The apartment in France will be rented out during the year.
I want to buy an apartment in the south of France, and was wondering, should I pay some kind of taxes in Switzerland? I'm an EU citizen and hold a B permit.
Income from real estate is taxed in the country where the property is located. In your case France. Switzerland will not tax you, but they will add the income to your income in order to establish the rate of tax you will pay on your income.
The French will do the same. I give an example.
If your Swiss income is CHF 100,000 and your tax rate (all hypothetical) is 30% and the French net income is CHF 10,000 and an income in Switzerland of CHF 110,000 is taxed at 35%, you will pay CHF 35,000 rather than CHF 30,000. You won't pay tax on the CHF 10,000
The French will make a similar calculation.
It might be better to own the property through a company where the corporation tax would be 26.5% You can also make more deductions than you can as an individual.
Calculate carefully and take tax advice.
Does the same applied to the property tax itself (wealth tax) for a foreign property?
Also, out of curiosity: does it mean that using progressive buckets the total tax % is calculated and then it is used on the taxable amount?
For example: Swiss income 100k, foreign income 50k. Let's say that income tax brackets are 10% until 100k and 40% for more than 100k
Does this mean that the calculations go as follows:
total tax on 150k is 100*0.1 + 50*0.4 = 30k, that means 20% total of tax on the income
So then 20% is kept, but taxable income is 100k, so you end up paying 20k in taxes?
Yes, the property would also be added to your wealth for WT purposes.
The foreign real estate income is used to determine the rate of tax (percentage) you will pay on your Swiss income.