Tax at Source with Irregular salary

Finance, Taxes, Banking, Insurance and Retirement
1
Hello Forum members,

I am curious about how tax is deducted at the source.

At Zh.ch, It's mentioned that tax is calculated on monthly salary

For example:

assume my annual contract is 1,00,000 CHF ( fixed ) split into 12 parts

I get an irregular salary but still less than 1,20,000 CHF

Feb : 10,000 chf

March : 7000 chf

April : 8500 chf

How my employer will calculate each month's taxes? Also, the annual contract is 1,00,000 but I will get paid only for 11 months (Feb- Dec)so taxable income should be lower?

I didn't get how yearly tax percentage is applied to a monthly salary

Any input is appreciated

2
Tax at source is applied at monthly salary. As well as all tax rates are set for monthly payments.

3
Where I can see monthly rates for federal, cantonal & commune tax?

4
The monthly tax rate is based on the projected annual salary.

Tom

5
I am so stupid to understand the taxing system

Annual projection salary 1,00,000

https://taxsummaries.pwc.com/switzer...ersonal-income

1,428.60/12 = 119.05 per month Federal tax ?

3866/12 = 322 per month Cantonanl tax ?

6
If you get 10'000.- CHF in a month, then the annualized salary for that month is 10'000.- * 12 = 120'000,- CHF, you will be taxed at the rate for 120'000.

If your annualized salary exceed 120'000 at the end of the year,- you will need to do a retroactive normal tax return, at that point you will be able to get back any excess in tax you have paid from source, or pay more if you paid less.

7
You send them a letter when the year is over and ask them to adjust.

8
ah, projection on each month's salary. It's a disadvantage

I will work only 11 months this year so projection = month * 11?

9
As far as I remember from my B-permit times, tax at source effective percentage was always deducted based on "Quellensteuer Tarife" of tax authority. Every quarter, when sales commission was paid out, my tax at source line on payslip had higher percentage.

It should be still the same (at least in ZH) according to this:

https://www.zh.ch/de/steuern-finanze...ml#-2056028775

10
x 12.

Tom

11
Now, It's clear.

Only one last thing, I am sure I will pay more taxes but my yearly salary will be less than 1,20,000 CHF

can I still file an income tax return and ask for a refund?

12
How a refund?

Tom

13
You can volunteer and send a tax return, you get back overpaid tax, but then you will be required to submit a tax return every year, even if you are less then 120k CHF

14
And if you live in a part of the canton with higher than average Gemeinde taxes e.g. Zurich City you could actually end up owing more.

15
Also, if you have lived here only 11 months, then your 11 months of salary will be pro-rated my multiplying by 12/11 to get your yearly tax rate.

Tom

16

oops, I thought It will be just 11 months. It's clear now

Thanks to all !!

One more thing

How benefits are taxed? I will get 2 months of temporary accommodation. It's written in the contract that all benefits are under Swiss tax

If I am staying in an apartment of 3000 CHF per month sponsored by an employer for 2 months

how much tax do I have to pay for this benefit? Will 3000 CHF be directly be added to my monthly salary amount?

17
Added to your salary and taxed.

18
Is it worth declaring taxes if you only lived 4 months in Switzerland last year? I paid half of my taxes in Basel with very high taxes and 2 in Schwyz. But my tax at source rate even in Schwyz seems to be higher than my Gemeinde rates when I do a tax calculation (based on an estimated yearly income).

19
Should not you then get a refund? This is what I do not get about the system.

Let's say I have worked for 1 month in a year and earned 10k in that month. For the tax purposes, this is annualized to 10x12 = 120,000. So, the Tax bracket falls into that of 120k per annum. But if I have worked only for 1 month in the year with the actual income of 10k per annum, how come are you not due a refund?

20
How long did you live here?

12 months, refund, 1 month, no.

Tom