Source tax 2021: These changes you need to know
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One of the main objectives of the revision of the source tax ordinance was to eliminate unequal treatment between persons subject to source tax and persons taxed ordinarily. In addition, the cantons were obliged to harmonize the calculation of withholding taxes throughout Switzerland.
Together with the cantons, the Federal tax authority (FTA) has drafted Circular Letter No. 45 (KS 45) on the source taxation of employees’ income from employment, which was published on the FTA website on 12 June 2019. It lays down the rules for the calculation of withholding taxes in a binding way for all cantons.
The new regulation has three main objectives:
Employers with employees subject to source tax must implement the new legal basis by the deadline stipulated. For this reason, you should be aware of the need for adjustment and changes. This is the basis for you to calculate your employees’ source taxes correctly in the future.
There are of course many changes and adjustments to the ordinance. The ones that you absolutely must know are the following:
No additional deductions, such as pillar 3a payments, can be claimed as part of the recalculation of source taxes. Provided that the conditions for this are met, these must be claimed under an SOA. Persons subject to source tax who are resident in Switzerland may submit a one-time application for a voluntary SOA, bearing in mind that this application cannot be withdrawn and therefore remains valid until the end of the source tax liability.
In order to take these adjustments into account, various adjustments in your payroll accounting are absolutely necessary. For example, master data or wage types have to be adjusted with regard to tariffs, tax rate determination, etc.
The already mentioned KS No. 45 on the source tax on earned income of employees contains all information on the revision of the regulation.
So that you do not have to gather all the documents on this basis yourself, we provide the following forms and overviews for you to download.
Do you need help in implementing the new source tax regulations? Or would you like to clarify the necessary adjustments with our experts or have them check the adaptations? Then please contact Martin Grüter, he will be happy to help you competently and with pleasure.
With our customer magazine Akzente or our newsletter, both of which you can subscribe to at www.caminada.com, you will receive further news and field reports on the changes in source tax and other current topics.
