Lump-sum taxation in Switzerland 

For foreign nationals who take up residence in Switzerland for the first time or after ten years of absence, and who are not employed in Switzerland, taxation according to expenditure can be recommended. The basis for the calculation of taxes is not the worldwide income and wealth, it is the annual expenditures incurred by the taxpayer.


The calculation basis


The basis for income tax taxation purposes is calculated on the annual expenditures incurred by the taxpayer in Switzerland and abroad. Also the expenses of the spouse and dependent children are taken into account.


Expenditures for the following items are part of the calculation:


  • Food and clothing;
  • Housing (including heating, cleaning, garden maintenance, etc.);
  • Employees
  • Further education, leisure activities, sports, etc.;
  • Trips, vacations, cures, etc.;
  • Expensive domestic animals (horses, etc.);
  • Cars, boats, yachts, aeroplanes, etc; and
  • All other expenses linked with the standard of living.


As it is often difficult to assess the annual expenditures of foreigners, Swiss law provides an individual minimum amount based on the housing costs:


  • For taxpayers residing in their own household, the lump-sum is fixed to at least five times the annual rent paid (if the house/apartment is rented).
  • For other taxpayers, the lump-sum will be fixed on at least twice the annual amount for lodging and food.


For wealth tax purposes the assessed lump-sum basically will be capitalized with 5 % to calculate the taxable hypothetical net wealth.


The following map gives you an overview of the current situation. Click on the cantons to learn more:

amMap example

Canton: Persons benefiting from lump-sum taxation on 31.12.12 / Total tax revenue

Since the cantons of Appenzell Ausser-Rhoden, Basel-Surrounding area and Basel-City decided to abolish the lump-sum taxation in 2012, these cantons still have lump-sum taxation revenues in the 2012 tax year.


Source: KPMG 2014, Data from the Conference of Cantonal Financial Directors in 2013

Status: October 2014



 Download map and status of cantonal implementation as PDF 


Changes from 2016 onwards


The revised law on taxation on expenses will enter into force on 1 January 2016, which will increase the minimum requirements. After this date, the minimum requirements will increase at both federal and cantonal levels: income tax will then be calculated on seven times the annual rent paid (or imputed rental value). In addition, at federal level, a minimum threshold of CHF 400,000 will apply. The cantons are required to define a minimum threshold as well, however they may define it at their own discretion. For information about cantonal legislation, please see the interactive map.


What should be done?


Especially if the living expenses lie below the new limit of CHF 400,000, persons taxed on expenses should reassess their situation.


Frank Lampert

Frank Lampert

Partner, Head of the Market Region in Central Switzerland, Head of International Private Client Services Switzerland, Tax

+41 58 249 49 84

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