A tax return in Switzerland is not automatic for every foreign employee. Whether your transferee files one depends on the permit held and on income. Many assignees never see a return in their first years. Others must file from the start of the assignment.
HR and mobility teams need to know which group each transferee belongs to. The answer changes payroll set-up, tax-equalisation calculations and what you ask the employee to prepare. This page explains the rule, then the practical consequences for an employer.
Two ways of being taxed
Switzerland taxes individuals in one of two ways. Which one applies is set by the permit, not by nationality.
- Taxation at source (Quellensteuer). The employer deducts tax from each salary payment and pays it to the canton every month. The employee does not file a routine return.
- Ordinary assessment. The employee declares income and assets in a tax return, and the cantonal tax office issues a bill.
Foreign nationals who do not hold a permit C (settlement permit) are taxed at source, according to the Federal Tax Administration (FTA). Once a transferee holds a permit C, the ordinary return applies instead.
The two admission regimes, EU/EFTA and third-country, lead to different permits. They do not by themselves decide the tax route. The permit that results does. For the regimes, see the State Secretariat for Migration (SEM).
The decision path for an assignee
The path shows why the permit comes first. Get that wrong and every later step is wrong too.
Below the income threshold: at source, return on request
For a transferee with a permit B or L and income below CHF 120,000, tax at source is in principle final. The Federal Tax Administration (FTA) describes this as the standard route for most assignees.
The employee can still ask for a later ordinary assessment (nachträgliche ordentliche Veranlagung). This is a request, not an obligation. It may be worth considering when the employee has deductions that the at-source tariff does not reflect, or other income. A specialist reviews the individual case. This page does not.
Two practical points for the employer:
- Ask the employee early whether they expect to request an ordinary assessment. The deadline and procedure are set by the canton.
- Keep payroll records tidy. The employee will need the annual salary certificate the employer issues.
At or above the threshold: a return is mandatory
When income reaches CHF 120,000 or more, a later ordinary assessment is compulsory for permit B and L holders (Federal Tax Administration (FTA)). Tax continues to be deducted at source during the year. The return then settles the final position.
For HR this has three consequences.
- Plan for the filing. The employee must complete a Swiss return even though payroll already deducts tax.
- Decide who pays for preparation. Many policies cover adviser fees for the first return. State this in the assignment letter.
- Check the tax-equalisation model. Hypothetical tax, actual Swiss tax and any home-country liability must be reconciled after the return is assessed.
Details of the monthly deduction are on the page about withholding tax at source for foreign employees. For payslip mechanics, see payroll, social security and withholding tax for assignees.
What changes with status
| Situation | Permit B or L, income below the threshold | Permit B or L, income at or above the threshold | Permit C |
|---|---|---|---|
| Basic route | Tax at source | Tax at source plus compulsory later assessment | Ordinary assessment |
| Tax return | On request | Mandatory | Mandatory |
| Employer deduction | Yes | Yes | No |
| Typical HR action | Brief the employee on the option | Budget for adviser support | Remove the at-source deduction |
A change of permit is the moment to review this table. A transferee who moves from permit B to permit C changes tax route, even though the job has not changed.
Changes during the assignment
Four events can move a transferee from one route to another.
- New permit. A permit C ends taxation at source.
- Salary increase. Income that crosses the threshold makes the later assessment mandatory.
- Change of canton. Cantonal rules on deadlines and forms differ. Read the page on when an assignee changes canton.
- End of assignment. A departing employee has final tax steps. See end of assignment and deregistration.
Lump-sum taxation (forfait fiscal) is a separate regime with its own conditions, and it is not a standard assignee route. It is explained in lump-sum taxation.
What to prepare from abroad
Your transferee can do a good deal before leaving the home country. Share this list with them.
- Confirm the expected permit type with the immigration provider
- Obtain a statement of income and tax paid in the home country for the last year
- Gather details of foreign bank accounts, pensions and property
- Ask the home payroll for a final salary certificate
- Agree in writing who pays for tax advice and the first return
- Check whether the home country continues to tax the employee after departure
- Note the arrival date, because the municipality registration (within 14 days of arrival, per ch.ch) starts the Swiss tax record
Some home countries tax their citizens or residents on worldwide income whatever happens in Switzerland. The Swiss return does not remove that duty. A cross-border specialist should look at the individual case.
Common mistakes
Assuming at source means no further duty. For higher earners the return is mandatory.
Assuming nationality decides. An EU/EFTA citizen on permit B is taxed at source just like a third-country national on the same permit.
Forgetting the spouse. Family circumstances and a partner's income may affect the route, depending on cantonal rules. Ask the adviser.
Leaving the question until the first tax bill. By then, choices have already been made.
Treating the return as a payroll task. Payroll deducts. The employee files. Keep the two roles separate in your policy.
How the employer can help
The employer is not the taxpayer. It is the party that deducts, certifies and often funds advice. A clean process has four parts: a pre-departure briefing, accurate payroll, a salary certificate, and a referral to a qualified tax adviser. Costs for this sit within the relocation package.
If you want help finding a tax adviser for a group of transferees, use the request at the bottom of the page. A specialist then reviews the case and the right relocation provider is introduced.
Frequently asked questions
Does every expat in Switzerland file a tax return?
No. A foreign national without a permit C is taxed at source and does not file a routine return. A return becomes mandatory at higher income or once a permit C is held.
Who is taxed at source?
Foreign nationals without a permit C or settlement permit. The employer deducts tax from salary and pays it monthly to the canton.
What is the income threshold for a mandatory return?
For permit B or L holders it is CHF 120,000 (Federal Tax Administration (FTA)). At or above that level a later ordinary assessment is compulsory.
What happens below the threshold?
Tax at source is in principle final. The employee may ask for an ordinary assessment, but is not required to.
What is a later ordinary assessment?
A tax return filed after taxation at source has begun. It lets the cantonal office compare actual tax with what was deducted. The German term is nachträgliche ordentliche Veranlagung.
Does nationality change the tax route?
No. The permit and income decide. EU/EFTA and third-country nationals on the same permit follow the same at-source rules.
Does a permit C change anything?
Yes. A permit C holder is no longer taxed at source. They file an ordinary return instead, and the employer stops the at-source deduction.
Who files the return, the employer or the employee?
The employee. The employer deducts tax, issues the salary certificate and may pay for adviser support under the assignment policy.
Can HR file on the employee's behalf?
HR should not sign for the employee. A tax adviser can prepare the return with the employee's authority. The employee remains responsible for the declaration.
Is tax at source a final settlement?
Only for those below the threshold who do not request an assessment. Above it, the later ordinary assessment settles the final position.
What documents does an assignee need?
Typically the salary certificate, details of bank accounts and assets, insurance and pension statements, and proof of deductions. The canton lists what it requires.
When is the deadline for filing?
It is set by the canton and varies. The cantonal tax office states the date on the form. Your adviser should confirm it for the canton of residence.
Does the assignee declare foreign assets?
An ordinary return covers income and assets, and that includes items held abroad. A specialist should confirm the treatment in the individual case.
Is a Swiss tax return different from a home-country return?
Yes. They are separate filings under separate laws. Some home countries still tax their citizens after departure, so both may be needed.
Do married couples file together?
Family situation can change the route and the form, depending on the canton. This is a point for a specialist, as the answer depends on the household.
Does a salary rise move an employee into a return?
It can. If income reaches the threshold, a later ordinary assessment becomes mandatory for permit B and L holders.
What if the assignee changes canton?
Cantonal procedures, forms and deadlines differ. The employer should tell the new payroll set-up and the employee should check the new cantonal rules.
Does the employer pay for the return?
Only if the policy says so. Many policies cover adviser fees for the first return. State the rule in the assignment letter.
What about tax equalisation?
The Swiss tax actually assessed must be reconciled with the hypothetical tax in your policy. A mandatory return gives you the final figure to use.
Can an employee request a return voluntarily?
Yes, below the threshold. The right is to ask for a later ordinary assessment. The canton sets the form and the time limit.
Is lump-sum taxation an alternative?
It is a separate regime with its own conditions, not a standard route for assignees. The page on lump-sum taxation explains it.
What happens when the assignment ends?
The employee leaves the Swiss register and settles final tax steps. See end of assignment and deregistration.
Where can HR get advice on a specific case?
The request at the bottom of this page starts a referral. A specialist reviews the case. This page gives general information only.