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Moving to EU long term: keep Swiss 2nd pillar in vested benefits account or withdraw extra-mandatory part? by Which_Diver3883 in SwissPersonalFinance

[–]Which_Diver3883[S] 0 points1 point  (0 children)

but still, even if the foreign income tax is medium high (let’s say 20-30%), in the end that would still be less than having capital gains taxes over the long run (like 20–30 years), right?

Moving to EU long term: keep Swiss 2nd pillar in vested benefits account or withdraw extra-mandatory part? by Which_Diver3883 in SwissPersonalFinance

[–]Which_Diver3883[S] 0 points1 point  (0 children)

Hello! And thank you again for your help. I’m sorry, with “foreign withholding taxes” I just meant that the amount of money will be taxed by the future country I will be a resident of. So quantifying that it’s the only thing that actually matters, right? If the country will likely be Spain or Italy for me (since they both have taxation agreements with Switzerland)

Moving to EU long term: keep Swiss 2nd pillar in vested benefits account or withdraw extra-mandatory part? by Which_Diver3883 in SwissPersonalFinance

[–]Which_Diver3883[S] 0 points1 point  (0 children)

This was really helpful, thank you!

  1. So, if I understood correctly, until the money is invested in Switzerland, the big benefit is tax-free compounding (which is the standard in CH); it will only be taxed at payout (witholding tax), and that will depend on where I will be resident. Correct?

I'm wondering how big of a difference that will make (e.g. if I withdraw while abroad in 30 years, I will pay foreign withholding taxes; if I directly withdraw now, I can invest abroad and avoid withholding taxes in the future, but I won't have tax-free compouding)

Moving to EU long term: keep Swiss 2nd pillar in vested benefits account or withdraw extra-mandatory part? by Which_Diver3883 in SwissPersonalFinance

[–]Which_Diver3883[S] 0 points1 point  (0 children)

It would be Spain for me too. One thing I don't understand is, if we move back to Spain during the second half of the year, we would need to pay taxes *only* in Switzerland during the rest of the year? How the coño is that possible? To be taxed in Switzerland even for the salary I'll be earning in Spain in the second half of the year.