other countries? For example, how did you get on in the USA where I understand that medical insurance is pretty much compulsory?

3.The high cost of accommodation and living expenses

Maybe it caught you by surprise but I thought it was well known that Switzerland was expensive. Of course, expensive is relative to where you live but there are guides you can get on the net which compare the relative cost of living between your current home city and your target city.

4.The risk of being charged an additional 15% UK tax (on top of the Swiss 25% rate) if I return to the UK in less than“six months and 1 day”

I've never worked in other countries but I understand what a reciprocal tax agreement and non-resident for tax purposes is and I even have a vague idea that there is a magic number at around 183 days (no doubt plus other restrictions) that you have comply with before you become non resident for tax. Did this come as a surprise to you? Surely Saudi would have had a lower tax regime than the UK so you would have been well aware of your resident/non-resident tax status.

5.Terms and conditions which could mean that if I am “let go” within 20 working days I will not be paid for those days

I don''t see that this is anything to do with Switzerland - it's typical agency contract bulltulip. You just tell the agency you aren't having stupid clauses like that in your contract thank you very much. That's a standard part of contract negotiation. But of course you know that already.

6.The high probability that the exchange rate will deteriorate when UK base rates rise in September (as hinted at by the Bank of England), thus making it harder to cover my UK commitments.

And this risk was never a consideration when you were presumably earning/spending Euros/Dollars/Riyals on other contracts? If you have substantial amounts of money to transfer then you could set up a Euro/CHF/GBP account and move your money between them depending on which way you think the market is going.

[DodgyAgent]

Edited to add: Is it just me who finds it funny that someone calling themselves "DodgyAgent" is giving me advice on "business focussed judgements"?

Life is just one long irony

[nomadd]

...in response to my just trying to warn others of some pitfalls when considering this sort of left-field offer that an agency might throw at you I really wonder why I wasted my time in posting here to "warn" others. My bad!

Not really wasting your time. I quite enjoyed your post. As for the trolls/nutters/etc. on here, as one of the mods has suggested, set-up an ignore list. Mine is very long.

EDIT: Just to make it clear, though, I don't think you needed such a letter. A quick phone call to the agent - not client - would have sufficed.

[stek]

Ian. Ignoring your continuing annoyance at me, I'm interested in how you approached working in the US, Saudi etc. Was this through your Ltd company? Did the client pay expenses etc

You've obviously worked in far reaching locations?

I think what this thread shows/merits is that it would be interesting from a CUK perspective to have a 'Contracting Abroad' FAQ and document the differences, possible catch outs, need to knows etc associated with different countries. That would be a pretty useful thread.

Agree with MF, CH isn't THAT hard to work out. Consider also that after a suitable period you'd qualify for RAV.

If you don't know what that is, you should read more.

[MarillionFan]

Ian. Ignoring your continuing annoyance at me, I'm interested in how you approached working in the US, Saudi etc. Was this through your Ltd company? Did the client pay expenses etc

You've obviously worked in far reaching locations?

I think what this thread shows/merits is that it would be interesting from a CUK perspective to have a 'Contracting Abroad' FAQ and document the differences, possible catch outs, need to knows etc associated with different countries. That would be a pretty useful thread.

[IanSmithUK]

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.

I did quite early on. But if I'd added all the detail about the to-and-fro of discovering each new cost (insurance deductions, canton differences, reality of accommodation costs, and most importantly of all "Food food food") and the subsequent changes to the offer made that would have added even more detail. And that was discussion between myself and the agent not myself and the client.

Make your mind up. I either provide all the detail or I provide none. What I attempted to do (and clearly failed at, although to read some here Moses could come down from the mountain and it still wouldn't be good enough) was to provide enough "detail" to warn others of the main issues.

Honestly the "holier than thou" attitude here is astonishing. I didn't provide enough detail of the whole process. I provided too much. I give up!

Edited to add: Is it just me who finds it funny that someone calling themselves "DodgyAgent" is giving me advice on "business focussed judgements"?

[IanSmithUK]

You obviously haven't posted on enough different types of internet forums. Compared to Mumsnet we are pussy cats.

Actually it is. If you are intelligent enough to be able to sort out your personal tax affairs in those other countries how come you didn't research personal taxation in Switzerland before having the interview?

If MF (the only person who was posting on here for the first couple of days of replies) is a "pussycat", then he's a leopard! But thanks for the warning about mumsnet. I'll make sure I steer well clear.

I think there is plenty of evidence even on this thread that the rules are complex and every person you ask has a different answer. My accountant was my first port of call but it's unfair to expect him to be an expert on Swiss tax and canton law when even those working in the country are struggling to understand the subtleties of the different canton rules, which appear to be based on where you're going to be living (anybody see a Catch 22 here, given the difficulty of sorting out accommodation).

Specifics on the crucial stuff (the cost of "Food, food and food", as one contractor already out there put it to me) is pretty hard to find, and was probably the most enlightening part of my trip out there to try and find out the reality of costs, accommodation availability etc.

You ask "Why didn't I research personal taxation before having the interview?" Uk agencies ALL deluge you with crazy possible offers, tell you the contract's pretty much yours, your CV is excellent etc and can they arrange an interview... only for you to then never hear a word back (the ones who insist they're "different" and will always keep you fully informed are always by far the worst at ever giving you any feedback at all once they've grabbed your CV to get names of companies to then hassle for possible work). If I did the research for every role I was asked "Would you be interested in....?" to the level some here appear to expect as the absolute minumum I'd never have any free time again, or the time to actually do any real work.

In this case I was asked if I'd consider working in Switzerland and I said "yes" based on the very basic facts put in front of me at the time. I was somewhat surprised when unlike most other agency enquiries, interviews were set up almost immediately. Those interviews were extremly time-boxed and geared very much towards the client getting what they needed to know about me out of the process, with no time for me to "turn the tables" (until I flew out to Zurich and effectively demanded reciprocation by saying "I'm here at great expense. Give me an hour of your time").

Quite frankly, the research required isn't something that can be undertaken just on the promise that one MIGHT get an interview. Far too much of it depends on taxation, which appears to be tied to the canton you live in, which can't be determined until you've got accommodation sorted. Knowledge of that requires knowledge of the local market and all takes significant time (especially when you don't speak German).

Honestly, there are so many "holier than thou" types spouting "You should have done the research" or "You should have done this or that" in response to my just trying to warn others of some pitfalls when considering this sort of left-field offer that an agency might throw at you I really wonder why I wasted my time in posting here to "warn" others. My bad!

The idea that clowns like MF are more "professional" than me I find laughable. Any idiot can endlessly troll newcomers or sit in the corner going "You're an idiot and I'm not" (like kids in a schoolyard going "My dad's bigger than your dad. Nyaaa nyaa". That approach says EVERYTHING I need to know about THEIR level of professionalism!

[stek]

I've not had nearly as many problems in Switzerland. I think the most frustrating part of it was no one seems to be clear on the rules since they change each year as the Swiss slowly come into line with EU migration regulations.

For NI, all I had to do was fill out a form to HMRC and they confirmed I'm eligible to pay NI only in the UK. I gave that to the Swiss agents and that meant I no longer had to have NI deductions.

Also, you can work a certain period without having to pay any taxes in Switzerland, only in the UK.

Again, its hard to get the right information and it varies by canton which doesn't help.

Hope you have better luck on your next gig.

Agreed, and it's always helpful to be able to speak German, or preferably that unintelligible babble called Swiss-German, spent ages in a Zurich restaurant asking for Hähnchen (chicken), only eventually for the lass to say, oh you mean Poulet?

[JaredM]

I've not had nearly as many problems in Switzerland. I think the most frustrating part of it was no one seems to be clear on the rules since they change each year as the Swiss slowly come into line with EU migration regulations.

For NI, all I had to do was fill out a form to HMRC and they confirmed I'm eligible to pay NI only in the UK. I gave that to the Swiss agents and that meant I no longer had to have NI deductions.

Also, you can work a certain period without having to pay any taxes in Switzerland, only in the UK.

Again, its hard to get the right information and it varies by canton which doesn't help.

Hope you have better luck on your next gig.

[SueEllen]

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".

You obviously haven't posted on enough different types of internet forums. Compared to Mumsnet we are pussy cats.

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.

Actually it is. If you are intelligent enough to be able to sort out your personal tax affairs in those other countries how come you didn't research personal taxation in Switzerland before having the interview?

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.

I one of the people who if she gets pissed off with companies will write a complaint letter.

Experience (ok after my third complaint years ago) has taught me if you don't want your words deliberately misinterpreted you need to write your complaint to be as short and concise as possible.

Your long complaint allows the agent wiggle room with the client, and to turn around and say I did x and y but obviously he didn't understand it and is disorganised.

[xchaotic]

@IanSmithUK: I think with the blessing of Internet, it is possible to do some research without actually going to a place.
My diagnosis is that Switzerland has got nothing to do with it, you'd be best off working on a high salary as a permanent employee, or working through an umbrella as your personality is not very keen on taking the additional risks/complexities that are associated with running your own business in addition to performing your work duties.
The fact that only a small percentage of workforce are contractors and majority are permies says that there's nothing wrong with you, you're just normal (but probably better off mentally staying away from uncertainty of contracting)

[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.

[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.