Expats should make sure they know how inheritance tax in Switzerland could apply to their assets.
Estate tax in Switzerland can also apply if you buy a Swiss property, so estate planning is vital.
Inheritance tax rules and what you pay can vary depending on which Swiss canton you live in.
This guide sponsored by Swiss law firm Wisler Legal covers the following topics:
- Switzerland inheritance law and succession rules
- Switzerland inheritance tax
- Paying inheritance tax in Switzerland
- Reducing your inheritance tax in Switzerland
Wisler Legal is a Swiss law firm providing German and English services. Based in Zurich, they provide expat-friendly advice on a range of inheritance matters, helping you find solutions that are fair for all parties. So, whatever your inheritance needs in Switzerland, Wisler Legal can offer guidance and support.
Switzerland inheritance law and succession rules
Expats living in Switzerland can choose whether Swiss inheritance tax law or the laws of their home country should apply in the event of their death.
If someone dies without leaving a will, or expressing their preference, then the inheritance tax laws in Switzerland will apply by default.
Swiss inheritance law includes forced heirship rules, which means that certain relatives cannot be disinherited even through a last will and testament.
This means at least 50% of the estate goes to the spouse or registered partner, and at least 75% of the remaining half to the children and grandchildren.
Any statutory heirs that receive an inheritance under forced heirship can contest a Swiss will that disinherits them or doesn’t honor the necessary amounts.
However, they can also renounce their statutory rights by signing an inheritance renunciation contract.
Inheritance law on pensions in Switzerland
In some cases, spouses and children can inherit some of their relatives’ pension.
If the deceased paid AHV contributions for at least one year, a surviving spouse, same-sex registered partner or child may be eligible for a survivor’s or orphan’s pension.
A partner can receive CH 948-1,896 per month, while children could get CHF 474-948.
If benefits are already in place, then the survivor’s pension will increase by 20%.
Switzerland inheritance tax
If you’re an heir who’s inherited something under Swiss inheritance law, you don’t have to accept it. In fact, you can choose from three options:
- accept the inheritance;
- reject the inheritance;
- accept, subject to public inventory.
The last option would be used if you’re unsure of the deceased’s financial situation and are concerned the assets you inherit will be outweighed by debts.
A decision must be made within three months of the date of death, otherwise it will be assumed that the inheritance has been accepted.
The Swiss government website has more guidance on how to disclaim an inheritance.
If you do want to accept the inheritance, heirs can obtain a certificate of inheritance from the Swiss authorities to prove their right to inherit.
Financial institutions will need this certificate before money can be withdrawn from the deceased’s accounts.
The certificate costs vary depending on the canton, but can be up to a few thousand Swiss francs. It can take six to 12 weeks to process.
Estate tax in Switzerland
When it comes to inheriting property, several factors will affect how much tax is due:
- the property’s market value
- the degree of relationship to the deceased (which ranges from 0%-40%)
- the canton’s surcharge (100%-300% of the basic rate).
How much inheritance tax will I pay?
Rates of inheritance tax vary between Swiss cantons; some share inheritance tax responsibilities with the municipalities, while some levy taxes on their own. One canton, Schwyz, has no inheritance tax at all.
You can find out more information on Swiss inheritance tax in your canton on the Swiss government website.
The taxable rate also varies depending on the value of the assets and the relationship the heir has to the deceased.
The charges are payable by the person who inherits the estate, but tax doesn’t apply to personal and household goods.
Rates vary from 0-55%, and tend to be lower for close relatives.
Inheritance tax in Bern
Spouses, children and grandchildren aren’t taxed in Bern. Other heirs are split into three groups:
- Lowest rate (Group 1) with a tax multiplier of six: parents, grandparents, siblings and those who cohabited with the deceased for more than 10 years
- Middle rate (Group 2) with a tax multiplier of 11: nephews, nieces, aunts, uncles, in-laws
- Highest rate (Group 3) with a tax multiplier of 16: anyone else.
There is a tax-free allowance of CHF 10,000, and rates range from 1-40%.
|Tax base, CHF||Tax rate|
|Up to 100,000||1%|
Inheritance tax in Geneva
Tax rates in Geneva also vary depending on the relationship between the heirs and the deceased.
- 0-6%: first-degree ascendants/descendants
- 0-7.2%: second-degree ascendants/descendants
- 0-7.8%: third-degree ascendants/descendants
- 0-26%: anyone else.
There is a tax-free allowance of CHF 5,000 for ascendants, descendants and spouses, and CHF 500 for others.
Inheritance tax in Zurich
Spouses and descendants aren’t charged inheritance tax in Zurich, while other heirs are split into six groups:
- grandparents, stepchildren
- uncles, aunts, nieces, nephews
- anyone else
There are also a number of allowances:
- Parents: CHF 200,000
- Unmarried/unregistered partners who lived with the deceased for five years or more: CHF 50,000
- Dependent persons with a disability: CHF 30,000
- Fiancees, siblings, grandparents, stepchildren, godchildren, foster children and those who have been employed as home help for more than 10 years: CHF 15,000
The tax rates are as follows:
|Tax base, CHF||Tax rate|
|Up to 30,000||2%|
If the taxable inheritance exceeds CHF 1,500,000, a flat rate of 6% applies to the whole amount.
A multiplier, which depends on the heirs’ relationship to the deceased, will then be applied.
Paying inheritance tax in Switzerland
Swiss inheritance taxes are generally due within 20 days of receiving the tax assessment.
Expats in Switzerland, as well as Swiss residents abroad, can benefit from the country’s double tax treaties. These have been set up with more than 50 countries, and ensure you won’t get taxed by two different countries.
If your country is not listed, you could be subject to paying Swiss inheritance tax as well as inheritance tax in your home country. You can see a list of on financial advisors in Switzerland to seek expert advice.