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Tax 2012 Geneva

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EricDuvoisin

Tax 2012 Geneva: A precious tool, offering a clear and precise overview on taxes in Geneva. Translation into english under supervision of Eric Duvoisin.

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Table of contents _______________________________________________________________________________________ _______________________________________________________________________________________ Individuals 4 Corporate 21 ............................................................................................................................................ ............................................................................................................................................ 1 Income 5 7 Profit 22 1.1 Rates 5 7.1 Tax rates 22 1.2 Coefficients 7 7.2 Sample calculation for the City of Geneva 22 1.3 Privileged portion for the commune 8 7.3 Statutory cantonal and municipal rates 2012 (profits) 23 1.4 Deductions 9 7.4 Losses carried forward 24 1.5 Sample calculations 11 7.5 Lump-sum provisions 24 1.6 Source tax 13 7.6 Depreciations (declining balance/straight line) 25 ............................................................................................................................................ 7.7 Participation deduction relief 25 2 Wealth 15 ............................................................................................................................................ ............................................................................................................................................ 8 Capital 26 3 Interest rates (on debts and tax liabilities) 17 ............................................................................................................................................ 8.1 Tax rates 26 4 Social security and occupational pension provision 17 8.2 Sample calculations for the City of Geneva 27 ............................................................................................................................................ 8.3 Statutory cantonal and municipal rates 2012 (capital) 28 5 Donations and successions 18 ............................................................................................................................................ 8.4 Thin capitalization 29 ............................................................................................................................................ 6 Real estate 20 9 Professional communal tax 30 ............................................................................................................................................ 10 Withholding tax 31 ............................................................................................................................................ 11 Stamp duties 32 ............................................................................................................................................ 12 Interest rates (on tax receivables and payables) 33 ............................................................................................................................................ 13 VAT 34 ............................................................................................................................................ 14 Real estate 35 ............................................................................................................................................ 15 Agreement on the Taxation of Savings between Switzerland and the European Union 36 ............................................................................................................................................ 16 Double taxation agreements (as at 1 January 2012) 37 _______________________________________________________________________________________ Your contacts 40 Tax 2012 Geneva Ernst & Young Ltd. 2
Tax 2012 Geneva The information in this brochure gives a general overview of taxation at federal level and in the canton of Geneva. It is aimed at readers with a sound knowledge of Swiss tax law and of the relevant legislation in Geneva and is intended as a source of reference material. This article does not claim to be exhaustive and cannot in any way be a substitute for the advice of a taxation expert. It discusses common law rather than exceptions to it or optimal tax planning. IFD : Direct Federal Tax IC : Cantonal Tax ICC : Cantonal and Municipal Tax CHF : All amounts are in Swiss francs July 2012 Tax 2012 Geneva Ernst & Young Ltd. 3
Individuals Tax 2012 Geneva Ernst & Young Ltd. 4
Individuals 1 Income 1.1 Rates Single taxpayer, without dependents, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD Total Tax Overall tax4, 5 Income Tax Tax ICC2 __________________________________________________________________________________________________________________________ 5,000 2 830 289 1,144 81 1,225 4.9% ...................................................................................................................................................................................................... 50,000 5,179 1,802 7,006 445 7,451 14.9% ...................................................................................................................................................................................................... 75,000 10,093 3,511 13,629 1,245 14,874 19.8% ...................................................................................................................................................................................................... 100,000 15,161 5,274 20,460 2,874 23,334 23.3% ...................................................................................................................................................................................................... 125,000 20,259 7,047 27,331 4,955 32,326 25.9% ...................................................................................................................................................................................................... 150,000 25,491 8,867 34,383 7,534 42,917 27.9% ...................................................................................................................................................................................................... 175,000 30,806 10,716 41,547 10,284 51,831 29.6% ...................................................................................................................................................................................................... 200,000 36,309 12,631 48,965 13,562 62,527 31.3% ...................................................................................................................................................................................................... 250,000 47,427 16,498 63,950 20,162 84,112 33.6% ...................................................................................................................................................................................................... 300,000 58,924 20,497 79,446 26,762 106,208 35.4% ...................................................................................................................................................................................................... 400,000 82,509 28,701 111,235 39,962 151,197 37.8% ...................................................................................................................................................................................................... 500,000 106,707 37,119 143,851 53,162 197,013 39.4% ...................................................................................................................................................................................................... 1 ,000,000 230,203 80,078 310 306 115,000 425,306 42.5% ...................................................................................................................................................................................................... Married taxpayer, without dependents, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD3 Total Tax Overall tax4, 5 Income Tax Tax ICC2 __________________________________________________________________________________________________________________________ 25,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 50,000 1,660 578 2,263 191 2,454 4.9% ...................................................................................................................................................................................................... 75,000 5,616 1,954 7,595 796 8,391 11.2% ...................................................................................................................................................................................................... 100,000 10,358 3,603 13,986 1,838 15,824 15.8% ...................................................................................................................................................................................................... 125,000 15,263 5,309 20,597 3,355 23,952 19.2% ...................................................................................................................................................................................................... 150,000 20,185 7,022 27,232 5,724 32,956 22.0% ...................................................................................................................................................................................................... 175,000 25,254 8,785 34,064 8,974 43,038 24.6% ...................................................................................................................................................................................................... 200,000 30,322 10,548 40,895 12,224 53,119 26.6% ...................................................................................................................................................................................................... 250,000 40,517 14,094 54,636 18,724 73,360 29.3% ...................................................................................................................................................................................................... 300,000 50,981 17,734 68,740 25,224 93,964 31.3% ...................................................................................................................................................................................................... 400,000 72,619 25,261 97,905 38,224 136,129 34.0% ...................................................................................................................................................................................................... 500,000 94,855 32,996 127,876 51,224 179,100 35.8% ...................................................................................................................................................................................................... 1 ,000,000 213,414 74,238 287,677 114,701 402,378 40.2% ...................................................................................................................................................................................................... are single, widows or widowers, divorced, legally 1 Estimations calculated by Ernst & Young Ltd. or de facto separated, and who live in a joint 2 The total ICC includes the basic cantonal tax, the household with their minor or adult children or a reduction of 12%, the additional cantonal and family member constituting a dependent for whom municipal coefficients, the additional charge for the taxpayer is the primarily provider of support. the city of Geneva and the personal tax of CHF 25 3 The tax base for calculating the IFD taxes take into (see sample calculations on pages 11 and 12). account a deduction of CHF 2,600 from the net The tax discount no longer applies starting 2010, income, applicable to married couples living in a as the same base tax rate is now used for all tax- joint household. payers, irrespective of their family situation. For a married couple living in a joint household, the rate 4 As per the 2011 tax rates for ICC and 2011-post applying to their income is the rate equal to 50% of tax rates for IFD their income. The same applies to taxpayers who 5 Tax rates rounded to the nearest tenth. Tax 2012 Geneva Ernst & Young Ltd. 5
Individuals Married taxpayer, one dependent, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD4 Total Tax Overall tax5, 6 Income Tax Tax ICC2, 3 __________________________________________________________________________________________________________________________ 25,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 50,000 478 166 669 - 669 1.3% ...................................................................................................................................................................................................... 75,000 3,927 1,366 5,318 350 5,668 7.6% ...................................................................................................................................................................................................... 100,000 8,407 2,925 11,357 1,262 12,619 12.6% ...................................................................................................................................................................................................... 125,000 13,301 4,627 17,953 2,649 20,602 16.5% ...................................................................................................................................................................................................... 150,000 18,206 6,333 24,564 4,694 29,258 19.5% ...................................................................................................................................................................................................... 175,000 23,227 8,080 31,332 7,878 39,210 22.4% ...................................................................................................................................................................................................... 200,000 28,295 9,843 38,163 11,128 49,291 24.6% ...................................................................................................................................................................................................... 250,000 38,432 13,369 51,826 17,628 69,454 27.8% ...................................................................................................................................................................................................... 300,000 48,888 17,006 65,919 24,128 90,047 30.0% ...................................................................................................................................................................................................... 400,000 70,395 24,488 94,908 37,128 132,036 33.0% ...................................................................................................................................................................................................... 500,000 92,631 32,223 124,879 50,128 175,007 35.0% ...................................................................................................................................................................................................... 1 ,000,000 210,994 73,396 284,415 113,703 398,118 39.8% ...................................................................................................................................................................................................... Married taxpayer, two dependents, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD4 Total Tax Overall tax5, 6 Income Tax Tax ICC2, 3 __________________________________________________________________________________________________________________________ 25,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 50,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 75,000 2,364 822 3,211 - 3,211 4.3% ...................................................................................................................................................................................................... 100,000 6,532 2,272 8,829 745 9,574 9.6% ...................................................................................................................................................................................................... 125,000 11,339 3,944 15,308 1,996 17,304 13.8% ...................................................................................................................................................................................................... 150,000 16,244 5,650 21,919 3,822 25,741 17.2% ...................................................................................................................................................................................................... 175,000 21,199 7,374 28,598 6,782 35,380 20.2% ...................................................................................................................................................................................................... 200,000 26,268 9,137 35,430 10,032 45,462 22.7% ...................................................................................................................................................................................................... 250,000 36,405 12,664 49,094 16,532 65,626 26.3% ...................................................................................................................................................................................................... 300,000 46,796 16,278 63,099 23,032 86,131 28.7% ...................................................................................................................................................................................................... 400,000 68,172 23,714 91,911 36,032 127,943 32.0% ...................................................................................................................................................................................................... 500,000 90,408 31,449 121,882 49,032 170,914 34.2% ...................................................................................................................................................................................................... 1 ,000,000 208,574 72,554 281,153 112,704 393,857 39.4% ...................................................................................................................................................................................................... 1 Estimations calculated by Ernst & Young Ltd.. member constituting a dependent for whom the 2 The total ICC includes the basic cantonal tax, the taxpayer is the primarily provider of support. reduction of 12%, additional cantonal and munici- pal coefficients , the additional charge for the city 3 The tax base for calculating the ICC takes into of Geneva and the personal tax of CHF 25 (see account a deduction of CHF 10,000 for each sample calculations on pages 11 and 12). The tax dependent. discount no longer applies starting 2010, as the 4 The tax base for calculating the IFD taxes into same base tax rate is now used for all taxpayers, account a deduction of CHF 2,600 from the net irrespective of their family situation. For a married income, applicable to married couples living in a couple living in a joint household, the rate applying joint household, as well as CHF 6,400 for each to their income is the rate equal to 50% of their dependent. income. The same applies to taxpayers who are single, widows or widowers, divorced, legally or de 5 As per the 2011 tax rates for ICC and 2011-post facto separated, and who live in a joint household tax rates for IFD with their minor or adult children or a family 6 Tax rates rounded to the nearest tenth. Tax 2012 Geneva Ernst & Young Ltd. 6
Individuals 1.2 Coefficients ________________________________________________________ Cantonal 47.5 ________________________________________________________ __________________________________________________________________________________________________________________________ Municipal __________________________________________________________________________________________________________________________ City of Geneva (provisional) 45.5 Gy 46 ........................................................................................... ........................................................................................... Aire-la-Ville 50 Hermance 42 ........................................................................................... ........................................................................................... Anières 33 Jussy 42 ........................................................................................... ........................................................................................... Avully 51 Laconnex 45 ........................................................................................... ........................................................................................... Avusy 50 Lancy 47 ........................................................................................... ........................................................................................... Bardonnex 41 Meinier 42 ........................................................................................... ........................................................................................... Bellevue 42 Meyrin 43 ........................................................................................... ........................................................................................... Bernex 48 Onex 50.5 ........................................................................................... ........................................................................................... Carouge 39 Perly-Certoux 43 ........................................................................................... ........................................................................................... Cartigny 41 Plan-les-Ouates 37 ........................................................................................... ........................................................................................... Céligny 33 Pregny-Chambésy 32 ........................................................................................... ........................................................................................... Chancy 51 Presinge 41 ........................................................................................... ........................................................................................... Chêne-Bougeries 34 Puplinge 46 ........................................................................................... ........................................................................................... Chêne-Bourg 46 Russin 42 ........................................................................................... ........................................................................................... Choulex 44 Satigny 39 ........................................................................................... ........................................................................................... Collex-Bossy 46 Soral 46 ........................................................................................... ........................................................................................... Collonge-Bellerive 30 Thônex 44 ........................................................................................... ........................................................................................... Cologny 31 Troinex 40 ........................................................................................... ........................................................................................... Confignon 47 Vandœuvres 31 ........................................................................................... ........................................................................................... Corsier 35 Vernier 50 ........................................................................................... ........................................................................................... Dardagny 48 Versoix 48 ........................................................................................... ........................................................................................... Genthod (provisional) 25 Veyrier 38 ........................................................................................... ........................................................................................... Grand-Saconnex 44 ........................................................................................... Community care surcharge : 1% (Coefficients 2012) Tax 2012 Geneva Ernst & Young Ltd. 7
Individuals 1.3 Privileged portion for the commune ........................................................................................... ........................................................................................... City of Geneva 27 % Gy 79 % ........................................................................................... ........................................................................................... Aire-la-Ville 80 % Hermance 53 % ........................................................................................... ........................................................................................... Anières 20 % Jussy 62 % ........................................................................................... ........................................................................................... Avully 80 % Laconnex 74 % ........................................................................................... ........................................................................................... Avusy 80 % Lancy 59 % ........................................................................................... ........................................................................................... Bardonnex 72 % Meinier 57 % ........................................................................................... ........................................................................................... Bellevue 59 % Meyrin 35 % ........................................................................................... ........................................................................................... Bernex 80 % Onex 80 % ........................................................................................... ........................................................................................... Carouge 25 % Perly-Certoux 58 % ........................................................................................... ........................................................................................... Cartigny 53 % Plan-les-Ouates 27 % ........................................................................................... ........................................................................................... Céligny 20 % Pregny-Chambésy 20 % ........................................................................................... ........................................................................................... Chancy 80 % Presinge 37 % ........................................................................................... ........................................................................................... Chêne-Bougeries 26 % Puplinge 74 % ........................................................................................... ........................................................................................... Chêne-Bourg 72 % Russin 78 % ........................................................................................... ........................................................................................... Choulex 56 % Satigny 26 % ........................................................................................... ........................................................................................... Collex-Bossy 80 % Soral 80 % ........................................................................................... ........................................................................................... Collonge-Bellerive 20 % Thônex 60 % ........................................................................................... ........................................................................................... Cologny 20 % Troinex 30 % ........................................................................................... ........................................................................................... Confignon 77 % Vandœuvres 20 % ........................................................................................... ........................................................................................... Corsier 28 % Vernier 80 % ........................................................................................... ........................................................................................... Dardagny 72 % Versoix 80 % ........................................................................................... ........................................................................................... Genthod 20 % Veyrier 39 % ........................................................................................... ........................................................................................... Grand-Saconnex 48 % ........................................................................................... (Privileged portion for the commune 2012) Tax 2012 Geneva Ernst & Young Ltd. 8
Individuals 1.4 Deductions __________________________________________________________________________________________________________________________ Related to gainful activities ICC IFD __________________________________________________________________________________________________________________________ Retirement pension and surviving dependents’ insurance (AVS) Disability insurance (AI) / Insurance for loss of earnings (APG) 100% 100% ...................................................................................................................................................................................................... Unemployment insurance (AC) 100% 100% ...................................................................................................................................................................................................... Accident insurance (AANP) 100% 100% ...................................................................................................................................................................................................... Maternity insurance (Amat) 100% 100% ...................................................................................................................................................................................................... Occupational pension (LPP) 100% 100% ...................................................................................................................................................................................................... 3rd pillar A 1 100% 100% ...................................................................................................................................................................................................... Joint income earners 2 500 min. 8,100 max. 13,200 ...................................................................................................................................................................................................... Travel expenses - 840 ...................................................................................................................................................................................................... Business and professional expenses min. 600 2,000 max. 1,700 4,000 ...................................................................................................................................................................................................... Meal costs - max. 3,200 ...................................................................................................................................................................................................... Costs for training, retraining or rehabilitation 100% 100% ...................................................................................................................................................................................................... Childcare costs max. 4,0003 max. 10,0004 ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Medical costs ICC IFD __________________________________________________________________________________________________________________________ Non-reimbursed medical costs in excess of 5% of net income - 100% Non-reimbursed medical costs in excess of 0.5% of net income 100% - ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Purchase of (missing) years of insurance ICC IFD __________________________________________________________________________________________________________________________ Subject to limits stipulated by Federal law5 100% 100% ...................................................................................................................................................................................................... 1 Subject to the limits stipulated by Federal law, CHF 6,682 given affiliation to the 2nd pillar and 20% year. The same deduction is granted to taxpayers of the determining income, but no more than CHF who are single, widows or widowers, divorced, le- 33,408 without affiliation to 2nd pillar. gally or de facto separated, and who are gainfully employed, and whose household includes minor 2 When the married couple lives in a joint household children who are in their care. and each is gainfully employed: ICC: An amount of CHF 500 is deducted from the lower salary. 4 An amount of at most CHF 1,000 per child whose IFD: 50% of the lower salary is deducted, between care is provided by a third-party is deducted from maximum and minimum amounts stated above. the income if the child is younger than 14 years of age and lives in the same household as the 3 Taxpayers who are married or in a registered part- taxpayer providing support for the child. nership and who are both gainfully employed may deduct effective and justified childcare costs up to 5 The maximum insured salary, which serves as the the amount of CHF 4,000 for each child less than basis of calculating the buy-back amount, may not 13 years of age as of 31 December of the fiscal exceed CHF 835,200. Tax 2012 Geneva Ernst & Young Ltd. 9
Individuals __________________________________________________________________________________________________________________________ Dependents ICC IFD __________________________________________________________________________________________________________________________ Per dependent child 10,000 6,500 ...................................................................................................................................................................................................... Per “other dependent”1 10,000 6,500 ...................................................................................................................................................................................................... Deduction for married couples - 2,600 ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Life insurance, return on savings ICC1 IFD2 __________________________________________________________________________________________________________________________ Single4 max. 2,200 1,700 ...................................................................................................................................................................................................... Married4 max. 3,300 3,500 ...................................................................................................................................................................................................... Per dependent4 max. 900 700 ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Others ICC IFD __________________________________________________________________________________________________________________________ Health and accident insurance 100% -3 ...................................................................................................................................................................................................... Donations equivalent to 20% of net taxable income 100% 100%5 ...................................................................................................................................................................................................... Alimony payments and additional dependents6 100% 100% ...................................................................................................................................................................................................... Interest on unsecured debts and mortgage debts 7 100% 100% ...................................................................................................................................................................................................... Interest on commercial debts 100% 100% ...................................................................................................................................................................................................... 1 Is considered an “other dependent” the ascend- ant, descendant (other than dependent child), brother, sister, uncle, aunt, nephew or niece who is unable to provide for himself/herself and whose wealth does not exceed CHF 87,500 and whose 4 The maximum deductions are applicable in the income does not exceed CHF 15,333 (full charge) event of payment of contributions to a 2nd pillar or CHF 23,000 (half-charge). The “other depend- or 3rd pillar A. ent” is considered a dependent for the taxpayer who provides assistance for the dependent. 5 rovided that these amount to at least CHF 100 P per year. 2 For ICC, life insurance premiums are added to interest from savings capital within the indicated 6 Paid to a former spouse, for the benefit of the lat- limits. ter and for minor children in the latter’s care, or to the other parent, in the case of minor children in 3 For IFD, life insurance premiums are added to the latter’s care born outside of the marriage. interest from savings capital, without restriction, then added to health and accident insurance 7 rivate debts are deductible up to the gross return P premiums within the limits indicated. from the assets, plus CHF 50,000. Tax 2012 Geneva Ernst & Young Ltd. 10
Individuals 1.5 Sample calculations1 Married taxpayer, without dependents, with net income of CHF 150,000. I. Workplace and residence in the same municipality (City of Geneva) __________________________________________________________________________________________________________________________ IFD __________________________________________________________________________________________________________________________ IFD tax (as per 1.1) 5,724 __________________________________________________________________________________________________________________________ __________________________________________________________________________________________________________________________ ICC __________________________________________________________________________________________________________________________ Basic tax 15,432 ...................................................................................................................................................................................................... 12% reduction on the basic tax (1,852). ...................................................................................................................................................................................................... Cantonal coefficient (base tax x coefficient as per 1.2) 15,432 × 47.5% 7,330 ...................................................................................................................................................................................................... Community care surcharge 15,432 × 1% 154 ...................................................................................................................................................................................................... 12% reduction on cantonal coefficient 7,330 × 12% (879) __________________________________________________________________________________________________________________________ Total impôts cantonaux sur le revenu 20,185 __________________________________________________________________________________________________________________________ Privileged share for Geneva, 27% of base tax rate (15,432 × 27%) × 45.5% 1,896 ...................................................................................................................................................................................................... Municipal coefficient Geneva (15,432 × 73%) × 45.5% 5,126 __________________________________________________________________________________________________________________________ Total municipal taxes on income 7,022 __________________________________________________________________________________________________________________________ Personal tax2 25 __________________________________________________________________________________________________________________________ Total ICC (as per 1.1) 27,332 __________________________________________________________________________________________________________________________ Total tax expense (ICC and IFD) 33,956 __________________________________________________________________________________________________________________________ % Total tax expense (ICC and IFD)3 22.0% ...................................................................................................................................................................................................... 1 Estimations calculated by Ernst & Young SA. 2 CHF 25 paid per taxpayer or per couple living a joint household. 3 As per the 2012 tax rates for ICC and 2012-post tax rates for IFD Tax 2012 Geneva Ernst & Young Ltd. 11
Individuals II. Workplace and residence in different municipalities (City of Geneva / Cologny) __________________________________________________________________________________________________________________________ IFD __________________________________________________________________________________________________________________________ IFD tax (as per 1.1) 5,724 __________________________________________________________________________________________________________________________ __________________________________________________________________________________________________________________________ ICC __________________________________________________________________________________________________________________________ Basic tax 15,432 12% reduction on the basic tax (1,852). ...................................................................................................................................................................................................... Cantonal coefficient (base tax × coefficient as per 1.2) 15,432 × 47.5% 7,330 ...................................................................................................................................................................................................... Community care surcharge 15,432 × 1% 154 ...................................................................................................................................................................................................... 12% reduction on cantonal coefficient 7,330 × 12% (879) __________________________________________________________________________________________________________________________ Total cantonal taxes on income 20,185 __________________________________________________________________________________________________________________________ Privileged share for Geneva, 31% on 20% base tax rate (15,432 × 20%) × 31% 957. ...................................................................................................................................................................................................... Municipal coefficient Geneva (15,432 × 80%) × 31% 3,827 __________________________________________________________________________________________________________________________ Total municipal taxes on income 4,784 __________________________________________________________________________________________________________________________ Personal tax1 25 __________________________________________________________________________________________________________________________ Total ICC (as per 1.1) 24,994 __________________________________________________________________________________________________________________________ Total tax expense (ICC and IFD) 30,718 __________________________________________________________________________________________________________________________ % Total tax expense (ICC and IFD)2 20.50% ...................................................................................................................................................................................................... 1 CHF 25 paid per taxpayer or per couple living a joint household. 2 As per the 2012 tax rates for ICC and 2012-post tax rates for IFD Tax 2012 Geneva Ernst & Young Ltd. 12
Individuals 1.6 Source tax I. Gainful activity __________________________________________________________________________________________________________________________ Taxable Single Married Married Married income2 1 child1 2 children1 __________________________________________________________________________________________________________________________ 25,000 - - - - ...................................................................................................................................................................................................... 50,000 3,625 40 - - ...................................................................................................................................................................................................... 75,000 9,465 2,843 743 - ...................................................................................................................................................................................................... 100,000 16,060 8,100 5,140 2,490 ...................................................................................................................................................................................................... 125,000 23,375 14,475 11,013 7,750 ...................................................................................................................................................................................................... 150,000 31,230 21,510 17,865 14,250 ...................................................................................................................................................................................................... 175,000 39,638 29,173 25,323 21,560 ...................................................................................................................................................................................................... 200,000 48,400 37,960 33,740 29,580 ...................................................................................................................................................................................................... 250,000 67,100 55,750 51,525 47,275 ...................................................................................................................................................................................................... 300,000 86,280 73,770 69,450 65,220 ...................................................................................................................................................................................................... 400,000 126,000 110,560 106,160 101,760 ...................................................................................................................................................................................................... 500,000 166,450 148,700 144,200 139,700 ...................................................................................................................................................................................................... 1,000,000 370,700 346,800 341,900 337,100 __________________________________________________________________________________________________________________________ Max. rate 37.07% 34.68% 34.19% 33.71% __________________________________________________________________________________________________________________________ __________________________________________________________________________________________________________________________ Deductions2 ICC IFD __________________________________________________________________________________________________________________________ Purchase of missing pension years (LPP)3 100% 100% ...................................................................................................................................................................................................... 3rd pillar A 3 100% 100% ...................................................................................................................................................................................................... Additional dependent costs 100% 100% ...................................................................................................................................................................................................... Alimony payments 100% 100% ...................................................................................................................................................................................................... Childcare costs4 100% 100% ...................................................................................................................................................................................................... Withholding tax (for Geneva residents) 100% 100% ...................................................................................................................................................................................................... Effective costs (quasi-resident status) 5 100% 100% ...................................................................................................................................................................................................... (2012 tax rates) 1 Minor child(ren) or major children who are in school, who are less than 25 years of age on of the fiscal year. The same deduction is granted 31 December of the year in question, and if their to taxpayers who are single, widows or widowers, assets do not exceed CHF 87,500 divorced, legally or de facto separated, and who are gainfully employed, and whose household 2 These deductions may not be applied by the party includes minor children who are in their care. liable for the taxable benefit (employer, insurer, etc.), but instead a claim for them must be sub- 5 In a leading case on 26 January 2010, the Federal mitted by the taxpayer. Supreme Court stipulated that a person paying withholding tax should benefit from the same 3 Subject to the limits stipulated by Federal law. system of tax deductions as a taxpayer subject to 4 Taxpayers who are married or in a registered ordinary taxation, subject to certain conditions. partnership and who are both gainfully employed The taxpayers concerned will be able to request may deduct effective and documented childcare the deduction of their effective costs instead of costs up to the amount of CHF 4,000 for each the flat rates included in the source tax rate by child less than 13 years of age as of 31 December filing an annual tax return. Tax 2012 Geneva Ernst & Young Ltd. 13
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Tax 2012 Geneva

  • 1. Tax 2012 Geneva t
  • 2. Table of contents _______________________________________________________________________________________ _______________________________________________________________________________________ Individuals 4 Corporate 21 ............................................................................................................................................ ............................................................................................................................................ 1 Income 5 7 Profit 22 1.1 Rates 5 7.1 Tax rates 22 1.2 Coefficients 7 7.2 Sample calculation for the City of Geneva 22 1.3 Privileged portion for the commune 8 7.3 Statutory cantonal and municipal rates 2012 (profits) 23 1.4 Deductions 9 7.4 Losses carried forward 24 1.5 Sample calculations 11 7.5 Lump-sum provisions 24 1.6 Source tax 13 7.6 Depreciations (declining balance/straight line) 25 ............................................................................................................................................ 7.7 Participation deduction relief 25 2 Wealth 15 ............................................................................................................................................ ............................................................................................................................................ 8 Capital 26 3 Interest rates (on debts and tax liabilities) 17 ............................................................................................................................................ 8.1 Tax rates 26 4 Social security and occupational pension provision 17 8.2 Sample calculations for the City of Geneva 27 ............................................................................................................................................ 8.3 Statutory cantonal and municipal rates 2012 (capital) 28 5 Donations and successions 18 ............................................................................................................................................ 8.4 Thin capitalization 29 ............................................................................................................................................ 6 Real estate 20 9 Professional communal tax 30 ............................................................................................................................................ 10 Withholding tax 31 ............................................................................................................................................ 11 Stamp duties 32 ............................................................................................................................................ 12 Interest rates (on tax receivables and payables) 33 ............................................................................................................................................ 13 VAT 34 ............................................................................................................................................ 14 Real estate 35 ............................................................................................................................................ 15 Agreement on the Taxation of Savings between Switzerland and the European Union 36 ............................................................................................................................................ 16 Double taxation agreements (as at 1 January 2012) 37 _______________________________________________________________________________________ Your contacts 40 Tax 2012 Geneva Ernst & Young Ltd. 2
  • 3. Tax 2012 Geneva The information in this brochure gives a general overview of taxation at federal level and in the canton of Geneva. It is aimed at readers with a sound knowledge of Swiss tax law and of the relevant legislation in Geneva and is intended as a source of reference material. This article does not claim to be exhaustive and cannot in any way be a substitute for the advice of a taxation expert. It discusses common law rather than exceptions to it or optimal tax planning. IFD : Direct Federal Tax IC : Cantonal Tax ICC : Cantonal and Municipal Tax CHF : All amounts are in Swiss francs July 2012 Tax 2012 Geneva Ernst & Young Ltd. 3
  • 4. Individuals Tax 2012 Geneva Ernst & Young Ltd. 4
  • 5. Individuals 1 Income 1.1 Rates Single taxpayer, without dependents, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD Total Tax Overall tax4, 5 Income Tax Tax ICC2 __________________________________________________________________________________________________________________________ 5,000 2 830 289 1,144 81 1,225 4.9% ...................................................................................................................................................................................................... 50,000 5,179 1,802 7,006 445 7,451 14.9% ...................................................................................................................................................................................................... 75,000 10,093 3,511 13,629 1,245 14,874 19.8% ...................................................................................................................................................................................................... 100,000 15,161 5,274 20,460 2,874 23,334 23.3% ...................................................................................................................................................................................................... 125,000 20,259 7,047 27,331 4,955 32,326 25.9% ...................................................................................................................................................................................................... 150,000 25,491 8,867 34,383 7,534 42,917 27.9% ...................................................................................................................................................................................................... 175,000 30,806 10,716 41,547 10,284 51,831 29.6% ...................................................................................................................................................................................................... 200,000 36,309 12,631 48,965 13,562 62,527 31.3% ...................................................................................................................................................................................................... 250,000 47,427 16,498 63,950 20,162 84,112 33.6% ...................................................................................................................................................................................................... 300,000 58,924 20,497 79,446 26,762 106,208 35.4% ...................................................................................................................................................................................................... 400,000 82,509 28,701 111,235 39,962 151,197 37.8% ...................................................................................................................................................................................................... 500,000 106,707 37,119 143,851 53,162 197,013 39.4% ...................................................................................................................................................................................................... 1 ,000,000 230,203 80,078 310 306 115,000 425,306 42.5% ...................................................................................................................................................................................................... Married taxpayer, without dependents, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD3 Total Tax Overall tax4, 5 Income Tax Tax ICC2 __________________________________________________________________________________________________________________________ 25,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 50,000 1,660 578 2,263 191 2,454 4.9% ...................................................................................................................................................................................................... 75,000 5,616 1,954 7,595 796 8,391 11.2% ...................................................................................................................................................................................................... 100,000 10,358 3,603 13,986 1,838 15,824 15.8% ...................................................................................................................................................................................................... 125,000 15,263 5,309 20,597 3,355 23,952 19.2% ...................................................................................................................................................................................................... 150,000 20,185 7,022 27,232 5,724 32,956 22.0% ...................................................................................................................................................................................................... 175,000 25,254 8,785 34,064 8,974 43,038 24.6% ...................................................................................................................................................................................................... 200,000 30,322 10,548 40,895 12,224 53,119 26.6% ...................................................................................................................................................................................................... 250,000 40,517 14,094 54,636 18,724 73,360 29.3% ...................................................................................................................................................................................................... 300,000 50,981 17,734 68,740 25,224 93,964 31.3% ...................................................................................................................................................................................................... 400,000 72,619 25,261 97,905 38,224 136,129 34.0% ...................................................................................................................................................................................................... 500,000 94,855 32,996 127,876 51,224 179,100 35.8% ...................................................................................................................................................................................................... 1 ,000,000 213,414 74,238 287,677 114,701 402,378 40.2% ...................................................................................................................................................................................................... are single, widows or widowers, divorced, legally 1 Estimations calculated by Ernst & Young Ltd. or de facto separated, and who live in a joint 2 The total ICC includes the basic cantonal tax, the household with their minor or adult children or a reduction of 12%, the additional cantonal and family member constituting a dependent for whom municipal coefficients, the additional charge for the taxpayer is the primarily provider of support. the city of Geneva and the personal tax of CHF 25 3 The tax base for calculating the IFD taxes take into (see sample calculations on pages 11 and 12). account a deduction of CHF 2,600 from the net The tax discount no longer applies starting 2010, income, applicable to married couples living in a as the same base tax rate is now used for all tax- joint household. payers, irrespective of their family situation. For a married couple living in a joint household, the rate 4 As per the 2011 tax rates for ICC and 2011-post applying to their income is the rate equal to 50% of tax rates for IFD their income. The same applies to taxpayers who 5 Tax rates rounded to the nearest tenth. Tax 2012 Geneva Ernst & Young Ltd. 5
  • 6. Individuals Married taxpayer, one dependent, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD4 Total Tax Overall tax5, 6 Income Tax Tax ICC2, 3 __________________________________________________________________________________________________________________________ 25,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 50,000 478 166 669 - 669 1.3% ...................................................................................................................................................................................................... 75,000 3,927 1,366 5,318 350 5,668 7.6% ...................................................................................................................................................................................................... 100,000 8,407 2,925 11,357 1,262 12,619 12.6% ...................................................................................................................................................................................................... 125,000 13,301 4,627 17,953 2,649 20,602 16.5% ...................................................................................................................................................................................................... 150,000 18,206 6,333 24,564 4,694 29,258 19.5% ...................................................................................................................................................................................................... 175,000 23,227 8,080 31,332 7,878 39,210 22.4% ...................................................................................................................................................................................................... 200,000 28,295 9,843 38,163 11,128 49,291 24.6% ...................................................................................................................................................................................................... 250,000 38,432 13,369 51,826 17,628 69,454 27.8% ...................................................................................................................................................................................................... 300,000 48,888 17,006 65,919 24,128 90,047 30.0% ...................................................................................................................................................................................................... 400,000 70,395 24,488 94,908 37,128 132,036 33.0% ...................................................................................................................................................................................................... 500,000 92,631 32,223 124,879 50,128 175,007 35.0% ...................................................................................................................................................................................................... 1 ,000,000 210,994 73,396 284,415 113,703 398,118 39.8% ...................................................................................................................................................................................................... Married taxpayer, two dependents, resident in the Municipality of Geneva1 : __________________________________________________________________________________________________________________________ Net Cantonal Municipal Total IFD4 Total Tax Overall tax5, 6 Income Tax Tax ICC2, 3 __________________________________________________________________________________________________________________________ 25,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 50,000 - - 25 - 25 0.1% ...................................................................................................................................................................................................... 75,000 2,364 822 3,211 - 3,211 4.3% ...................................................................................................................................................................................................... 100,000 6,532 2,272 8,829 745 9,574 9.6% ...................................................................................................................................................................................................... 125,000 11,339 3,944 15,308 1,996 17,304 13.8% ...................................................................................................................................................................................................... 150,000 16,244 5,650 21,919 3,822 25,741 17.2% ...................................................................................................................................................................................................... 175,000 21,199 7,374 28,598 6,782 35,380 20.2% ...................................................................................................................................................................................................... 200,000 26,268 9,137 35,430 10,032 45,462 22.7% ...................................................................................................................................................................................................... 250,000 36,405 12,664 49,094 16,532 65,626 26.3% ...................................................................................................................................................................................................... 300,000 46,796 16,278 63,099 23,032 86,131 28.7% ...................................................................................................................................................................................................... 400,000 68,172 23,714 91,911 36,032 127,943 32.0% ...................................................................................................................................................................................................... 500,000 90,408 31,449 121,882 49,032 170,914 34.2% ...................................................................................................................................................................................................... 1 ,000,000 208,574 72,554 281,153 112,704 393,857 39.4% ...................................................................................................................................................................................................... 1 Estimations calculated by Ernst & Young Ltd.. member constituting a dependent for whom the 2 The total ICC includes the basic cantonal tax, the taxpayer is the primarily provider of support. reduction of 12%, additional cantonal and munici- pal coefficients , the additional charge for the city 3 The tax base for calculating the ICC takes into of Geneva and the personal tax of CHF 25 (see account a deduction of CHF 10,000 for each sample calculations on pages 11 and 12). The tax dependent. discount no longer applies starting 2010, as the 4 The tax base for calculating the IFD taxes into same base tax rate is now used for all taxpayers, account a deduction of CHF 2,600 from the net irrespective of their family situation. For a married income, applicable to married couples living in a couple living in a joint household, the rate applying joint household, as well as CHF 6,400 for each to their income is the rate equal to 50% of their dependent. income. The same applies to taxpayers who are single, widows or widowers, divorced, legally or de 5 As per the 2011 tax rates for ICC and 2011-post facto separated, and who live in a joint household tax rates for IFD with their minor or adult children or a family 6 Tax rates rounded to the nearest tenth. Tax 2012 Geneva Ernst & Young Ltd. 6
  • 7. Individuals 1.2 Coefficients ________________________________________________________ Cantonal 47.5 ________________________________________________________ __________________________________________________________________________________________________________________________ Municipal __________________________________________________________________________________________________________________________ City of Geneva (provisional) 45.5 Gy 46 ........................................................................................... ........................................................................................... Aire-la-Ville 50 Hermance 42 ........................................................................................... ........................................................................................... Anières 33 Jussy 42 ........................................................................................... ........................................................................................... Avully 51 Laconnex 45 ........................................................................................... ........................................................................................... Avusy 50 Lancy 47 ........................................................................................... ........................................................................................... Bardonnex 41 Meinier 42 ........................................................................................... ........................................................................................... Bellevue 42 Meyrin 43 ........................................................................................... ........................................................................................... Bernex 48 Onex 50.5 ........................................................................................... ........................................................................................... Carouge 39 Perly-Certoux 43 ........................................................................................... ........................................................................................... Cartigny 41 Plan-les-Ouates 37 ........................................................................................... ........................................................................................... Céligny 33 Pregny-Chambésy 32 ........................................................................................... ........................................................................................... Chancy 51 Presinge 41 ........................................................................................... ........................................................................................... Chêne-Bougeries 34 Puplinge 46 ........................................................................................... ........................................................................................... Chêne-Bourg 46 Russin 42 ........................................................................................... ........................................................................................... Choulex 44 Satigny 39 ........................................................................................... ........................................................................................... Collex-Bossy 46 Soral 46 ........................................................................................... ........................................................................................... Collonge-Bellerive 30 Thônex 44 ........................................................................................... ........................................................................................... Cologny 31 Troinex 40 ........................................................................................... ........................................................................................... Confignon 47 Vandœuvres 31 ........................................................................................... ........................................................................................... Corsier 35 Vernier 50 ........................................................................................... ........................................................................................... Dardagny 48 Versoix 48 ........................................................................................... ........................................................................................... Genthod (provisional) 25 Veyrier 38 ........................................................................................... ........................................................................................... Grand-Saconnex 44 ........................................................................................... Community care surcharge : 1% (Coefficients 2012) Tax 2012 Geneva Ernst & Young Ltd. 7
  • 8. Individuals 1.3 Privileged portion for the commune ........................................................................................... ........................................................................................... City of Geneva 27 % Gy 79 % ........................................................................................... ........................................................................................... Aire-la-Ville 80 % Hermance 53 % ........................................................................................... ........................................................................................... Anières 20 % Jussy 62 % ........................................................................................... ........................................................................................... Avully 80 % Laconnex 74 % ........................................................................................... ........................................................................................... Avusy 80 % Lancy 59 % ........................................................................................... ........................................................................................... Bardonnex 72 % Meinier 57 % ........................................................................................... ........................................................................................... Bellevue 59 % Meyrin 35 % ........................................................................................... ........................................................................................... Bernex 80 % Onex 80 % ........................................................................................... ........................................................................................... Carouge 25 % Perly-Certoux 58 % ........................................................................................... ........................................................................................... Cartigny 53 % Plan-les-Ouates 27 % ........................................................................................... ........................................................................................... Céligny 20 % Pregny-Chambésy 20 % ........................................................................................... ........................................................................................... Chancy 80 % Presinge 37 % ........................................................................................... ........................................................................................... Chêne-Bougeries 26 % Puplinge 74 % ........................................................................................... ........................................................................................... Chêne-Bourg 72 % Russin 78 % ........................................................................................... ........................................................................................... Choulex 56 % Satigny 26 % ........................................................................................... ........................................................................................... Collex-Bossy 80 % Soral 80 % ........................................................................................... ........................................................................................... Collonge-Bellerive 20 % Thônex 60 % ........................................................................................... ........................................................................................... Cologny 20 % Troinex 30 % ........................................................................................... ........................................................................................... Confignon 77 % Vandœuvres 20 % ........................................................................................... ........................................................................................... Corsier 28 % Vernier 80 % ........................................................................................... ........................................................................................... Dardagny 72 % Versoix 80 % ........................................................................................... ........................................................................................... Genthod 20 % Veyrier 39 % ........................................................................................... ........................................................................................... Grand-Saconnex 48 % ........................................................................................... (Privileged portion for the commune 2012) Tax 2012 Geneva Ernst & Young Ltd. 8
  • 9. Individuals 1.4 Deductions __________________________________________________________________________________________________________________________ Related to gainful activities ICC IFD __________________________________________________________________________________________________________________________ Retirement pension and surviving dependents’ insurance (AVS) Disability insurance (AI) / Insurance for loss of earnings (APG) 100% 100% ...................................................................................................................................................................................................... Unemployment insurance (AC) 100% 100% ...................................................................................................................................................................................................... Accident insurance (AANP) 100% 100% ...................................................................................................................................................................................................... Maternity insurance (Amat) 100% 100% ...................................................................................................................................................................................................... Occupational pension (LPP) 100% 100% ...................................................................................................................................................................................................... 3rd pillar A 1 100% 100% ...................................................................................................................................................................................................... Joint income earners 2 500 min. 8,100 max. 13,200 ...................................................................................................................................................................................................... Travel expenses - 840 ...................................................................................................................................................................................................... Business and professional expenses min. 600 2,000 max. 1,700 4,000 ...................................................................................................................................................................................................... Meal costs - max. 3,200 ...................................................................................................................................................................................................... Costs for training, retraining or rehabilitation 100% 100% ...................................................................................................................................................................................................... Childcare costs max. 4,0003 max. 10,0004 ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Medical costs ICC IFD __________________________________________________________________________________________________________________________ Non-reimbursed medical costs in excess of 5% of net income - 100% Non-reimbursed medical costs in excess of 0.5% of net income 100% - ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Purchase of (missing) years of insurance ICC IFD __________________________________________________________________________________________________________________________ Subject to limits stipulated by Federal law5 100% 100% ...................................................................................................................................................................................................... 1 Subject to the limits stipulated by Federal law, CHF 6,682 given affiliation to the 2nd pillar and 20% year. The same deduction is granted to taxpayers of the determining income, but no more than CHF who are single, widows or widowers, divorced, le- 33,408 without affiliation to 2nd pillar. gally or de facto separated, and who are gainfully employed, and whose household includes minor 2 When the married couple lives in a joint household children who are in their care. and each is gainfully employed: ICC: An amount of CHF 500 is deducted from the lower salary. 4 An amount of at most CHF 1,000 per child whose IFD: 50% of the lower salary is deducted, between care is provided by a third-party is deducted from maximum and minimum amounts stated above. the income if the child is younger than 14 years of age and lives in the same household as the 3 Taxpayers who are married or in a registered part- taxpayer providing support for the child. nership and who are both gainfully employed may deduct effective and justified childcare costs up to 5 The maximum insured salary, which serves as the the amount of CHF 4,000 for each child less than basis of calculating the buy-back amount, may not 13 years of age as of 31 December of the fiscal exceed CHF 835,200. Tax 2012 Geneva Ernst & Young Ltd. 9
  • 10. Individuals __________________________________________________________________________________________________________________________ Dependents ICC IFD __________________________________________________________________________________________________________________________ Per dependent child 10,000 6,500 ...................................................................................................................................................................................................... Per “other dependent”1 10,000 6,500 ...................................................................................................................................................................................................... Deduction for married couples - 2,600 ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Life insurance, return on savings ICC1 IFD2 __________________________________________________________________________________________________________________________ Single4 max. 2,200 1,700 ...................................................................................................................................................................................................... Married4 max. 3,300 3,500 ...................................................................................................................................................................................................... Per dependent4 max. 900 700 ...................................................................................................................................................................................................... __________________________________________________________________________________________________________________________ Others ICC IFD __________________________________________________________________________________________________________________________ Health and accident insurance 100% -3 ...................................................................................................................................................................................................... Donations equivalent to 20% of net taxable income 100% 100%5 ...................................................................................................................................................................................................... Alimony payments and additional dependents6 100% 100% ...................................................................................................................................................................................................... Interest on unsecured debts and mortgage debts 7 100% 100% ...................................................................................................................................................................................................... Interest on commercial debts 100% 100% ...................................................................................................................................................................................................... 1 Is considered an “other dependent” the ascend- ant, descendant (other than dependent child), brother, sister, uncle, aunt, nephew or niece who is unable to provide for himself/herself and whose wealth does not exceed CHF 87,500 and whose 4 The maximum deductions are applicable in the income does not exceed CHF 15,333 (full charge) event of payment of contributions to a 2nd pillar or CHF 23,000 (half-charge). The “other depend- or 3rd pillar A. ent” is considered a dependent for the taxpayer who provides assistance for the dependent. 5 rovided that these amount to at least CHF 100 P per year. 2 For ICC, life insurance premiums are added to interest from savings capital within the indicated 6 Paid to a former spouse, for the benefit of the lat- limits. ter and for minor children in the latter’s care, or to the other parent, in the case of minor children in 3 For IFD, life insurance premiums are added to the latter’s care born outside of the marriage. interest from savings capital, without restriction, then added to health and accident insurance 7 rivate debts are deductible up to the gross return P premiums within the limits indicated. from the assets, plus CHF 50,000. Tax 2012 Geneva Ernst & Young Ltd. 10
  • 11. Individuals 1.5 Sample calculations1 Married taxpayer, without dependents, with net income of CHF 150,000. I. Workplace and residence in the same municipality (City of Geneva) __________________________________________________________________________________________________________________________ IFD __________________________________________________________________________________________________________________________ IFD tax (as per 1.1) 5,724 __________________________________________________________________________________________________________________________ __________________________________________________________________________________________________________________________ ICC __________________________________________________________________________________________________________________________ Basic tax 15,432 ...................................................................................................................................................................................................... 12% reduction on the basic tax (1,852). ...................................................................................................................................................................................................... Cantonal coefficient (base tax x coefficient as per 1.2) 15,432 × 47.5% 7,330 ...................................................................................................................................................................................................... Community care surcharge 15,432 × 1% 154 ...................................................................................................................................................................................................... 12% reduction on cantonal coefficient 7,330 × 12% (879) __________________________________________________________________________________________________________________________ Total impôts cantonaux sur le revenu 20,185 __________________________________________________________________________________________________________________________ Privileged share for Geneva, 27% of base tax rate (15,432 × 27%) × 45.5% 1,896 ...................................................................................................................................................................................................... Municipal coefficient Geneva (15,432 × 73%) × 45.5% 5,126 __________________________________________________________________________________________________________________________ Total municipal taxes on income 7,022 __________________________________________________________________________________________________________________________ Personal tax2 25 __________________________________________________________________________________________________________________________ Total ICC (as per 1.1) 27,332 __________________________________________________________________________________________________________________________ Total tax expense (ICC and IFD) 33,956 __________________________________________________________________________________________________________________________ % Total tax expense (ICC and IFD)3 22.0% ...................................................................................................................................................................................................... 1 Estimations calculated by Ernst & Young SA. 2 CHF 25 paid per taxpayer or per couple living a joint household. 3 As per the 2012 tax rates for ICC and 2012-post tax rates for IFD Tax 2012 Geneva Ernst & Young Ltd. 11
  • 12. Individuals II. Workplace and residence in different municipalities (City of Geneva / Cologny) __________________________________________________________________________________________________________________________ IFD __________________________________________________________________________________________________________________________ IFD tax (as per 1.1) 5,724 __________________________________________________________________________________________________________________________ __________________________________________________________________________________________________________________________ ICC __________________________________________________________________________________________________________________________ Basic tax 15,432 12% reduction on the basic tax (1,852). ...................................................................................................................................................................................................... Cantonal coefficient (base tax × coefficient as per 1.2) 15,432 × 47.5% 7,330 ...................................................................................................................................................................................................... Community care surcharge 15,432 × 1% 154 ...................................................................................................................................................................................................... 12% reduction on cantonal coefficient 7,330 × 12% (879) __________________________________________________________________________________________________________________________ Total cantonal taxes on income 20,185 __________________________________________________________________________________________________________________________ Privileged share for Geneva, 31% on 20% base tax rate (15,432 × 20%) × 31% 957. ...................................................................................................................................................................................................... Municipal coefficient Geneva (15,432 × 80%) × 31% 3,827 __________________________________________________________________________________________________________________________ Total municipal taxes on income 4,784 __________________________________________________________________________________________________________________________ Personal tax1 25 __________________________________________________________________________________________________________________________ Total ICC (as per 1.1) 24,994 __________________________________________________________________________________________________________________________ Total tax expense (ICC and IFD) 30,718 __________________________________________________________________________________________________________________________ % Total tax expense (ICC and IFD)2 20.50% ...................................................................................................................................................................................................... 1 CHF 25 paid per taxpayer or per couple living a joint household. 2 As per the 2012 tax rates for ICC and 2012-post tax rates for IFD Tax 2012 Geneva Ernst & Young Ltd. 12
  • 13. Individuals 1.6 Source tax I. Gainful activity __________________________________________________________________________________________________________________________ Taxable Single Married Married Married income2 1 child1 2 children1 __________________________________________________________________________________________________________________________ 25,000 - - - - ...................................................................................................................................................................................................... 50,000 3,625 40 - - ...................................................................................................................................................................................................... 75,000 9,465 2,843 743 - ...................................................................................................................................................................................................... 100,000 16,060 8,100 5,140 2,490 ...................................................................................................................................................................................................... 125,000 23,375 14,475 11,013 7,750 ...................................................................................................................................................................................................... 150,000 31,230 21,510 17,865 14,250 ...................................................................................................................................................................................................... 175,000 39,638 29,173 25,323 21,560 ...................................................................................................................................................................................................... 200,000 48,400 37,960 33,740 29,580 ...................................................................................................................................................................................................... 250,000 67,100 55,750 51,525 47,275 ...................................................................................................................................................................................................... 300,000 86,280 73,770 69,450 65,220 ...................................................................................................................................................................................................... 400,000 126,000 110,560 106,160 101,760 ...................................................................................................................................................................................................... 500,000 166,450 148,700 144,200 139,700 ...................................................................................................................................................................................................... 1,000,000 370,700 346,800 341,900 337,100 __________________________________________________________________________________________________________________________ Max. rate 37.07% 34.68% 34.19% 33.71% __________________________________________________________________________________________________________________________ __________________________________________________________________________________________________________________________ Deductions2 ICC IFD __________________________________________________________________________________________________________________________ Purchase of missing pension years (LPP)3 100% 100% ...................................................................................................................................................................................................... 3rd pillar A 3 100% 100% ...................................................................................................................................................................................................... Additional dependent costs 100% 100% ...................................................................................................................................................................................................... Alimony payments 100% 100% ...................................................................................................................................................................................................... Childcare costs4 100% 100% ...................................................................................................................................................................................................... Withholding tax (for Geneva residents) 100% 100% ...................................................................................................................................................................................................... Effective costs (quasi-resident status) 5 100% 100% ...................................................................................................................................................................................................... (2012 tax rates) 1 Minor child(ren) or major children who are in school, who are less than 25 years of age on of the fiscal year. The same deduction is granted 31 December of the year in question, and if their to taxpayers who are single, widows or widowers, assets do not exceed CHF 87,500 divorced, legally or de facto separated, and who are gainfully employed, and whose household 2 These deductions may not be applied by the party includes minor children who are in their care. liable for the taxable benefit (employer, insurer, etc.), but instead a claim for them must be sub- 5 In a leading case on 26 January 2010, the Federal mitted by the taxpayer. Supreme Court stipulated that a person paying withholding tax should benefit from the same 3 Subject to the limits stipulated by Federal law. system of tax deductions as a taxpayer subject to 4 Taxpayers who are married or in a registered ordinary taxation, subject to certain conditions. partnership and who are both gainfully employed The taxpayers concerned will be able to request may deduct effective and documented childcare the deduction of their effective costs instead of costs up to the amount of CHF 4,000 for each the flat rates included in the source tax rate by child less than 13 years of age as of 31 December filing an annual tax return. Tax 2012 Geneva Ernst & Young Ltd. 13