Tax Deductions in Switzerland for 2024
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We all want to pay lower taxes! When you fill out your tax declaration in Switzerland, it is important to take advantage of all possible tax deductions. Tax deductions allow you to reduce your taxable income. Since your taxable income will directly drive your taxes, it is essential to reduce it when possible.
So, in this article, I go into detail about all the possible tax deductions in Switzerland. Hopefully, you will be able to find tax deductions that you did not use before and will be able to reduce your taxes.
I will try to stay generic since many of these tax deductions will differ from canton to canton. The maximums and minimums for each tax deduction will likely change a lot. And the deductions may be different at the federal and the cantonal levels since both have different maximum deductions.
Commute Expenses
A tax deduction that almost everybody can claim is related to commuter expenses. If you need to pay something to go to work, you can deduct these expenses from your income.
First, if you go to work by car, you can deduct the kilometers from your home to your work. If you work full-time, you can deduct a maximum of 220 times the round trip from your home to your work. You also need to justify using a car, but generally, it is not difficult to justify it. For instance, in my case, there is barely any public transportation where I live.
If you go to work by public transportation, you can deduct your public transportation subscription price.
Finally, you can also deduct a flat rate for your bike if you bike to work. Interestingly, most cantons will accept to deduct for both public transportation and bikes if you do both.
Each canton will have a different maximum for this deduction. But this is an important deduction since it can easily account for several thousand Swiss francs removed from your taxable income.
Meal Expenses
If you cannot go home for lunch, you can also deduct your meal expenses. In some cases, you will also be able to deduct your dinner expenses if you cannot even go home for dinner, but you will have to justify it.
In general, you can deduct 15 CHF per meal taken outside of your home. If you have access to a discounted canteen or if your employer contributes to your meals, you will only be able to deduct 7.50 CHF per meal.
Once again, there will be a maximum at the federal and cantonal levels for this deduction. But it is an important deduction since it can be substantial (especially if your company does not have discounted canteen).
Spending nights at the place of work
If your job forces you to spend nights outside of your place of residence, you can deduct your accommodation expenses from your place of work. You will also be able to deduct transportation from your place of residence to your place of work twice a week. In that case, do not forget to claim tax deductions for both meals during the day!
Work-Related expenses
You can also deduct other work-related expenses. For instance:
- Work clothing
- Books
- Hardware and software
- Courses
You can apply a 3% flat tax deduction from your net income. However, there is a maximum of 4000 CHF per year. If you have higher costs, you can also deduct the effective costs with all the necessary justifications.
If you have to drive at work in your personal car, you will also be entitled to a tax deduction based on the number of kilometers you drive.
Professional Development
If you take significant training to improve your professional career, you can also use it as a tax deduction. If you do a reorientation course to change jobs, this can also be deducted here. In some cases, you can also count language courses in that category.
You will have to justify these expenses, and you will have to pay for them yourself. You cannot deduct it if your company pays for it, as is usually the case.
In some cantons, you can deduct some training without justifications. It is the case in Zurich, but there are probably some other cantons that allow you to do that.
Home Office expenses
Currently, when we are forced to work from home, the situation is confusing. Each canton has announced different sets of rules for home office tax deductions. If you are forced to work at home in most cantons, you can still deduct the same deductions.
But in general, if you are working from home, there are a few things you can deduct :
- You can deduct the cost of the equipment you use to work at home if your employer does not provide it.
- You can deduct the rent price of a room if you are using it solely for the home office.
If you are still deducing the same in-office work deductions as before during COVID-19, you will not be able to claim home-office deductions. You will have to choose.
We can expect the rules to change after the COVID-19 situation.
Third Pillar Contributions
The best tax deduction is probably to contribute to your third pillar. Each year, you can contribute up to 7056 CHF (as of 2023) per employed person in your household. So, if you have two employed people in your household, you should contribute to both if you can.
This 7056 CHF per year is removed from your taxable income. This makes a very significant difference to your taxable income. If self-employed, you can contribute up to 20% of your net income into the third pillar, up to a maximum of 35’280 CHF.
Now, you should only invest in a good third pillar. And you should invest your third pillar money in the stock market as much as possible. Otherwise, the returns will be very low. If you do not have a third pillar yet, look at the best third pillar of Switzerland.
If you invest in a great third pillar, this is almost free money. Most other tax deductions will allow you to deduct the money you spend. But this tax deduction allows you to deduct the money you invest, which is much better!
Second Pillar Contributions
You can also get a tax deduction for the money you contribute voluntarily to the second pillar. If you contribute extra to the second pillar, this contribution is tax-deductible.
How much you can contribute depends on your second pillar contribution history You can ask the second pillar provider to know how much you can contribute. This can be a significant amount (sometimes more than 100’000 CHF). So, you can realize huge tax deductions with this technique.
However, this is only interesting if you can access a good second pillar with good returns. And unfortunately, this is not the case for most people. For instance, it returns less than 1% on average, which is pitiful.
Also, you need to ensure you can get a tax deduction. If you have withdrawn money from the second pillar for a house or a startup, your extra contributions will not be tax-deductible until you have repaid what you take out. This is why we do not invest in our second pillar.
If you want to know more, you can check whether you should contribute to your second pillar.
Just like contributions to the third pillar, contributions to the second are almost free money! The issue with the second pillar is that returns, for most people, are pretty bad.
Debt payments
If you have debts and are paying interest payments, you can get a tax deduction from them. For instance, if you have a consumer loan or a mortgage, you can deduct all your interest payments. It is the same for credit card debt, which few people know.
On the other hand, you cannot claim interest payments for leasing since the object (likely a car) does not belong to you during the leasing. This could be why a car loan could be more interesting than leasing sometimes.
You should also not forget to deduct the value of your debts from your taxable net worth. This can make a large difference in your net worth taxes.
Donations
If you donate to a charitable organization, you can get a tax deduction for the donated amount.
The tax office recognizes many non-profit organizations in Switzerland, and you can donate to them to save on taxes. You will have to keep the donation certificates from the non-profit organization for your tax declaration.
The great thing about this deduction is that the limit is very high. At the federal level, you can deduct up to 20% of your net income. At the cantonal level, it will vary from 10% to 20%.
Insurance Premiums
Another good tax deduction is the deduction for insurance premiums.
Since health insurance is mandatory in Switzerland, you are already paying for it. So, it is good to deduct a little money from your taxable income for it.
You can deduct your premiums for health and accident insurance. At the federal level, the maximum is 1700 CHF for singles and 3500 CHF for married couples. Several cantons allow deducting more than that. The issue is that this is much lower than what we are paying. But it is already better than nothing!
In any case, you should try to reduce your health insurance premiums.
Medical Expenses
If you have high medical expenses, you can deduct some of them from your taxable income. These medical expenses include:
- Doctors
- Dentist
- Prescribed medications
- Glasses and lenses
- Prescribed care
If you have to pay these from your own pocket (no supplemental insurance or high deductible, or both), you may deduct them from your taxes. However, in most cantons, you can only deduct expenses higher than the minimum of 5% of your net income. So, if your expenses are lower than this minimum, you will not be able to deduct anything. This means that, in most cases, you cannot deduct anything.
Childcare
Childcare in Switzerland is incredibly expensive. Fortunately, you can deduct childcare expenses from your taxable income.
If your child is less than 14 years old and you must pay someone to care for him, you can deduct this. The tax deduction is due for childcare facilities or day nurseries.
The maximum tax deduction is 25’000 CHF at the federal level, while it varies highly for each canton. This is an important deduction that you should not forget since it will make a big difference to your taxable income.
Unfortunately, most cantons will not accept deductions for childcare if one of the spouses is not working. They will assume that the non-working spouse can take care of the child.
Couples
If you are in a couple, there are two different possible tax deductions:
- If your spouse does not work, you can deduct 2600 CHF from your taxable income.
- If your spouse works, you can get a double-earner tax deduction. This is 50% of the lowest of the two incomes, with a minimum of 8100 CHF and a maximum of 13’400 CHF.
Dependents
If you have children or care for disabled dependents, you can claim up to 6500 CHF per dependent. At the cantonal level, this will vary highly from one place to the other.
If you are divorced and pay alimony to your ex-partner, you can deduct these alimony payments from your taxable income.
You can also deduct gifts you have made to a person who needs this money to live in some cases.
Assets management fees
You can deduct the fees for storing your investment assets:
- Custody fees
- Safe deposit box fees
- Fees for your savings accounts
- Negative interest rate fees
In most cantons, you can deduct the effective fees or a flat rate. The flat rate is generally a per thousand value of your net worth. In most cases, the flat rate is higher than the effective costs, so it is better and easier to deduct the flat rate.
House Renovations
If you are doing renovation work on your house (painting, kitchen renovations, heating renovations, …), you may be able to get tax deductions. Whether you can deduct it or not depends on the matter of the work:
- If the renovations increase the energy efficiency of the house, you can deduct it from your taxable income. For instance, changing your windows to improve insulation or switching to a heat pump.
- If the renovations increase the house’s value, you cannot deduct it from your taxable income. For instance, if you add a winter garden to your home.
- Other renovations that do not increase the house’s value can be deducted.
If you are planning large work, it may be interesting to spread it over several years. Since tax is progressive, you can save more money over two years than one. But that is only interesting for large expenses.
House Expenses
You can also deduct other house expenses from your taxable income. However, very few of them are tax-deductible, and you will have to check with your canton what you can deduct. One example is the building insurance premium you can deduct in most cantons.
You will add these expenses together with the house renovation costs. And you can choose either a flat rate or an effective tax deduction. If you do not have any renovation work, you should opt for the flat rate that will likely be higher.
Reduce your property rental value
When you are a homeowner living in your home, you will pay taxes on a fake income, the rental value of your home. You are paying taxes as if you were renting it out. This adds to your taxable income. This can significantly increase your taxes.
There is only one way to reduce this property rental value: claim underutilization of the house. This is possible if you have one room in your house that is not being used. You can claim that you do not use this room and ask for it to be removed from the calculation of the rental value. This can make a significant difference in your rental value and hence taxable income.
Of course, you should only do that if the room is really not used. In general, they will ask that the room is really not furnished (empty).
It is also worth knowing that this is always allowed at the federal level, but not all cantons will take this into account. And for this procedure, you will need to ask for a new evaluation of your imputed rental value.
Declare your withholding taxes
Finally, if you have paid withholding taxes, you should not forget to declare them. These withholding taxes will count toward the taxes you have already paid. So, they will effectively reduce the taxes you still have to pay.
You will pay withholding tax on the following gains:
- Dividend payments
- Annuities and pensions
- Lottery gains
If you are using some U.S. ETFs, you can even deduct the withholding that was done at the source by the United States tax office. I have a guide about declaring dividends from U.S. ETFs. However, this deduction is generally not admitted below 100 CHF of foreign withholding.
Conclusion
As you can see, there are many possible tax deductions from your taxable income. However, there is no magic deduction that you can do. Some tax deductions are almost free, such as the third and second pillar contributions. However, most deductions only allow you to deduct things you have paid.
So, in general, there is not much you can do to deduct more from your taxes. The most important thing is that you should not forget any tax deductions! You should make sure you are deducting every possible thing you are allowed to.
Swiss taxes may be fair, but they will be the highest item on your budget if you have a significant income. As such, it is important to do everything possible to reduce them to the maximum.
If you want more information, read my guide on Switzerland’s taxes or my article on the marginal tax rate.
Do you know any other tax deductions that we can use?
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Dear Baptiste,
thanks for a great post. I have a few questions and hope you could help:
1. Do you know what happens if somone has B permit and tax at source, but crosses the 120k limit in the year? Would the best practice be to file the self-declaration form and try to deduct the different contributions to minimiz the difference?
2. For the commute deduction, does it only work for actual subscriptions or would daily receipts be enough? E.g. using the app
3. For the work expenses, how strictly are these considered? E.g. I do buy specific office clothes that i wouldn’t if I wasn’t in this job, but i understand this is borderline as I don’t have a uniform.
Thanks in advance,
Ana
Hi Ana,
1) I think you will have no choice but to fill the tax declaration, it should be automatic the year after you reached the 120k threshold.
2) Good question. If you have all the proof, you should be able to deduct it. And if it’s every day the same thing, I would believe that most tax offices are okay with bringing a few examples and justifying that you multiply this by the number of days per year you commute. But it’s best to ask your local tax office this.
3) I don’t know how strictly these are considered. But in some professions, you need to wear suits for instance, so you could justify it. In that case, you need to make sure the amount is higher than the 3% flat deduction. If above that, you will have to justify every item with receipts.
I find this calculator quite useful to estimate tax liability. If you want to understand how much tax you owe to government vs what was deducted from source, this can help.
https://www.helvetia.com/ch/web/en/private-customers/contact/services/pension-analysis/tax-calculator.html
Interesting, it seems quite accurate by using only a few numbers.
Indeed. I find it most accurate when using the section of taxable values. Since deductions are very individual, once someone know what’s the final taxable income and wealth, the calculation works very well.
Hi, thanks for this post.
This is my fist year in Switzerland, and I’m under a 1 year temporary contract (with potential extention).
We are a family of 5 (three kids below 12yo). My wife doesn’t work.
What’s the % of the third pillar that I can deduct from taxes?
For example, if I contribute (yearly) 5000 CHF to the 3rd pillar, what % of those 5000 CHF can I deduct from taxes?
Is it convenient to contribute to the 3rd pillar for me?
Thanks and regards
Hi Eduardo,
You can always claim the same amount, regardless of your situation. In 2023, this is 7056 CHF.
How much you can save depends on your marginal tax rate and this depends on your income and other deductions, there is no way for me to know that.
Also keep in mind that if you pay tax at source (likely on a 1-year), you cannot deduct anything.
Thanks a lot. Do you know where or how can I calculate my marginal tax rate?
I’m not taxing at source. I’m on a temporary contract, but my wife & kids are swiss. So we are staying in Switzerland for good.
If you are not taxed at source, it may become interesting indeed.
I have an article about the marginal tax rate that may help you: Your Marginal Tax Rate and all you need to know about it
Dear Mr. Wicht, I recently started tracking our expenses and I realized we pay a lot for someone to handle our taxes, is this normal in Switzerland or should we be able to do it ourselves? We earn one salary and only normal household expenses, so nothing complicated. Thank you, N Roos
Hi Nadia,
From what I know from people around me: Most Swiss-citizens do their taxes themselves while most expats are using advisors to do it. I think it comes down to “marketing” and these services being advertised to expats.
But I think in the immense majority of cases, it’s very easy to fill taxes. I have always done it myself and it’s really not rocket science in standard cases, like yours seem to be.
I have a question about 2nd pillar. Let’s say if someone started working in CH and have always contributed to 2nd pillar.
In that case, the only way to contribute into 2nd pillar for tax savings would be to actually pre-finance one‘s retirement and hence it would only make sense if one wants to retire early.
I have read that voluntary contributions cannot exceed 5% of the total projected pension at age 65.
I am wondering if these 100K or more limits for 2nd pillar are based on assumption that retirement would happen at 58 or so.. right?
Hi Abhiney,
I am not sure I get. Even you start contributing at 20 in your second pillar and always contribute, you will still likely have gaps. Indeed, your salary will hopefully have increased and this will create a gap as well.
I have worked and contributed since I was 25 and I have a huge gap in my pension fund.
I never heard about the limit of 5%, it may be only some pension funds. Normally, you can profit from tax savings, regardless of whether you are doing early retirement or not. But maybe I am missing your point.
Good evening
What I am trying to say is that as per my understanding the so called gaps are generally due to following
– missing years of contribution due to no employment or some other reasons
– lump sum withdrawals
– divorce related reduction in pension fund
– early retirement
I don’t quite understand the calculation of the gaps created due to salary progression.
When I asked this question to the pension fund, I was told that one cannot be over insured in terms of pension and pension funds allow a certain access compared to what could have been the case without voluntary contributions. So I guess one should always ask what the maximum contribution is actually based on. Typically the default calculation is based on some sort of assumption of early retirement
The link below. Article 1b also mentions this.
https://www.fedlex.admin.ch/eli/cc/1984/543_543_543/de
This is why I was intrigued because in your comment, you have mentioned that gaps can also exist due to salary progression over time. Are you sure that this is also a variable?
Hi Abhiney,
Yes, I am sure that salary increase will increase the gap over time. This makes sense. If you now earn 100’000 CHF, your pension fund is supposed to cover a percentage of that 100’000 CHF. But if you were previously earning 80’000 CHF, you did not contribute enought to cover your current insured salary.
But you are right there are two gaps
* The standard gaps to retirement at 65, which covers early withdrawals (no tax advantage to put them back), missing years and salary increase or pension fund changes
* The gaps to early retirement at 58 where you can put back a lot of money in order to retire early
In my case, I can put back about 200K for the standard gap and 500K more if I want to gap for early retirement.
Hi,
Sorry for my question but I am really new to swiss taxes. This year I earn more than 120.000 CHF per year so I can now declare my taxes.
When it comes to tax deductions, how can I prove my expenses? For example meal expenses or work related expenses, should I keep all the receipts I spent every day and give to the tax authorities?
Thank you for all the reply in advance!
Akos
Hi
It depends. You have two choices:
* Either you use the standard deduction and you don’t have to prove anything. For instance, you will get a fixed amount per meal regardless of what you ate.
* You declare the real costs, in which case you have to list everything. And in this case, you should be prepared with all the necessar receipts.
In most cases, it’s not really worth it to declare the real costs but rather use the standard deductions unless you had some really extraordinary expenses.
Hi Baptiste,
Thank you for the reply.
So that means, when I do my tax declaration, I just give the maximum amount of deductible meal expenses without any proof. I just need to show where I work and where I live, right ?
That’s correct :)
Keep in mind that if your employee subsidizes your meal, you have to opt for the cheaper option of the two, but aside from this, you don’t have any justifications necessary.
If you live next door to your employee, they may wonder why you don’t eat home for instance.
Hi Baptiste,
I am in Canton de Vaud, work in Geneva, H3, salary plus pension alimentaire. I am under “B” so taxed a la source only on my salary. Would it be worth it for me to fill-up the forms and have some tax return? Or should I just leave it as it is and wait for C when it becomes compulsory?
Many thanks
It’s impossible to say without filling the tax declaration. In most cases, it’s safer to stay with tax at source until you are forced to fill it.
What you could do is use the tax software of your canton, fill the tax declaration and use the estimation provided by the software (if your canton does that). And then compare this estimation with what you pay now and take an educated guess.
Hello Baptiste,
I am just finalising my online tax declaration for 2022, and I noticed that that my ‘Ubrige Berufskosten Hauptwerb’ section seemed to be pre-filled with a ‘default’ value which is different to last year’s value.
I have been retired since December 2021. I think these professional expenses should normally be zero if I’m retired… right…?
Thanking you in advance for your advice.
Best regards,
Hi,
I also think these professional expenses should be zero if you have no income.
If you want to be sure, you should contact your canton’s tax office.
Hello Baptiste,
Thanks for this comprehensive blog, showing us the options to have deductions on our taxable income.
I would like to clarify, since you live in Fribourg, if there is a difference with Vaud for my concrete situation.
I received a shares portofolio from my mother but I have to pay her fix 3% every year. As this corresponds to ‘rente viagère’ (in French) I can deduce in Vaud up to 40% of this amount, but I have of course to pay tax on dividends earned and on the capital.
Is this also 40% in Fribourg, or different?
Kind regards,
Hi Laurent,
I had to check because this is a quite specific case.
But in that case, both cantons are the same indeed. You can also deduct up to 40% of it and you also have to dividend taxes.
Hi Baptiste and thanks for yet another great post.
From what I can see in [1], the withholding tax paid is refunded in full if earnings are declared properly in the tax declaration. So I’m a bit confused with what I read here and in the link below, as you mention that “these withholding taxes will count towards the amount of taxes you have already paid”, while it seems that these taxes are actually refunded. Can you please clarify?
Thanks!
[1] https://www.ch.ch/en/taxes-and-finances/types-of-taxation/withholding-tax/#what-is-taxed
If you look into the article, you can see “As a rule, the canton deducts the amount owed from the bill for cantonal taxes.”. So, if you need to pay 10’000 CHF in taxes and get a “refund” for 1000 CHF of withholding tax, you will only pay 9000 CHF.
Thank you for this helpful information. My husband and I have B permits and taxed at source currently. I understood from the article that tax deduction are possible only when we opt for self-declaration, however you mention that it is not always beneficial. Could you please explain what is difference between taxation under WHT regime and self-declaration (with possibility to deduct expenses) if the last one is not always the best? For instance, would you think that child deduction (my husband has 2 but they do not live with us, however he pays alimonies) and credit interest would mean for us to go with self-declaration as the best? Thank you for your time
Hi,
Indeed, these deductions are on the self-declaration form.
I really can’t say it would be best for you. It depends on many factors, such as income and all deductions. If your husband could claim some large deductions, it could be interesting indeed. But again, the two systems are different enough to difficult to compare.
If your canton’s software allows it, one thing you could try is download the software for your canton and fill up the declaration and get an estimation of the taxes. That way you would see whether that’s lower or higher than what he pays now.