What Happens If I Cannot Pay My Swiss Tax Bill On Time?

Dear Moneyguru,

I only recently became financially independent and will be filing Swiss tax returns for the first time this year. I'm not yet sure how I will afford to pay taxes and would like to know what would happen if I cannot pay my taxes by the due date. Would I face criminal charges?

I would appreciate any information you can give. Thanks.

Hi there,

moneyland.ch is not a tax advisory service. Tax laws in Switzerland vary between cantons, and the way in which late payment of taxes is handled can also vary.

Consider budgeting approximately 10% of your income towards taxes every month (more if you earn a high income or have a lot of wealth) so that you have cash on hand to pay your tax bill.

As a general rule, if you cannot afford to make your tax payment on time, the tax office will charge interest on the amount owed. The onus normally rests on you to approach the tax office with a proposal for an installment payments plan. You can either visit the tax office to discuss the matter in person, or send a letter detailing the reasons why you are unable to make the payment on time and proposing an installment payment plan. Ideally, your proposed plan should be created so as to repay your tax debt within 6 months. In some cantons, you may be asked to disclose your financial situation (through bank account statements, for example) in order to prove that you are unable to pay your taxes and that an installment plan is necessary.

If you are undergoing extreme financial hardship and your income is below your municipality's minimum existence level, you can request a reduction or even a full exemption. Recipients of welfare are typically eligible for tax exemptions or reductions.

Best regards from Moneyguru

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