Swiss Residence Permit – Swiss Lump Sum Taxation
The Swiss Residence Permit with Lump Sum Taxation offers a distinctive pathway for wealthy non-Swiss individuals to establish legal residence in Switzerland through a unique tax arrangement. This program allows participants to pay taxes based on living expenses rather than global income, providing an attractive alternative to traditional taxation. Eligible individuals can enjoy Swiss residency, Schengen Area travel privileges, and potential long-term settlement options, all while maintaining international professional activities. The Swiss residence permit under this scheme represents a strategic approach for high-net-worth individuals seeking a tax-efficient and lifestyle-enhancing relocation opportunity.
Swiss Residence Permit Benefits
Residency and Family Inclusion
Here are some key benefits and considerations for applicants:
- Dependents can be included in the application, such as:
- Your spouse
- Children under 18 years old
- The right to live and study in Switzerland
- Access to lump-sum taxation
- No obligation to disclose foreign income and wealth
- Visa-free travel within the Schengen Area for up to 90 days within a 180-day period
- Residency permits vary by nationality:
- For nationals of EU member states, Iceland, Liechtenstein, and Norway: A 5-year renewable permit
- For others: A 1-year renewable permit
Travel and Quality of Life
- Free public education up to the age of 16
- Access to free local healthcare (subject to payment of annual social contribution around CHF 26,000)
Ease of Access
- No education requirement
- No language requirement for main applicant. Dependents require A1 oral level or language course enrolment
- Path to permanent residency after 5 or 10 years (depending on nationality) and citizenship after 10 years
Swiss Residence Permit – Swiss Lump Sum Taxation Requirements
- Be over 18 years of age
- For lump sum tax: no Swiss nationality, no tax residency in Switzerland/work in Switzerland in the last 10 years.
- Clean criminal record
- Physical residency requirement: over 6 months per year in selected Canton (main applicant and dependents)
- Obligation to pay social contribution
swiss residency by investment
Lump-Sum Taxation in Switzerland: Tailored Investment and Tax Benefits
Assessment of the lump sum taxation is on a case-by-case basis and
subject to negotiations. The tax rate applied to the taxable base
depends on the selected Canton’s ordinary tax rate (could vary from
22% to 45%).
Different Cantons impose different minimum taxable base. The amount
of the taxable base is based on annual living expenses and is generally
equal to the highest of the following:
- CHF 429,000
- 7 times the annual rent of the applicant’s principal residence in
Switzerland (if renting); - 7 times the annual rental value of the applicant’s principal residence
in Switzerland if the applicant owns his/her place of residence - The family’s annual (worldwide) living expenses
Swiss Residency Process
Processing time 3-6 Months
Due Diligence And Application
Document Collection – Preparation and
submission/negotiation with Tax and Immigration Authorities.
Approval And Investment
Obtain Tax Ruling from Tax Authorities of selected Canton.
Residency
Apply and Obtain Residency Permits for main
applicant and dependents.
Contact us
With over 30 years of immigration experience, each of Harvey Law Group’s lawyers carefully studies each client’s needs, resources and determines the immigration solution that best aligns with our client’s vision and values.
Frequently Asked Questions
What is the Swiss lump sum taxation and residency program?
The Swiss Lump Sum Taxation and Residency Program (“Program”) is available to all except Swiss Citizens. This Program allows non-Swiss citizens to take up residence in Switzerland and opt for pre-determined negotiated lump sum taxation in Switzerland based on annual living expenses (rather than foreign income).
What are the benefits of the Swiss lump sum taxation and residency program?
This Program offers the right to live and study in Switzerland for the main applicant and dependents as well as benefit from lump sum taxation.
Other benefits include visa free travel within the Schengen Area (for 90 days out of 180-day periods), access to public free education up to the age of 16 (after that modest fees would apply), access to free local healthcare (but note that there is an obligation to pay social contribution currently at around CHF 26,000 per person), and possibility to apply for permanent residency after 5 or 10 years (depending on nationality) or Swiss citizenship after 10 years.
There is no obligation to disclose foreign income and wealth. Although paid work is not permitted in Switzerland it is still possible to keep a job (whether employed or self-employed) abroad provided that the presence in Switzerland does not qualify as a permanent establishment.
Which dependents can be included in the Swiss residence permit?
Married spouses, including same-sex spouses, and unmarried children under 18 are eligible as dependents. Bringing dependents requires going through the family reunification procedure. For EU nationals, this process allows the inclusion of children from a previous relationship, provided the other parent consents. Non-EU nationals, however, do not have an automatic right to family reunification; instead, their application is subject to a discretionary assessment by the authorities.
How long is the Swiss residence permit valid for and can the permit be renewed?
For nationals of EU member states and nationals of Iceland, Liechtenstein and Norway: the Swiss residency permit is valid for 5 years (and renewable). For others, the residency permit is valid for 1 year (and renewable).
Is there a language requirement to apply for the Swiss lump sum taxation and residency program?
No language requirement for the main applicant. Language requirements, however, apply to dependents for family reunification (A1 oral level in one of the official languages (French, German, Italian, Romansh) or proof of enrolment onto a language course).
Are there any residency requirements?
The main applicant and their dependents must spend over 6 months per year in the selected Canton.
What are the eligibility requirements?
To qualify for lump-sum taxation, both spouses must meet the conditions for lump-sum taxation: no Swiss nationality, no tax residency in Switzerland/work in Switzerland in the last 10 years.
Clear police records will be required and the authorities reserve the right to deny any applicant and dependent who do not pass the security checks or politically exposed persons at any stage of the process.
What is the process for the Swiss lump sum taxation ?
This Program is two-fold: an Immigration Part and a Fiscal Part. Overall estimated to take around 3 to 6 months. The goal is to complete the entire process from overseas – with lawyers representing the client on the ground. We would ideally negotiate both the decision on lump-sum taxation and the granting of the residence permit before any arrival in Switzerland – although the Cantons are competent for issuing permits and may require the applicant’s presence is required in Switzerland at some point during the process on a case-by-case basis.
Immigration Part: Obtain a residency permit (Permit B) for main applicant, and for dependents based on family reunification process. Family reunification application is submitted at the same time as main applicant (but subject to main applicant’s approval).
The granting of residence permits on the basis of family reunification is an administrative procedure that falls within the remit of the same administration that grants the permit for the main applicant. It is usually initiated at the Swiss embassy when a visa is required. Family reunification application is submitted at the same time as main applicant (but subject to main applicant’s approval).
Fiscal Part: Negotiate and agree the lump sum taxation with the Canton’s fiscal authorities so that they confirm the “Fiscal Interest” as may be required to the Canton’s immigration authorities before they agree to issue the residency permit. Obtain from the tax authorities a tax ruling that is conditional on obtaining a residence permit.
How is the lump sum taxation assessed?
Assessment of the lump sum taxation is on a case-by-case basis and subject to negotiations. The tax rate applied to the taxable base depends on the selected Canton’s ordinary tax rate (could vary from 22% to 45% or so).
Different Cantons impose different minimum taxable base. The amount of the taxable base is based on annual living expenses and is generally equal to the highest of the following:
- CHF 429 000;
- 7 times the annual rent of the applicant’s principal residence in Switzerland (if renting);
- 7 times the annual rental value of the applicant’s principal residence in Switzerland if the applicant own his place of residence; or
- the family’s annual (worldwide) living expenses.
The minimum thresholds for determining the tax base may vary from canton to canton.
Do any government fees apply?
Modest Government Fees would apply to obtain residence permit – amounts differ from one canton to another and may be adjusted from time to time – the current maximum amount (capped by federal decision) is CHF 137.
Can residency permit holders work in Switzerland?
No paid work is permitted in Switzerland, but it is possible to keep a job (employed or self-employed) abroad provided that the presence in Switzerland does not qualify as a permanent establishment.
With the permit, in which countries can the permit holders go without a visa?
Can travel within the Schengen Area (90 days out of 180 days periods) without a visa.
Do the applicants need to visit Switzerland during the Process?
The cantons are competent for issuing permits and may require the applicant’s presence in Switzerland at some point during the process on a case-by-case basis. The goal is however to complete the process before having to enter Switzerland.
Can permit holders apply for permanent residence in Switzerland?
Yes, after 5 or 10 years depending on nationality. Subject to additional requirements, notably integration into local society and skills in one of the official languages.