The tax return is a must in Switzerland year after year. Every adult resident in Switzerland is required to file a tax return. It is a vexed subject, but it can also be useful, as you can get money back. You can do this if you deduct various expenses for tax purposes. It is important that you know what you can claim for tax purposes and up to what amount this is possible. In the individual cantons, the regulations may differ in detail. This also applies if you submit the tax return online.
Insurance premiums tax deductible
Insurance is useful because it protects against high costs in the event of damage. You can declare various insurance premiums on your tax return. However, this is not possible with all insurances.
Tax deduction for health insurance and medical treatment
Nothing works without health insurance. Therefore, you can also deduct the insurance premiums for tax purposes. A tax claim for health insurance contributions is possible after deducting the premium reduction and any reimbursements.
Not all costs are covered by your health insurance. Treatments or remedies that do not comply with the insurance conditions will not be reimbursed to you by the health insurance company. This also applies if you have a high health insurance deductible. The costs that you had to pay yourself are reported in your tax return. However, it is important that the treatments or remedies are medically recognized. Otherwise, they cannot be deducted for tax purposes. You cannot include cosmetically based treatments on your tax return. Also deductible are the cost of eyeglasses, contact lenses, dentures, dentists and licensed natural healers.
Be aware of the health insurance deductible. It is high in many cases, so you can only deduct for tax purposes the costs you pay that exceed the deductible. The deductible in most cantons is five percent of your net income. There is no deductible in the canton of Baselland. You can claim the entire cost there for tax purposes. The deductible in the canton of Schwyz is less than three percent. In the cantons of Valais, Glarus and St. Gallen, the deductible is two percent of your net income.
What you should bear in mind when making private provision
You can also deduct contributions for accident insurance, life insurance and pension funds for tax purposes, as they are considered private pension provision.
If you are self-employed, you can pay into pillar 3a as a tied pension plan and deduct up to 20 percent of your net income for tax purposes. Note the maximum amount, which is quite low even if the contributions were paid into the pension fund through the employer. For other contributors, the maximum amount is higher. Here, too, there are differences between the individual cantons. In order to be able to declare your contributions on your tax return, you will need confirmation from the institution where you make your deposits.
To prevent your AHV pension from being reduced, you can pay any missing AHV contributions in arrears. There are several reasons for gaps in contributions:
- frequent change of employer
- Study
- longer stay abroad
- Receipt of daily allowance benefits from an insurance company due to illness or accident
You can make back payments for a period of up to five years and report them on your tax return. You are required to provide proof if your employer has withheld money from you for AHV contributions but has not paid it in. You will be credited for the missing contributions if you can prove that you worked during that time.
If you buy into a pension fund, these costs are also tax deductible. The amount you can purchase depends on your coverage gap. Note whether an insurance allowance per child applies in your canton. With such allowances you can save additional taxes.
Caution: You cannot deduct these insurance premiums for tax purposes
Not all insurance premiums are tax deductible. This concerns
- Liability insurance
- Home insurance
- Car insurance
- Property insurance
- Travel insurance
Professional expenses tax deductible
In order for you to practice your profession, various costs are sometimes incurred. These can be costs for commuting to work, various work equipment that you pay for yourself, but also costs for further training. Various professional expenses are tax deductible.
Tax deductible costs for further education
What you can deduct for tax purposes in terms of continuing education costs varies from canton to canton. You can only include continuing education costs on your tax return if they are not costs for primary initial education. In most cases, tax administrations require receipts for continuing education expenses. Without proof, costs up to CHF 500 are deductible in the canton of Zurich and some other cantons.
In order to be able to deduct costs for further education for tax purposes, you must be in professional life. If you take a sabbatical and complete education or training, the costs are not deductible. The education or training must be related to the profession practiced. In most cantons, up to CHF 12,000 is tax deductible. In addition to the actual costs of further education, costs for learning materials as well as travel expenses are also recognized.
Taxes in the part-time job
Taxable income can be reduced by taking a part-time job. In some cantons and at the federal level, up to 20 percent of the additional income can be deducted from taxes as a lump sum for professional expenses. Deductions exceeding CHF 2,400 must be documented.
Costs for bicycle and public transport
In most cantons, you can only deduct costs for commuting to work by car for tax purposes under certain conditions, which may vary from canton to canton:
- nearest access to public transport is more than one kilometer away from the workplace or home
- public transport does not run at the beginning or end of the working day
- Door-to-door commute is at least an hour shorter by car than by public transportation
- public transport cannot be used due to illness or disability
- Employer requires you to use your private car while at work and pays for it
- However, car and motorcycle expenses can be claimed against tax without limitation in the cantons of Jura, Appenzell-Innerrhoden, Glarus, Vaud, Zug, Grisons, Neuchatel, Fribourg, Obwalden, Solothurn, Ticino and Uri.
For journeys to work by bicycle, you can deduct CHF 700 as a lump sum in most cantons.
If you travel to work by public transport, you can include costs for the subscription in your tax return.
Other professional expenses that you can deduct
Other professional expenses are also tax deductible. You should submit proof of computer, smartphone, textbooks, meals or professional clothing with your tax return. The amount of deductible contributions differs, depending on the canton. If you work in a home office, you may also be able to deduct costs for rent, electricity, heating or furniture on a pro-rata basis for tax purposes under special circumstances.
Professional expenses also include the cost of meals away from home, which in some cantons can be claimed against tax under special circumstances.
Tax deductibility for children
You can also deduct minor children for tax purposes. The possible deductions differ, depending on the canton. If your children are already of age and are still in education, you can also make deductions. Education expenses are deductible if the children live in your household and have not yet reached the age of 25. If you pay alimony for a minor child who no longer lives in your household, these amounts are also tax deductible. The parent who receives the alimony must pay tax on it.
Maintenance costs for real estate
If you have purchased a property, the maintenance costs are tax deductible. Depending on the canton, different flat rates apply for maintenance work. This also applies to vacation homes and apartments. If you, as a condominium owner, make contributions to renewal and management funds of the condominium association, you can claim these contributions for tax purposes if they are used for value-preserving measures.
Deductibility of debts
You can also deduct debts up to a maximum of CHF 50,000 for tax purposes if they are loan interest from private loans, mortgages, interest on arrears or credit card balances. Building loan and building lease interest cannot be deducted in some cantons. Lease interest and lease payments are not deductible.
Social deductions by age and marital status
You can save taxes with social deductions, which vary according to age and marital status. You do not have to substantiate the expenses. You only need to provide proof of personal circumstances. The amount of social deductions also differs, depending on the canton. If you are a low-income earner, you can make additional deductions in some cantons depending on your marital status. If you support a partner who is unable to work or financially weak, further social deductions are possible.
If you pay alimony to your divorced or separated spouse, these costs are also tax deductible.
Save taxes with donations
In the case of donations, you can deduct a maximum of 20 percent of your net income for tax purposes in most cantons. In most cantons, you must donate at least CHF 100 annually to declare the amounts on your tax return. Recognized are donations to institutions that pursue public purposes or serve the public good. Donations to the federal government, cantons and municipalities are also tax-deductible. This also applies to party donations, regardless of which party you support. Donations in kind are also tax deductible.
Seek help from the tax advisor
A tax advisor takes a fee for his services, but it makes sense to use him. This is particularly useful for higher incomes and for the self-employed. The tax advisor shows you where you can save taxes and what is deductible. He knows perfectly legal tax tricks and is also familiar with the regulations in force in your canton.