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Trader's Taxation in Switzerland
- Thread starter syspool
- Start date
You negotiate with each Canton individually. Pick the one you want to live in and then begin to wine and dine and put on the full court press.
However...if you are an American you still owe to IRS regardless of where you live.
However...if you are an American you still owe to IRS regardless of where you live.
Quote from ITR2744:
Summarized I can tell you, that only basic buy and hold trades fall under this definition.
Any active trader has to pay normal income taxes on his profits. Such a trader will be considered as self employed and has to pay also social insurance etc., overall the tax is about 25-30%,
In practice that's not really how it works. It's my understanding that as an individual investor you are allowed to manage your money as you see fit, and that means trading in and out if you wish. I can tell you that private banks like many other "financial advisors" will make your account trade and they know that you won't pay taxes. Don't you think they can afford the best lawyers in Switzerland ?
The tax authorities appear to have no way to check that and they are not inclined to do so probably because you could deduct your losses as well then .
The criteria are not really setin stone I believe. But I would say that if you act as a professional trading firm would, making a market for example or doing mostly arbitrage strategies, and have no other official occupation then you definitely would fall under the professional trader definition. If you can afford to be in CH with the program for wealthy individual then you probably wouldn't want to do much trading anyway and just enjoy your money like the idle rich !
Quote from Kicking:
In practice that's not really how it works. It's my understanding that as an individual investor you are allowed to manage your money as you see fit, and that means trading in and out if you wish.
Dream on...
http://www.steueramt.zh.ch/html/erlasse_merkblaetter/w_wertschriftenhandel.htm
thanx for the link, ranger. These are exactly the criterias...
Sure, if you don't trade your account by yourself, you won't be declared as a trader and thus pay no taxes. But trust me, if you trade as an active daytrader, you will be considered as self employed.
There are several federal court decisions to this topic:
BGE 122 II 446:
http://www.bger.ch/index/juridictio...isdiction-recht-leitentscheide1954-direct.htm
conclusion: if your trading activities go beyond a normal private wealth management, you will be considered as self employed and thus have to pay taxes on your profits.
http://www.baselland.ch/fileadmin/baselland/files/docs/fkd/steuern/praxis/1998/3_1998_121-124.pdf
conclusion: 59 transactions within 4 years: NO taxes : clearly no active trading
see also Kreisschreiben of the federal tax departement:
http://www.estv.admin.ch/d/dvs/kreisschreiben/1-008-D-2005-d.pdf
Sure, if you don't trade your account by yourself, you won't be declared as a trader and thus pay no taxes. But trust me, if you trade as an active daytrader, you will be considered as self employed.
There are several federal court decisions to this topic:
BGE 122 II 446:
http://www.bger.ch/index/juridictio...isdiction-recht-leitentscheide1954-direct.htm
conclusion: if your trading activities go beyond a normal private wealth management, you will be considered as self employed and thus have to pay taxes on your profits.
http://www.baselland.ch/fileadmin/baselland/files/docs/fkd/steuern/praxis/1998/3_1998_121-124.pdf
conclusion: 59 transactions within 4 years: NO taxes : clearly no active trading
see also Kreisschreiben of the federal tax departement:
http://www.estv.admin.ch/d/dvs/kreisschreiben/1-008-D-2005-d.pdf
Quote from Big:
ie you are not supposed to work at all in switzerland, just live there.
Historically, this has been the regime of choice for the likes of pro tennis players, F1 race drivers, and rich people who live off off their portfolio/trust funds.
pro tennis players do not play tennis in switzerland, only in melbourne, paris, Wimbledon, australian open etc.
So in between tournaments, they go back to their house on shore of lake geneva, and have a good rest.
Same goes for F1 drivers.
Rich people have their money invested in places, funds etc, and just live off the proceeds.
So, what if you did want to get a job there - or you're not really talking about that, right?
Quote from ranger64:
Dream on...
http://www.steueramt.zh.ch/html/erlasse_merkblaetter/w_wertschriftenhandel.htm
Would you have this link in French ?
I am not a daytrader, but I trade and the tax authorities have never asked questions since I moved here, perhaps it's small change to them. I have talked to people, FX brokers in CH , they never said such activity was taxable. Regular people "dabbling in the stock market" also say there is no taxes so go figure.
I researched this a couple years ago and from I have been told and from I have read on here (several threads) there has been some attempt by the tax authorities to go after capital gains from active trading but this happened back in 2000 . Since then ,I was told the authorities haven't really pursued that type of revenues because then too many people would deduct their losses. Also only about 20 % of the population own stocks.
It's the circulaire numéro 8, this circulaire is adressed to the tax departements of the Kantons and they have to adapt their practice accordingly.
http://www.estv.admin.ch/f/dvs/kreisschreiben/1-008-D-2005-f.pdf
http://www.estv.admin.ch/f/dvs/kreisschreiben/1-008-D-2005-f.pdf