Tax optimization: How to save taxes legally
Through targeted tax optimization, you can legally save significant amounts every year — often more easily than you might think. On this page, we will show you the most important ways to reduce your tax burden and explain when it is worthwhile to seek professional advice.
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What is tax optimization?
Tax optimization involves the strategic use of legal options to minimize your tax liability. The objective is to minimize taxable income so that only the necessary amount is taxed, while operating within the confines of the law.
In Switzerland, there are many ways to optimize taxes, including deductions for Pillar 3a, medical expenses, interest payments, donations, and alimony. The timing of certain expenses also plays an important role. By carefully planning investments or pension contributions, you can save on taxes, depending on your canton of residence and income level.
Note that tax optimization is not tax evasion; it is informed and strategic planning. The sooner you start managing your tax situation, the greater your potential savings.
Three tips for your tax optimization
Tip 1: Make contributions to Pillar 3a
One of the easiest and most effective ways to save on taxes in Switzerland is to pay into Pillar 3a. Your contributions are fully deductible from your taxable income, up to the yearly maximum. Depending on your income and canton, you could save hundreds or even thousands of francs each year. Pillar 3a is particularly appealing to employees with full pension coverage and self-employed professionals without a pension fund.
Tip 2: Record all deductions correctly
Many taxpayers lose money because they do not claim important deductions correctly or in full. These include work-related expenses such as commuting costs, meal expenses, and work clothing; premiums for health and life insurance; education costs; donations; and alimony payments. It is especially important to review all relevant deductions carefully during life changes, such as marriage, the birth of a child, or a job change. Tip: Keep your receipts well organized.
Tip 3: Make use of property maintenance costs
If you own a property, you can deduct maintenance costs, especially those that preserve the property's value, such as painting, heating, renovations, and repairs. Be sure to claim these expenses in the correct tax year. Large renovations can be spread across several years, so it's wise to compare lump-sum and actual deductions. Our specialists can help you decide which is best for your situation.
Looking for more tax-saving tips?
Do you want to fine-tune your tax return? Check out our Useful Resources page for free downloads, including tax-saving tips, handy checklists, guides, and easy-to-use overviews. They're ideal if you want to take control of your tax planning.
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