Friday, October 22, 2010

That will be 40K please

Dear taxpayer,

That will be CHF 40,000 ($40,000). Please pay by tomorrow. In cash.


Ok. That's not exactly how Swiss taxes go, but essentially, you get a bill from the tax man for a staggering amount and are expected to hurry up and go transfer the money to them asap upon receiving your bill. Taxes are not deducted directly from paychecks in Switzerland, Swiss residents are expected to save part of their paychecks for the big tax bill that comes later, once a year.

Can you imagine this working in the United States? Please. The budget deficit is bad enough.


M'dame Jo said...

Actually, it depends on... the Kanton!

You didn't see it coming, did you? ;-)

In Vaud, you get one bill that represents an estimate of what you will earn over the year, which you can pay right away, but you also get 12 bills, with monthly deadlines, same estimate divided by 12 (duh). It used to be 9 bills, starting from April, but people complained (enough) that it'd be much easier to make their monthly budget otherwise, so now it's 12. Yeah.

The estimate is done every year based on your previous earnings. It used to be every two years - so nice if you have a change of personal situation. Again, enough complaining worked, it's now done every year.

I find quite surprising that some Kantons allow paying at the end of the year...

Oh, one more thing. So, I pay my taxes in advances, either in one time, or in 12.

Let's assume I paid too much: I can't get the money back (unless I insist A LOT and write LOTS of letters), it will be deducted from my next bills next year - not like anyone could use having their money now.

But if I didn't pay enough - which wouldn't be entirely my fault: I didn't do the estimate, did I? - I have 30 days to pay the difference with interests. This is my personal favorite.

Lovely, huh?

Chantal said...

Oh well, with taxes nothing is complicated enough. The point is that many Americans would never be able to pay large tax bills on their own. They can't even figure out how much house they can afford.

That's quite the joke. At least about the interest and them not giving you the money back. Yeah, you can pay the estimated taxes ahead of time, based on last year's pay, but we never do this since we are double taxed and have to consider two countries worth of tax. Talk about complicated!

M'dame Jo said...

Oh right, you have to pay taxes as an american living abroad, haven't you? This is an even better joke...

Romy said...

The only good thing about them keeping your money if you paid too much is that while it's sitting there until next year it collects 2% interest... lots more than in a bank. If you can afford it it's worthwhile to totally overpay your taxes for that interest rate alone.

Chantal said...

Wow, 2%, who knew?!

Yes, double taxation is another big joke. Aren't we proud to be an American?

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