Double taxation: one income, one tax
Many expats worry about paying taxes on their income in both Switzerland and their home country. This would create a double burden, but there is no need to worry. Switzerland has signed double taxation agreements (DTAs) with most countries to prevent this.
What exactly do double taxation agreements cover?
A DTA defines which country has the right to tax which type of income – for example:
- Salaries
- Pensions
- Dividends
- Interest
- Rental income
- Business profits
This ensures you do not pay tax twice on the same income. Instead, Switzerland either exempts the income or credits the tax already paid abroad.
What matters in practice
Switzerland applies the worldwide income principle. Even if some of your income is not directly taxed in Switzerland, it still affects the tax rate applied to the rest of your income. This is known as the "progression proviso": Your tax rate is determined based on your total income.
To ensure that the DTA rules are applied correctly, you must transparently declare all income and provide supporting documents, tax statements, or bank records from abroad.
Our team is familiar with country-specific differences and can help you take full advantage of your treaty while avoiding unnecessary double taxation.
More key information for expats
Residence & tax liability
Tax liability in Switzerland begins with residence or employment – the details are defined by your residency status.
Withholding tax
Withholding tax is convenient, but not always accurate – we help you review your situation and reclaim any overpaid amounts from the authorities.
Ordinary assessment
Voluntary filing allows for deductions that are not considered under withholding tax – often resulting in financial benefits.
International income
Anyone living in Switzerland must declare worldwide income – we support you with accurate reporting and correct tax classification.
Tax deductions
Expats who know and use available deductions pay less – our advice shows which options are worthwhile for tax purposes.
Assets & foreign accounts
In Switzerland, overseas bank accounts and foreign wealth must be reported – proper disclosure helps you avoid future disputes.
Spouse living abroad
If you live in Switzerland but your spouse resides abroad, your tax liability may change – we help with the correct classification.
Do you have any questions?
Having international income sources can create overlaps. Contact us if you would like a better understanding of your situation.