Tax glossary
Tax at source (Quellensteuer)
With tax at source (Quellensteuer), your employer deducts tax directly from your salary and pays it to the tax office — it applies to foreign employees who do not hold a C permit (settlement permit).
Tax at source is a special method of collecting tax: instead of filling in a tax return and receiving a bill later, your employer deducts the tax from your gross salary and pays it straight to the tax office. You receive your net pay — what is left after tax.
Tax at source applies to foreign employees resident in Switzerland who do not hold a C permit (settlement permit), as well as certain people without tax residence in Switzerland — such as cross-border commuters, board members and artists. Anyone who holds a C permit or is married to a Swiss citizen is assessed in the ordinary way.
The tax-at-source rate already includes flat-rate deductions for professional expenses, insurance premiums and personal allowances. Individual deductions, however — Pillar 3a, training, third-party childcare, maintenance payments, medical expenses — are not included.
When a correction pays off
Precisely because the rate only works with flat rates, many people taxed at source pay too much. There are two ways to get money back.
- Subsequent ordinary assessment (NOV, nachträgliche ordentliche Veranlagung): you file a full tax return and claim all your individual deductions. From a gross annual salary of CHF 120,000, it is automatic and mandatory.
- Applying for an NOV: if you earn below this threshold, you can apply voluntarily — the deadline is 31 March of the following year and cannot be extended.
- Recalculation of tax at source: for corrections to the rate applied, for example an incorrect marital status, the wrong number of children or church tax charged in error.
The application is binding one way
Once you have applied for a subsequent ordinary assessment, you will be assessed in the ordinary way every year until your liability for tax at source ends. You cannot withdraw it.
That is no disadvantage as long as your deductions exceed the flat rates built into the tax-at-source rate. But it can become one if your situation changes — for instance, if you stop paying into Pillar 3a. A quick calculation beforehand is therefore worthwhile before you apply.
The deadline is strict
The application for a subsequent ordinary assessment must reach the tax office by 31 March of the year following the tax period. This is a statutory forfeiture deadline — it cannot be extended, and late applications will not be considered. Any tax at source overpaid is then lost for good.
Example: taxed at source with Pillar 3a
An employee with a B permit earns CHF 95,000 gross in Winterthur and pays CHF 7,258 into Pillar 3a every year. The tax-at-source rate does not account for this deduction — so, at first, his contribution has no effect at all.
With a timely application for a subsequent ordinary assessment, the deduction is taken into account. At a marginal rate of around 22 per cent, that means a refund of about CHF 1,600 — for an application that takes a few minutes.
Frequently asked questions: Tax at source (Quellensteuer)
I missed the 31 March deadline. Can I still do anything?
Not for a subsequent ordinary assessment — the deadline is a forfeiture deadline. What remains possible is a recalculation of tax at source if the wrong rate was applied, for example because of an incorrect marital status or number of children.
Do I have to apply for the NOV again every year?
No. After your first application, you will be assessed in the ordinary way every year until your liability for tax at source ends — automatically and irrevocably.
What happens when I receive a C permit?
Your liability for tax at source ends from the following month, and you are then assessed in the ordinary way. The current year is settled on a pro rata basis.
I'm married to a Swiss woman — am I liable for tax at source?
No. Marriage to a person with Swiss citizenship or a C permit ends your liability for tax at source.
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