A guide to Switzerland

Careers

Switzerland’s economy has remained stable in recent years with a strong currency, powerful labour market and booming export industry. It’s host to numerous European headquarters and multinational companies, so is a great place to do business – old or new – and expats can earn high wages.

Business is conducted efficiently and transparently; career progress is based on merit rather than connections, with equal opportunities for foreigners and women.

The Swiss value being smart, formal, and punctual. The business structures are hierarchical – managers are expected to lead by example, but decision-making is egalitarian and you’re free to voice your opinions. Respect is earned by hitting deadlines and arriving well prepared. The Swiss like to keep work and their home life separate, so your colleagues might be reluctant to discuss their personal lives.

A firm handshake is the most common business greeting and address senior colleagues by their formal title unless you’re told otherwise. Gifts aren’t expected unless you’re invited to a colleague’s home and then flowers or chocolates are fine.

English is commonly used in business, while German, French and Italian are spoken in their respective regions. Business hours are usually from 8am to 5pm, Monday to Friday.

Education

School is compulsory for children aged between 5 and 15, and the school year runs from September to June. The state-funded schools are free, but classes are taught in the main language of the region. They’re a good option if you plan to settle in Switzerland for the long term or if your children are young enough to become bilingual without too many problems.

Swiss private schools have an excellent reputation with the fees to match – your children will have a more personalised learning experience amongst exceptional facilities. The larger cities with big expat populations also have a selection of international schools, which are great if you only plan to be in the country for a short time and don’t want your children to get behind on the national curriculum of your home country. Competition for places is fierce despite the high fees and waiting lists can be long.

Moving money

Putting the right banking arrangements in place is vital for expats around the world. You want to be able to access and transfer money easily, and with a bank you can trust to comply with international regulations. Most people have two banks – one in their home country and one local to where they’re living. But, if your bank has a global network, you may be able to set up an account ahead of your arrival, which gives you time to assess the financial market.

It’s important to understand how foreign exchange works and how fluctuating exchange rates can affect you. When you’re juggling finances in multiple currencies, remember that the currency markets can move quickly and make a big difference to the value of your money.

To help you reduce the risk of fluctuating currency, you could choose a foreign exchange that lets you fix an exchange rate for a fixed period. Then you’ll know exactly how much you need to convert, whatever happens in the market.

Budgeting

When you’re looking to move to a new country, you need to consider how a change in the cost of living could affect your finances. If you’re moving with your job, sometimes your employer may help with expenses, such as accommodation or school fees. Remember to account for setup costs, such as buying furniture and sorting insurance, when you’re thinking about your budget.

Costs

Some of our offshore accounts have a monthly fee, such as the International Current Account, whereas others, like the Premier International Account, don’t. Both offer fee free International Payments (correspondent and recipient bank charges may apply) and 24/7 worldwide access. Plus, the Premier also includes worldwide travel insurance for you and your family, which is underwritten by AWP P&C SA and administered by Allianz Assistance, which is a trading name of AWP Assistance UK Ltd. Eligibility criteria, terms and conditions apply.

Financial planning

While it’s going to be a busy time, it’s also worth setting some time aside to review your financial plans, such as whether you want to open any offshore accounts. They offer the convenience of keeping your money in one place so you can stay with the same bank no matter where life takes you.

Your expat status could give you new opportunities that weren’t available to you at home. However, tax rules differ from country to country, so if you’re unsure about your personal tax obligations, you should seek professional advice.

Lloyds Bank International Private Banking is by your side every step of the journey as you start your new life abroad. We offer international knowledge, experience and dedicated expert support to help meet all your financial needs. From savings to international payments and transfers, we can help you navigate the complex world of wealth management away from home.

Security

Offshore accounts are not protected by the Financial Services Compensation Scheme (FSCS), which protects savings up to £85,000 with authorised UK banks and building societies.

However, our accounts are covered by other schemes. The Jersey Bank Depositor Compensation Scheme, the Isle of Man Depositors’ Compensation Scheme and the Guernsey Banking Deposit Compensation Scheme offer protection for eligible deposits of up to £50,000.

Tax

The complex tax structure has been shaped by the country’s three levels of government – federal, cantonal, and municipal – payable by all residents on worldwide income.

Swiss federal tax law is uniform throughout the country, but each of the 26 cantons has a separate law for cantonal taxes. Municipal taxes are levied as a multiple of cantonal taxes. As tax laws and tax rates vary widely among cantons and among municipalities, your choice of residence is an important decision.

The maximum overall rate of federal income tax is 11.5%; cantonal and municipal taxes are levied at progressive rates, with a maximum combined cantonal and municipal rate of approximately 36%. In addition, cantonal and municipal net wealth taxes are levied, although there are rules for allocating tax liability among the cantons to avoid double taxation.

Individuals establishing tax residence in Switzerland are assessed for federal income tax purposes on a current-year basis. Special rules apply for the first year, but the assessment may be altered if certain extraordinary events substantially change an individual’s financial situation. In general, taxable income for federal tax purposes consists of all types of income earned by a resident individual, including remuneration from an employer; self-employment or business income; pension payments; and compensation for loss of work or ill health; and income from private investments and real estate.

Income from a business, an establishment or real estate located abroad is exempt from taxation, although it must still be recorded on a tax return for the determination of the tax rate.

At the cantonal level, tax is also assessed on a yearly basis, calculated in basically the same way as taxable income for federal taxes. Non-residents are subject to tax on income from Swiss real estate, interest in a Swiss partnership or sole proprietorship, trade, or business attributable to a Swiss permanent establishment or fixed place of business, professional practice or services performed in Switzerland, and payments from Swiss pension funds.

Individuals are considered resident in Switzerland if they stay or intend to stay for longer than one month or work in Switzerland for a period exceeding 30 days.

The Federal Tax Administration (FTA) is responsible for VAT, withholding tax and direct federal tax, and the tax year runs from 1 January to 31 December with tax returns to be filed by 31 March of the following year. See www.estv.admin.ch for further information.