Updated : 12/2012
Income earned from self-employment includes business and professional income.
Costs directly related to business and professional income are deductible, e.g. all professional expenses, such as costs for material and goods, wages and social security expenses for employees, patent and licence fees, commercially justified write-downs, and all other expenses due to the business as well as adequate interest that would be paid on the own capital employed in the business in the amount of the nominal income. Certain personal deductions, e.g. for a child, for education of children, medical expenses, are allowed.
Income from self-employment is subject to social security contributions to old age, survivors’ and disability insurance, the family compensation fund as well as administration costs. The rate of the contributions is 11.6704 % of the gross income. A health insurance is mandatory for all residents. Furthermore, each self-employed person has to pay contributions to accident insurance and the occupational old age scheme.
Taxable income of a person subject to unlimited tax liability is subject to tax at a progressive rate (8-bracket schedule). The marginal rates, including the municipal surcharge, range from 3.5 % (for income exceeding the tax free allowance) to 28 %.
The schedules and tax free allowances differ for single taxpayers, single parents and jointly assessed married couples.
In case of limited tax liability, the tax rate is 4 %, including the municipal surcharge (simplified assessment), unless there is a regular assessment (see below). In a regular assessment the same tax rate applies as for taxpayers subject to unlimited tax liability.
Taxpayers subject to unlimited tax liability receive a tax return form and are requested to file it usually by the middle of April of the calendar year following the respective tax year. The wealth and income of husband and wife are aggregated for tax purposes. However, married couples may, upon joint application, be assessed separately. Taxpayers subject to limited tax liability have to get the tax return forms from the Fiscal Authority.
Taxpayers subject to limited tax liability also receive a tax return. For income of CHF 150,000 or less the taxpayer can choose between simplified and regular assessment. For income exceeding CHF 150,000 taxpayers have to file tax returns and are regularly assessed.
In the assessment, the Fiscal Authority specifies the tax assessment basis, the tax rate and the amount of tax due. The balance is payable within 30 days from receipt of the assessment. If the taxpayer leaves the country, the tax must be paid at the latest on the date of relocation.
If you disagree with your tax assessment, you can file a written appeal to the Fiscal Authority within 30 days from receipt of the assessment. If you disagree with the objection decision of the Fiscal Authority you may subsequently appeal to the National Tax Commission within 30 days of service of the objection decision. A decision of the National Tax Commission can be appealed to the Administrative Court within 30 days of service.
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