Tax in Switzerland
First of all, for any advice about Swiss taxation and residency we recommend you contact a local Swiss "fiduciaire".
The income tax is levied at federal, cantonal and communal level. Personal income tax is progressive in nature. The total rate does not usually exceed 40% and in most cases, the maximum tax rate is much lower than this. For example, in the canton of Schwyz, the top rate, inclusive of federal, cantonal/communal tax is approximately 22%. The progressive tax is levied up to a maximum of 11.5% for incomes over CHF682,200 at federal level, and approximately twice that at cantonal level. There is considerable variation between cantons. Municipal rates are usually a small fraction of cantonal rate
The current VAT rate is 8%, last rise on January 1st 2011. Certain goods like food, medicines, books are taxed at the favourable rate of 2.5%.
Social Security Taxes
These taxes are payable by employers, employees and the self-employed. Currently, the total annual old age and disability contribution is 10.1% of total employee remuneration (no ceiling). Half is pad by the employer and half by the employee. Social security represents approcimately 13.1% of an employee's salary, excluding health insurance costs and some cantonal payments.
The Fiscal Deal
This involves negotiation between the individual and the canton where residency is planned. It is a lump sum method to couple tax payment and residency, it is the easier method and the benefit is that you can end up paying considerably lower tax than a Swiss national.
Corporate income tax is levied at federal, cantonal and municipal levels. The federal corporate income tax rate is 8.5% flat. Since income and capital taxes are deductible in determining taxable income, the effective tax that a company pays on its profits before deduction of tax is 7.83%. Cantonal tax rates can be levied at rates of up to 20% and like the federal tax are progressive, using a scale based on the relationship of profits to net worth. The average cantonal tax rate in 2010 was approximately 21%.
UK VAT rate: recently risen to 20% UK Max. Income Tax: 50% UK Corporation Tax: 26% UK National Insurance: up to 26% (employee 12%, employer 13.8%)