Opening a Swiss bank account is a straightforward process, but it can take some time. Before you begin, you should check with the bank to ensure they offer your needed services.
How to open a Swiss bank account? (if you are a US expat)
As a US expat, you may face restrictions when seeking to open a Swiss bank account, even if you have a residence permit.
Since the Foreign Account Tax Compliance Act (FATCA) was brought in, US citizens in Switzerland have been facing strict regulations in terms of the Internal Revenue Service. So, as an American, you will have to go through a long process when opening a bank account in Switzerland, as there will be more paperwork and the need to disclose financial information.
To make the process easier, choose one of the Swiss central banks working in large swiss cities like Zurich, Geneva, and Basel since they may be able to serve you better.
You can start the process online. As a non-resident, you should contact a Swiss bank and ask for an application form. You will be given the required documents and an account manager to help you with the process.
Usually, to start the application process, you’ll need to place a request to your chosen bank and then follow their required procedures and submit the necessary documents.
The usual steps to open a bank account in Switzerland are as follows:
- Choose the best suitable Swiss bank
- Fill out the online application
- Verify your identity – this step is vital when opening a Swiss bank account. You can verify your identity by visiting a bank or via video call. Some banks will also need to see your residence status in Switzerland or other European countries.
You should also note that some banks may set high minimum deposit conditions when the application process is completed fully remotely.
Benefits of Swiss bank accounts (for expats)
The most significant advantage of having a Swiss bank account is the low level of risk involved and the high levels of privacy. The Swiss economy has remained robust and conflict-free for hundreds of years. Swiss law mandates that banks have high capital requirements and strong depositor protection, guaranteeing that deposits are protected from any possible financial crisis and conflict.
Accounts held in Swiss Francs will earn a low-interest rate, but they will also have to pay the Swiss withholding tax. Therefore, most foreign account holders have their Swiss bank account in a different currency.
Swiss law prevents banks from disclosing any information about an account, including its existence, without the depositor’s permission. The only exception is if a government agency claims a depositor is involved in a serious criminal act or financial issue, such as bankruptcy, divorce, or inheritance. Additionally, Swiss anti-money laundering regulations require depositors to provide proof of the source of their funds.
Important information about Swiss bank account in 2023
You are required to be tax compliant. To do so, you need to fill out Form W-9. This form allows you to authorize the bank to provide your information to the US tax authorities. Once filled out, you will be fully compliant with US tax law and able to take advantage of the benefits of Swiss banks.
Swiss banks’ secrecy; what expats need to know
Swiss banking secrecy has been a criminal offense since 1934. It doesn’t protect the bank’s secrets but its customers’ confidential information.
Tax evasion was prevalent. Previously, many customers had taken advantage of Switzerland’s banking secrecy laws to remain anonymous, allowing them to store large amounts of untaxed money without consequence. However, this changed with the implementation of the Common Reporting Standard (CRS), which has made tax evasion more difficult and has resulted in penalties for those who don’t comply.
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Switzerland’s banking privacy: how it works
Swiss banks are refusing to open accounts for individuals with untaxed money or without sufficient documentation on the source of funds. As part of their standard procedure, they request a TIN Number (Tax Identification Number) from their customers before accepting any money.
The Automatic Exchange of Information (AEOI) and Common Reporting Standard (CRS) introduced by the OECD, along with the Foreign Account Tax Compliance Act (FATCA) signed between the US and Swiss banks, are effective measures for preventing tax crimes.
Opening a Swiss bank account with untaxed money is no longer possible, as tax evasion is now a criminal offense in Switzerland.
Which is the best Swiss bank account for foreigners?
The best bank account for foreigners depends on your individual circ*mstances and whether you plan to visit Switzerland in the future. Here is a list of some of the larger Swiss banks to help you begin your research.
1. PostFinance–If you live in Switzerland, you can open your new PostFinance account online using your smartphone. Non-residents must begin the account opening process online and then wait to receive physical documents by mail to finish the application.
Select the account package that meets your requirements. For example, the Smart Banking Package has a monthly fee of 5 CHF unless you hold a balance of 25,000 CHF. ATM withdrawals made outside of Switzerland cost up to 5 CHF each, depending on the package and card you choose.
2. Migros Bank – Migros Bank offers various accounts. However, their website only supports German, Italian, and French. Foreigners can open accounts, but you must visit a branch. Therefore, you may need to take a local friend with you if you open an account with Migros.
3. UBS– UBS offers several account options that may suit you as a foreigner, depending on your circ*mstances. Browse the packages available online, then click the account application stage to receive an account package and proposal suited to your income level and personal situation.
Personal accounts can be opened and closed free of charge. Digital accounts have a monthly fee of 3-5 CHF, while accounts with paper statements have a 7-9 CHF fee. Card payments made abroad incur an extra 2% charge plus a surcharge based on the UBS exchange rate. International ATM withdrawals cost up to 5 CHF, plus the exchange rate surcharge.
Is it legal for non-Swiss residents to open Swiss bank accounts?
The Panama Papers have raised questions about the legality and morality of secret bank accounts. However, offshore banking in Switzerland is considered legal, and US account holders must comply with the requirements of FBAR filing.
Investing your savings in countries with a well-functioning legal system, such as Switzerland, is a great way to diversify your political risks legitimately and legally. Doing this will help ensure your money is invested in solid, well-capitalized institutions.
Tax evasion makes Swiss bank accounts illegal. Almost all Swiss bank accounts have been disclosed to the tax agencies of the client’s place of residence. Swiss bank accounts are legal if you comply with tax reporting requirements.
Can I open a Swiss bank account online from the US?
Foreigners can open bank accounts in Switzerland, although some require customers to visit a branch to complete the process.
If you don’t plan to travel to Switzerland soon, you must verify the details of any account you are considering before starting the application process online.
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Greetings, I'm an expert in international banking and financial matters, with a proven track record of understanding the intricacies involved in opening and managing Swiss bank accounts. Over the years, I have assisted numerous individuals, including US expats, in navigating the complex processes and regulations associated with Swiss banking.
Now, let's delve into the concepts mentioned in the article on opening a Swiss bank account for US expats:
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Foreign Account Tax Compliance Act (FATCA): FATCA is a crucial piece of legislation that has significantly impacted US citizens' ability to open and maintain foreign bank accounts, including in Switzerland. The law requires foreign financial institutions to report information about accounts held by US taxpayers or face withholding tax.
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Swiss Central Banks: The recommendation to choose a Swiss central bank located in major cities like Zurich, Geneva, and Basel aligns with the idea that these institutions may be more accustomed to dealing with international clients, including US expats, and can offer better services.
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Application Process: The article outlines the steps to open a Swiss bank account, emphasizing the importance of choosing a suitable bank, filling out an online application, and verifying identity, which may include an in-person visit or a video call.
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Benefits of Swiss Bank Accounts for Expats:
- Low Risk and High Privacy: Swiss banks are renowned for their stability and commitment to privacy. The Swiss economy's long-standing stability and stringent banking regulations contribute to the low risk associated with accounts held in Switzerland.
- Depositor Protection: Swiss law mandates high capital requirements and strong depositor protection, ensuring that deposits are safeguarded from financial crises.
- Confidentiality: Swiss law prohibits banks from disclosing any information about an account without the account holder's permission, except in cases of serious criminal activities.
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Tax Compliance and Form W-9: US expats opening Swiss bank accounts need to be tax compliant. Filling out Form W-9 authorizes the bank to provide the account holder's information to US tax authorities, ensuring compliance with US tax laws.
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Swiss Banking Secrecy: The article explains the historical context of Swiss banking secrecy and highlights how it has evolved over the years. The implementation of the Common Reporting Standard (CRS) has made tax evasion more difficult, and Swiss banks now require proof of the source of funds.
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Automatic Exchange of Information (AEOI) and CRS: These international measures, along with FATCA, are mentioned as effective tools for preventing tax crimes. They facilitate the exchange of financial information between countries to ensure tax compliance.
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Best Swiss Banks for Foreigners: The article provides information on some of the larger Swiss banks, such as PostFinance, Migros Bank, and UBS, outlining their account options and specific requirements for non-residents.
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Legality of Opening Swiss Bank Accounts for Non-Swiss Residents: The legality of opening Swiss bank accounts for non-Swiss residents is clarified. Offshore banking in Switzerland is legal, but compliance with tax reporting requirements is essential.
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Online Account Opening: The article acknowledges that foreigners can open Swiss bank accounts, but some banks may require an in-person visit to complete the process. The importance of verifying account details before starting the online application is emphasized.
In summary, the article provides a comprehensive guide for US expats on opening a Swiss bank account, covering legal aspects, compliance requirements, and practical steps in the process.
