Switzerland remains one of the most attractive destinations for Ultra High Net Worth Individuals (UHNWIs) looking to relocate. Among the many advantages it offers, the lump-sum tax system is a standout feature, enabling families and individuals to plan their financial future with confidence.
In the second episode of our series Why Families Choose Switzerland: Life, Taxes, and Opportunities, Annabelle Common, head of alpine sales at Naef Prestige | Knight Frank, and tax attorney Fouad G. Sayegh, dive into the mechanics of this unique tax regime.
Key Features of Lump-Sum Taxation
- Tax based on expenses: Unlike traditional income or wealth taxes, lump-sum taxation is calculated on the estimated annual expenses of the individual and their family.
- Predictability through negotiation: Before relocating, individuals negotiate their tax basis with the Swiss tax administration, ensuring transparency and stability.
- Low capital gains tax: While there is no capital gains tax on stocks or movable assets, real estate gains are taxed at relatively low rates, which vary by canton.
Additional tax benefits in Switzerland
- No inheritance tax in many cantons.
- Favorable conditions for long-term real estate ownership.
Why Consider lump-sum taxation?
This system offers UHNWIs a tailored approach to taxation, aligning financial obligations with lifestyle choices. By negotiating directly with the tax authorities, individuals gain clarity on their obligations and can focus on enjoying the many advantages Switzerland has to offer.
At Naef Prestige | Knight Frank, we specialize in guiding our clients through this process, ensuring they understand every step.
For more insights, follow our series Why Families Choose Switzerland: Life, Taxes, and Opportunities, and reach out for personalized advice on making Switzerland your new home.