Switzerland - Individual - Taxes on personal income (2024)

All tax-resident individuals are taxed on their worldwide income and wealth. Non-tax-resident individuals are only taxed on Swiss sources of income and wealth.

Income taxes are levied at three different levels: at the federal level (which is the same all over Switzerland), at the cantonal level (which is the same within a certain canton and is based on the canton'sown tax law and tax rates), and at the municipal level (municipalities follow the cantonal tax law, butare entitledto set their own communal tax rate within certain parameters). Income tax rates are progressive at the federal level and in most of the cantons. Some cantons have recently introduced flat rate taxation.

All income is taxed on the basis of the same tax return with generally the same tax rate (i.e. all income sources are added together), and from such total income all applicable deductions are subtracted. This results in an applicable tax rate that is levied on all taxable income. Based on applicable DTTs, the actual taxable income in Switzerland may differ from the tax rate determining income. Furthermore, dividend income from substantial participations may be taxed at a lower tax rate based on domestic federal and cantonal law.

Personal income tax rates

Direct federal tax on income (for 2023)

I- Single taxpayers

* Swiss francs

For taxable income above CHF 769,700 the overall tax rate will be 11.5%.

II- Married taxpayers and single taxpayers with minor children

For taxable income above CHF 912,600 the overall tax rate will be 11.5%.

Zurich cantonal tax (basic tax)

III- Single taxpayers (income taxes)

IV- Married taxpayers and single taxpayers with minor children (income taxes)

V- Calculation of effective taxes

For Zurich cantonal taxes, the above rates can be applied directly. For the additional municipal taxes, the above rate has to be multiplied by the respective municipal tax factor, which varies between 0.72 and 1.30 (City of Zurich: 1.19). For church tax the basic tax above is multiplied by the church tax factor, which is between 0.06 and 0.15.

Geneva cantonal tax (basic tax)

The Geneva tax table is quite complex as it does not apply a tax bracket system. The tax rates are increasing continuously in small increments with each increase in income. The table below therefore only provides a general overview (for 2022).

The tax rate applicable to a married couple or individuals in a Swiss registered partnership is the rate applicable to 50% of their combined income (so-called 'splitting'). The tax rate applicable to single, widowed, divorced, or separated individuals living with a dependant (child or adult) is the rate applicable to 50% of the income.

The above tax rates are basically applicable to taxpayers filing a tax return. Effective cantonal income and wealth tax is determined by multiplying the basic tax by the multiplier applicable for the tax (calendar) year in question, and then by adding the supplementary tax on wealth.

Local income taxes

Geneva communal tax

Each commune of the canton of Geneva determines the multiplier applied on the cantonal tax rate and hence its communal tax rate autonomously depending on its financial needs. As result, the communal taxes can vary significantly. The communal taxes are, as mentioned above,a percentage of the cantonal taxes, and are levied in conjunction with the cantonal taxes. For example, the effective communal tax of the city of Geneva is 45.5% of basic cantonal tax. The highest communal tax rate is 51% of the basic cantonal tax and is levied in the communes of Chancy and Avully. On the contrary, the lowest communal tax rate is applicable in the communes of Genthod (25%), Cologny (27%), and Collonge-Bellerive (29%).

Withholding requirements for sales of property, dividends, interest and royalties

In general, interest and dividend income derived from Swiss sources is subject to a 35% withholding tax (WHT), whichtax has to be withheld from the paying party (e.g. bank or Swiss company) and is directly deducted from the gross amount paid to the recipient. Based on the facts and circ*mstances, this tax may be credited towards the overall income tax liability in Switzerland or may be refunded.

On payments received for loans secured by a property located in Switzerland (without repayment amounts, e.g. mainly mortgage interest) a tax at source may be due if the creditor (individual or legal entity) is domiciled abroad. Tax at source has to be withheld by the payer of the interest. Applicable DTTs may cap or abolish the applicable cantonal tax rates.