The respective cantonal tax office is responsible for taxes. As is true for many areas in Switzerland, the taxation of employees varies from canton to canton.
Regulations are similar in other cantons so this provides you with an initial overview of the system. Switzerland taxes both income and capital. The cantons of St. Gallen and Grisons provide an online tax calculator which allows you to estimate your probable tax liability and to calculate the different tax rates between municipalities.
You can obtain detailed information from your tax advisor in accordance with the integration agreement.
The taxation of income in Switzerland is regulated differently. The information below covers the most important variants:
Whereas the Swiss pay their estimated tax once a year in advance and then have to pay the final tax bill at the end of the year (other payment variations exist and must be clarified with the responsible tax office), all foreign workers (not possessing a permanent residence “C” permit) pay withholding tax (QST), i.e. this tax is deducted directly from the salary each month by the employer. This only applies to Swiss employers, e.g. HIBAG. The withholding or at source tax is therefore not collected from the employee as the recipient of the taxable salary, but from the employer as the debtor of the tax burden. The employer must immediately deduct the tax payable from the salary and pay it to the tax authority.
An "ordinary assessment", i.e. an income tax declaration/return, must be submitted however, by every employee who earns more than CHF 120,000 a year.
Employees who are subject to withholding tax are requested each year by the cantonal tax office to declare any other income and assets (e.g. bank accounts, securities and automobiles) annually. The tax form for this purpose is mailed to those concerned but it may also be completed online.
Certain expenses are deductible items and may reduce the paid withholding tax. For this purpose, you must also complete a tax form. The following are deductible, for example: debt interest, pension contributions to pillar 3A, medical costs, donations, maintenance payments and child allowance adjustments. It should be noted that these deductions can only be made until the end of March of the following year.
If the respective tax form is not sent to you in good time, you must
request it from the cantonal tax office.
Cross-border commuters from Austria pay the normal withholding tax rate in Switzerland according to Canton St. Gallen. This will be deducted directly from the salary. The tariff classification is based on civil status, religious denomination and number of children.
Cross-border commuters from Germany pay a reduced withholding tax rate in Switzerland. Fundamentally, they have unlimited tax liability in their country of residence. The commuter taxes paid in Switzerland are essentially taken into account. Every year a residence certificate from the municipality of residence in Germany must be sent to the withholding tax office in St. Gallen.
Also, in this case it is highly recommended that you obtain advice from a tax adviser.
Cross-border commuters with place of residence in Switzerland and place of work in Liechtenstein (HAG)
In the Principality of Liechtenstein, no taxes have to be paid. From the Swiss place of residence, a certificate of residency must be submitted to the employer in Liechtenstein.
Taxes are not deducted directly from the salary, but estimated each year on the basis of the current income.
The tax authority responsible automatically mails the respective tax estimate together with a request for payment and payment slips. An income tax declaration has to be completed the following year.
In addition to state and municipality taxes, there is also the federal direct tax as well as church tax. The deadline for paying this tax can be found on the invoice.
If someone lives in Switzerland during the week, but his/her main interest is, for example, in Germany because their family lives there, there is no commitment in Liechtenstein to pay withholding tax for the main country of residence. Fundamentally, anyone who does not receive a certificate of residency from the municipality for the address in Switzerland is subject to withholding tax in Liechtenstein.
The cross-border commuter status for Switzerland only applies with a certificate of residency in Switzerland.
It is highly recommended in this case that you consult a tax adviser in advance.
In accordance with your integration agreement, you are entitled to tax advice.
Every year you have the opportunity, through the Hilti benefit portal, to take advantage of a voucher for a tax consultation with tax consultants commissioned by Hilti. Additional hours will be charged to you directly by the tax consultant.