Reducing taxes by cashing out every couple of years

[daniels27]

The idea would be to use a treaty to be tax resident elsewhere. One could still be resident in Switzerland.

Yes but then you need to be careful. Many countries have rules against this. Guernsey taxes all profits as if they were distributed as dividends (20% for residents). And Switzerland? There is a law that says that if you reduce WHT, all distributable profits with be taxed according to the old rate.

 

[daniels27]

It could work but:

1. in the cash out year you can't stay in CH for more than 29 days otherwise you'll be considered tax resident. (this assuming you don't have any other ties in CH).

2. regardless of point 1 i have the feeling that the chocolate lovers will try to tax you anyway unless you demonstrate that for that year you were tax resident somewhere else.

3. i don't know if CH will be fine with the fact that you are losing CH tax residency every other year. In a way this could demonstrate that you don't have the intention to permanently establish your usual abode in Switzerland but....remeber that it's the country where you are not allowed to hang up laundry outside on Sundays so you'll never know WTF they have in their mind.

It won't work unless you have a parent company elsewhere with a lot of economic substance. Once your cash your, you will fill out the form for no WHT/less WHT, they will check. If they then find that your holding company was actually managed from Switzerland every other year, they will deny all treaty benefits. And a tax certificate from whatever is not going to help as they check themselves.

Also see my above post, they will tax and distributable profit at the former full rate.

Next problem what is with the Swiss company when your are not there? Who is managing it? If you just leave, the tax audit is 100% for the last year you were present. And then you may also face exit tax on the goodwill.

 

[providenceventurer]

Quick response (as Brit citizenship)

Previously could just get dividends in Nov and transfer in Jan tax free.

Now you've got to leave the country to get them tax free, and then return. (6 months floating around).

So Wellington is the DTV enough for me to be in Thailand and do this dividend game that you are playing or do you recommend any other visas,something that has value for money will be nice to know.I am building my business so dont want to go over the top with my spending for the different Thai elite visas .I think with the DTV we are still not residents in Thailand isn't it?

Also from the above discussions of the members @Marzio and @daniels27 it looks like Switzerland is not a great option because they will try to use different ways to tax me this way or that way.