Note: Scroll down for information on merging Swiss and Canadian tax realities.
After a protracted silence during which we engaged in a little bit of wrangling with Canadian and Swiss tax authorities in an effort to avoid double-taxation, this blog sputters back to life momentarily to make note of another blog.
Note: The above icon and header belong to the Swiss Consulate. It is copied here only because the Consulate’s centennial celebration is the subject of this blog. Please do not launch a lawsuit against me, kind Swiss people.
Swiss foreign correspondent, journalist and novelist Bernadette Calonego happened across Hobonotes while preparing to launch her blog Bernadette’s Take for the Swiss Consulate in Vancouver, celebrating 100 years of official relations between Switzerland and Western Canada. She contacted me and we engaged in what was supposed to be her interviewing me about the Canadian perspective on Switzerland, but really it was me fact-checking my impressions of Switzerland with her.
I felt a twinge of nostalgia as I tuned in to her Swiss German accent that propelled me back into my not-so-great communicating with Swiss-Germans skills, which is to say that my English gets a little clunky when I try to wash it of cultural nuances that might be lost on non-Canadians. No worries, though, as Bernadette has been in Canada for over a decade, and so her English is superb. She might have wondered whether I am a real English-speaker though.
No matter. She wrote this very kind post about Hobonotes. If you’re thinking of going to Switzerland, take a browse through her blog that touches on some of the cultural surprises that might lie in store for you.
And about those taxes: Canada and Switzerland are signatories to an international tax treaty or something like it, that assures Canadians working in Switzerland, as well as Swiss working in Canada, that they will not be taxed twice by each nation. Doesn’t that sound simple? Of course, it is not. It turns out that Canadian and Swiss notions about what constitutes a federal tax statement differs a bit. Don’t fret. Here’s the short of it.
In Switzerland, be sure to obtain your employer’s notice of withholding taxes. This document will detail the taxes they held back, which were paid to Swiss coffers and which constitute a deduction from your Canadian taxes.
We did this. The problem is that Canada doesn’t recognize tax statements from Swiss employers. They want something from the federal government. This struck us as odd given that they accept T4 slips from Canadian employers, but one does not raise arguments when in discussions with tax agents.
Canadian tax authorities insisted on a federal tax statement from Switzerland’s most federal of governments. The problem is that Switzerland doesn’t really have a federal government. They take the old United States idea of a confederation of states/cantons and they really mean it, and so it turns out that ‘federal’ tax statements actually come from cantonal offices. Don’t fear if you are reading this from Switzerland and have suddenly broke into a cold sweat at the realization you may have tax agents on your heels shortly after your return to Canada.
We have already broken into that cold sweat for you. But the stress of paying twice as many taxes as expected has suddenly fatigued me. I will write more about what to do about this conundrum later.
In the meantime, take a browse through Bernadette’s quirky blog. I think you’ll like it.
APRIL 10, 2013: TAX ADDENDUM FOR FOREIGN WORKERS & OUR EXPERIENCE:
- Revenue Canada will accept cantonal (state or provincial-level) tax statements. Contact the the office in your canton to request your “notice of withholding taxes.”
- To find your cantonal tax office, go to www.ch.ch, and enter your town name or postal code in the search box.
- Send an email via their online contact form with your request and be sure to include the term “notice of withholding taxes,” as more Canadianesque references (tax return, T4, etc.) might confuse the issue.
- Expect a prompt reply. These are the Swiss, after all, a people who pride themselves on efficiency. In my search, I sent out four emails and received responses to all within 24 hours. Of the four, I took up the conversation with the one most fluent in English (for simplicity’s sake), who then provided me with the name of the individual who could provide the documentation. The appropriate electronic document was sent out within a week, and the hard copy followed soon after via post.
- We concurrently enrolled our employer in a search for the correct tax document (leaving nothing to chance). They acquired the statement and forwarded it to us. It arrived shortly after the document we had chased down, so you might find it quicker to navigate your paper-chase on your own.
- Language and culture issues:
- In all government correspondence, use English, German, French and Italian.
- On your first email, put English at the top as this signals to the Swiss that this is the language in which you are most comfortable.
- Do not be taken aback if you receive a response in German/French/Italian only. This is not considered rude in Swiss society – you are dealing with their official government and they expect communication in their official languages. It would be considered rude to insist on your language being used (although they will make every effort to accommodate you – just be polite about it).
- Important tip that no one will tell you about: If you do receive a response that includes any English, my advice is to seek help from this writer, even if he/she is not able to help you directly.
- Ask them for the names, offices, emails and phone numbers of those tax staffers who can assist you.
- Then use this person’s name in your subsequent emails, as this English-speaking staffer can provide behind-the-scenes support to your request, and bridge the culture/language gap.
- How do you use their name? When you write to the offices that they recommend, open your subsequent emails with “Mr. X from the X Cantonal Office (provide Mr. X’s email and phone number in brackets) advised that I contact you regarding my request. If the person receiving your email has some language confusion over your request, he/she will likely contact your Mr. X (or Ms. X, whichever) for clarification, thus making Mr. X your culture and language agent.
- Even after English has been established as your language of choice, it is then polite to place the language used by your correspondent in his/her response at the top of your next email. For example, if you receive a response in German first, then follow suit as that is the native language of the tax personnel.
- Use Google Translate to provide the French, German and Italians translations. It is not perfect, but it is acceptable.
- When all else fails: If you continue to have trouble acquiring the necessary Swiss documents, contact a Swiss attorney to assist you. It will very likely be worth the legal fees to pursue this, rather than suffer double-taxation. Oh, which brings me to another point that can make your life easier. When you are exiting Switzerland, you will be required to have exit documents notarized by an attorney. Use an attorney fluent in English, and make sure you meet him, not just his staff. This attorney can be your point of contact for finding a Swiss tax attorney, should matters come to that. Keep his contact information after you leave the country. This might seem like an obvious thing, but it did not seem so obvious to us until after we ran into our tax snafu.
- Be patient. You are navigating a bureaucracy and while it may seem frustrating at times, it will work out. While it took the Swiss less than a week to produce the documents, it took Revenue Canada two months to accept them (sigh). Revenue Canada, while being very helpful, was still unable to tell us precisely which documents would be required, although you would think they would know this as we were not the first Canadians filing Swiss tax documents in Canada. Just accept this as your tax reality and deal with it.
I’m so glad you’re back on. I missed the entertainment of reading your blogs. By the way, what’s happening with the book? Diana