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Are you wondering if you might be overpaying taxes with withholding tax?
In fact, you could be leaving a lot of money on the table, and switching to retroactive ordinary assessment could result in saving several thousand francs in taxes — and that’s every year!
However, the switch needs to be carefully considered, as it carries risks. In some cases, the retroactive ordinary assessment (tax return) may even lead to you paying more taxes.
Your personal situation is the key factor, and our tax experts will thoroughly review and calculate it to help you avoid any unpleasant surprises.
If our calculations show that the switch is beneficial, you will receive a CHF 50 voucher for your next tax return with ajooda.
Are you subject to withholding tax and wondering if switching to the ordinary tax return could be financially beneficial for you?
In most cases, this can lead to significant tax savings.
Since 2021, individuals subject to withholding tax have the option to voluntarily switch to retroactive ordinary assessment (tax return).
However, this step must be carefully considered, as in 10-20% of cases, it results in higher taxes, potentially for life.
Our experienced tax advisors can calculate the consequences of a switch in advance, ensuring that you are 100% certain whether the switch will save you taxes.
We analyze your individual income situation and take into account all relevant deductions that you may be entitled to with an ordinary assessment.
Withholding tax is deducted directly from your salary and is a flat-rate tax for residents without a C residence permit or Swiss passport. It simplifies the tax process and allows for automatic tax settlement. With withholding tax, there is no annual tax return, which many see as an advantage. The tax burden is calculated based on monthly income.
With retroactive ordinary assessment, the entire income and assets of a taxpayer are accounted for in an annual tax return. With a C residence permit or Swiss passport, the tax return is mandatory. Foreign employees are also automatically assessed retroactively, for example, if their annual gross income exceeds CHF 120,000 or if they have additional income such as dividends.
There is no one-size-fits-all answer, as this depends heavily on your personal financial situation. For example, if you can claim significant deductions (pillar 3a, commuting costs, medical expenses, or education costs), you are better off with a tax return, as many of these deductions are not possible with withholding tax.
Once you switch to a tax return, this step cannot be reversed, and you will have to complete a tax return every year.
If this saves you several hundred or thousand francs per year in taxes, it’s a good thing. However, this is not the case for everyone.
To avoid unpleasant surprises, it’s worth calculating this carefully before making the switch.
If the switch is beneficial, you will receive a CHF 50 voucher for your next tax return with ajooda. Of course, you are free to complete your tax return elsewhere or on your own.
Anyone who is subject to withholding tax in Switzerland and exceeds certain income limits can have it checked whether a change to ordinary assessment makes sense.
This also applies to people who have assets or significant deductions.
The switch can be particularly worthwhile if you have high professional expenses, alimony payments or assets that are not sufficiently taken into account in the context of withholding tax (switching to the tax return is mandatory anyway from a certain level of assets).
First, we use your personal financial data to check whether the change is worthwhile for you.
Then an application for a retrospective ordinary assessment (NOV) must be submitted to your canton of residence. This application must be submitted by 31.03.XX at the latest. You will then receive the document from the tax office with the submission code after a few weeks/months.
Once changed, this method remains in place for the respective tax year as well as for all subsequent years. It is therefore advisable to carry out a detailed analysis in advance in order to make the best decision.