Federal Income tax rates & Brackets
Swiss Federal Income Tax Rates and Brackets (Direct Federal Tax – DBG)
Swiss federal income tax is levied using a progressive tax rate structure defined by the Federal Direct Tax Act (DBG). Unlike cantonal and communal taxes—which vary widely in rates and multipliers—the Direct Federal Tax uses a uniform nationwide tariff.
This guide explains how the progressive federal tax brackets work, how marital status affects taxation, how withholding tax incorporates the federal charge, and how example calculations are performed for individuals and married couples.
1. Overview of Federal Tax Rates
Federal income tax in Switzerland is levied on net taxable income after deductions. The tariff includes:
- a zero tax rate for low-income individuals,
- a gradual increase in marginal tax rates,
- a top marginal rate of around 11.5% for individuals (subject to legislative updates).
Because tax brackets are the same across all cantons, the federal portion is stable, while the cantonal and communal portions vary dramatically depending on place of residence.
2. The Progressive Tariff System
The Direct Federal Tax uses a progressive tax rate schedule. Taxable income is taxed at increasingly higher marginal rates as income rises.
The progressive structure ensures that:
- low-income taxpayers pay little or no federal tax,
- middle-income taxpayers face moderate effective rates,
- high-income taxpayers contribute the largest share of federal tax revenue.
2.1 Marginal vs. effective tax rates
The marginal rate applies only to income within the top bracket reached. The effective tax rate reflects total tax divided by total taxable income, typically much lower.
3. Special Tariff for Married Couples and Single Parents
Swiss federal law recognises that families have different financial capacities. Therefore, married couples taxed jointly and single parents benefit from a reduced federal tariff.
3.1 Married couples
Married couples are subject to joint taxation and a more favorable tax scale that reduces the “marriage penalty” effect.
3.2 Single parents
Single parents who maintain a shared household with their child also benefit from a reduced tariff.
3.3 Comparison to individual tariff
The relief provided at federal level is significant, although cantonal rules may provide additional relief or may differ in structure.
4. Federal Rates Within Swiss Withholding Tax
Non-resident individuals and certain resident employees are taxed at source under the Swiss withholding tax regime (Quellensteuer). The withholding tax tables already incorporate:
- federal income tax,
- cantonal income tax,
- communal multipliers,
- social deductions and personal circumstances (e.g. marital status, children).
While the gross rate appears as a single figure, the federal portion is embedded in the tariff and is calculated according to federal law.
4.1 Annualised calculation
Withholding tax rates use an annualised basis to avoid distortions caused by irregular income (e.g., bonuses). The federal tax portion is proportionally included.
5. Example Calculations
Below are simplified examples demonstrating how progressive federal taxation applies to individuals. Note: figures are illustrative and not tied to a specific tax year.
5.1 Single taxpayer example
- Taxable income: CHF 80,000
- Federal tax: calculated progressively
- Typical federal tax burden: approx. CHF 3,500–4,000
5.2 Married couple example
- Taxable income (joint): CHF 120,000
- Preferential tariff reduces total tax
- Typical federal tax burden: approx. CHF 4,500–5,500
Effective tax rates remain low by international comparison, often between 3–7% for middle-income households.
6. Indexation and Legislative Updates
The federal tax brackets and deduction thresholds are periodically updated, typically to account for inflation or legislative revisions. Adjustments may affect:
- thresholds for each tax bracket,
- basic personal deductions,
- social deductions and child allowances.
When preparing a tax return, taxpayers should rely on the official tariff for the specific tax year.
7. Interaction With Cantonal Tax Rates
The federal tax rate is only one component of the Swiss tax burden. Cantonal and municipal tax rates vary widely and can often exceed the federal portion by a significant margin.
To compare overall taxation across Switzerland, see: Swiss Income Tax by Canton .
8. Next Steps and Related Guides
To understand how federal income tax rates apply in practice, continue with these related guides:
- Swiss Federal Tax Residency
- Taxable Income Under Swiss Federal Law
- Exempt and Non-Taxable Income
- Federal Tax Deductions
- Swiss Withholding Tax (Verrechnungssteuer)
Together, these pages provide a complete, English-language reference for analysing the Swiss Direct Federal Tax.