It is reported that there is one person leaving the UK every minute, but
I am sure there is no need to be fearful of the UK becoming under populated,
as there is just as many foreigners coming in. There are many reasons
to leave the UK:- disillusionment, new job, new start, taxes. The latter
has been the principal reason for many people leaving the UK for Switzerland,
and it has been long considered to be the route exclusively for the rich
and famous. However, in the last few years with relaxation of restrictions
and lowering of financial requirements it has become a consideration for
a far wider band of people with more moderate economical situations .
Our reasons were that we loved the country, the area we were in, and felt
we wanted a change, a bit of a challenge. I knew I could not retire in
the UK without being drawn back full time into the business, and also
the tax savings were a consideration
In our preliminary meetings with UBS we found that they were most anxious
to establish that we had fully considered the consequences of leaving
the UK and moving to Switzerland and I remember well them saying “
It’s a very expensive mistake if you are not happy”
Well it is a year on since we obtained our “B” permit and
so far, so good, but we always bear in mind that nothing is for ever and
if we find it untenable we can always go back to the UK.
With new restrictions on purchasing property in Switzerland one of the
possibilities to overcome the restrictions is to obtain a “B”
permit which is a permit to live in Switzerland. This gives you all the
privileges of being a Swiss person, freedom to purchase property etc,
but you can not vote. You retain your UK or country of birth as your nationality.
Because of this ability to overcome the restrictions of buying property
in Switzerland the question of “B” permit is coming up more
often so I have tried to put the pros and cons as I have found them. I
am not a financial or legal expert and if you are considering going this
route, I urge that you get good counselling from both a UK and Swiss source.
Many people offer the service to obtain a “B” permit we used
UBS Bank in Sion and have been delighted with the service we obtained
from them.
So to the details :-
|
Requirements
The requirements for a B permit are:- a, you are over 55 and retired,
b, you have no gainful employment in Switzerland, and c, you have sufficient
income to support yourself in Switzerland.
Point “a” is obviously not a requirement that is adhered to
because I am sure that Louis Hamilton is a long way off being retired
and is certainly not 55.
Point “b” is quite simple if you do have earnings in Switzerland
then they will tax you on this income and if it is full time employment
then you will not be able to apply to pay tax under the lump sum or “Forfait
Fiscale” more on this later.
Point “c”, you can satisfy this point by filling in a questionnaire
that will require information on all your earnings investments etc. The
Swiss authorities are looking for proof that you have at least sufficient
funds to provide an income of approx 90,000 Fr per annum. Alternatively,
if you have in excess of 3,000,000 Fr or equivalent in Sterling Invested
with a Swiss bank then a letter of confirmation from the Bank of this
will satisfy the authorities.
Costs
It is advisable to appoint a specialist to obtain your B permit particularly
if you are going for the “Lump Sum “ or “Forfait Fiscale”.
The costs will range from 5,000 to 12,000 fr depending on the complexities
of your affairs, some Banks will contribute to this fee if you use their
specialists and you are investing with the Bank.
You will also have to pay into a Swiss pension, which is approx, 6,000.00
Fr Per Annum per couple. In addition, the Swiss health authorities are
unlikely to accept any health insurance other than Swiss which will cost
approx 3,000 Fr per annum per couple. The other costs are Taxes which
are covered below.
Advantages
The main advantages are potential tax savings and the ability to buy and
sell property.
Most foreigners coming to Switzerland do so to take advantage of the tax
system. I have tried to simplify it as much as possible, but I do stress
that I am not a tax expert and this is only my understanding of it and
I strongly urge that you seek professional advice.
The system that most foreigners are attracted to is the “Lump Sum”
or “Forfait fiscal”
(The full explanation of this can be found on the following web sites
www.switzerland.isyours.com
www.henley-partner.com
Basically the “Forfait Fiscale” is a lump sum tax payment
based on the value of your property wealth or rentable value of the property,
although it is possible to calculate approximately the amount you pay
it will depend on the canton you have your property and the skill of your
negotiator. Sum cantons also have minimum values. As an approximation
a chalet or apartment with a market value of 750,000 Fr (this is not the
value used for the tax calculation but the value the Canton give it which
will be less) the tax will be approximately 40,000 to 50,000 Fr per annum.
This is all the tax you will pay no matter how much income you derive
or interest you receive providing it is not earnt in Switzerland. Interest
on Sterling accounts held in Swiss banks does not count.
For me another advantage in this system is that a large proportion of
the tax is paid to your canton and commune directly, which I find very
comforting to know exactly where my taxes are going and that the community
I live in will benefit from them
One very big advantage is that you get to live in a wonderfully civilized
country with beautiful scenery and very polite and kind people.
There are countries that offer even better tax advantages but none that
appeal as much as Switzerland.
Disadvantages
When you obtain your “B” permit you will be considered a Swiss
resident which in its self is not a disadvantage but you are subject to
the same property laws. Which, whilst, allowing you to purchase and sell
land means you cannot sell to a Foreigner and under the current regulations
this is an indefinite restriction. You can of course sell to a Swiss and
far from being a depressed market a Swiss buyer will not pay as much as
a Foreign buyer. You are able to buy and sell land to Foreigners providing
they can obtain a permit but you will have to pay tax on any gain.
You will also within 6 months have to buy a Swiss Vehicle or get your
UK vehicle plated in Switzerland which can be difficult and expensive.
Vehicles in Switzerland are currently cheaper than in the Uk and Taxing
and Insurance is about the same.
Time
Scale
It took us two months to obtain our B permit , and 9 months before we
had our first tax bill.
Useful Sites
www.UBS.ch
www.englishforum.ch/
/www.myswitzerland.co
|