The most important form of tax for most people is the income tax. In addition, the state, cantons and local authorities also apply various types of taxes.

Predicting your tax burden

Before you can draw a budget, you need to find out roughly how much tax you need to pay. If your household income is the same as the year before, you can go by the tax bills that you receive from the tax office. They are based on the previous year's tax assessment. If your circumstances have changed, you need to try to estimate what your ultimate tax liability will be on the final bill.

You can ascertain how much tax you are likely to pay using one of the many tax calculators available on the Internet. The forecast is reliable if your canton has an online calculator. If you want to stay on the safer side, use the highest forecast as a basis for your budgeting.

Tax comparison by comparis

Homegate tax calculator

The safest thing to do is to set aside monthly reserves

If you do not have much room for flexibility in the household budget, you should set aside reserves on time to ensure that you can pay your tax bills on time. If you find it difficult to keep an overview of things, the best thing to do is to set up an account to which you transfer the tax reserve payment every month. Divide the amount by 12 if you obtain a thirteenth month's salary or a bonus. If possible, divide it by 11 if you do not receive a thirteenth month's salary. You can use the reserve to cover any unpleasant surprises.

The aim of the annual tax returns is to set out your income and expenditure clearly for the purposes of income and property tax. Your direct taxes can then be calculated on this basis. Each tax form comes with instructions on how to complete it. Go through the form step-by-step. It is far less complicated than many people suppose.

It is even easier to file your tax returns online. Certain details are automatically inserted and calculated. You can order the relevant software from the tax office in most cantons or download it directly from the Internet.

How it works

For example, during the year you receive one or more bills, which have been compiled on the basis of your last tax returns. If the amounts are not too high, you should pay the bills by the given deadlines, otherwise you will have to pay a penalty. At the start of 2009, you will compile your tax return for the previous year. Your tax liability can be calculated accurately based on this. If you have over-paid taxes on the basis of the provisional bill, you will be reimbursed the surplus along with the interest. If you have not paid enough, you will have to pay the amount that you have fallen short of.

Tax audit and fines

The tax assessment is an official process. All steps must take place within time limits set by law. Not all the cantons insist that the deadlines are strictly adhered to. You can generally apply in writing for a deadline extension. However, depending on which canton you are in, you risk an administrative fine if you fail to meet the deadlines. This may lead to the unwelcome prospect of receiving a "discretionary assessment". You can be sure that your tax liability would not be set too low in it!

Your tax returns are checked to ensure that the details are complete and correct. If the tax office suspects that you have not answered all the questions correctly, you will have to contend with the questions or have to submit your records for scrutiny. If you tamper with the figures in your tax return, you may face prosecution.

Further Information

Federal Tax Authority

Swiss Tax - Swiss tax law on the Internet