1. Overview: Why Tax Residency Matters

Tax residency under the Federal Direct Tax Act (DBG) determines:

• whether an individual is taxed on worldwide income or only Swiss-source income,
• which deductions and allowances apply,
• whether taxation is performed via ordinary assessment or withholding tax at source,
• how Switzerland applies double tax treaties.

The federal definition of residency is aligned with cantonal rules, ensuring a harmonised system across Switzerland.

2. Unlimited Tax Liability (Residents)

Individuals who qualify as **Swiss tax residents** are subject to unlimited federal income tax liability. This means:

• Taxation on worldwide income, unless specific exemptions apply.
• Right to claim standard federal deductions and allowances.
• Assessment through the annual Swiss tax return.

2.1 When a person is considered a resident

Under the DBG, a person becomes a resident if they:

• establish their domicile in Switzerland, or
• stay in Switzerland with the intention to settle on a long-term basis.

The intention to settle can be inferred from circumstances such as:

• renting or purchasing accommodation,
• moving family members to Switzerland,
• holding a Swiss residence permit (e.g. B-permit),
• economic ties or long-term employment in Switzerland.

3. Limited Tax Liability (Non-Residents)

Non-residents are liable for Swiss federal income tax only on specified Swiss-source income, including:

• Swiss employment income for work physically performed in Switzerland,
• board of directors fees from Swiss companies,
• income from Swiss real estate,
• certain pension and social security payments,
• compensation for artists, athletes, or lecturers.

Non-residents often become subject to withholding tax at source (Quellensteuer), which covers both federal and cantonal income taxes.

4. How Swiss Tax Residency Is Determined

Unlike some jurisdictions, Switzerland does not rely on a single-day count test only. Residency is assessed via a combination of legal and factual criteria:

4.1 Domicile

A person is domiciled in Switzerland if they establish a permanent home and intend to remain there. Even without formal registration, facts can lead to a domicile.

4.2 Physical presence

Presence for 30 days while working or 90 days without working creates residency unless the stay is demonstrably temporary.

4.3 Centre of vital interests

Authorities look at personal and economic ties, including:

• location of main residence,
• family location,
• employment location,
• social and economic connections.

5. The 183-Day Rule – What It Does and Does Not Mean

The commonly cited 183-day rule is not the primary test for Swiss tax residency. Instead, it usually appears in double tax treaties to allocate taxing rights for employment income.

Key points:

• Switzerland can deem a person resident even if they stay fewer than 183 days, provided other residency criteria are met.
• Conversely, staying more than 183 days does not automatically create residency if the stay is temporary.
• For inbound workers, treaty override may apply.

6. Special Residency Cases

6.1 Weekly residents (Wochenaufenthalter)

Individuals who live in Switzerland during the workweek but maintain a primary home abroad may still be considered residents if their centre of life shifts to Switzerland.

6.2 Students and trainees

Students often become residents due to long-term stay, even if no income is earned.

6.3 Diplomats and consular officials

Special tax rules apply; many are exempt from Swiss taxation under international agreements.

6.4 Cross-border commuters

Workers commuting from neighbouring countries may be taxed according to bilateral treaties, especially for France, Germany, Italy, and Austria.

7. Cross-Border and Mobile Workers

Global mobility creates complex residency situations. Common scenarios include:

• employees assigned to Switzerland for less than a year,
• dual-resident individuals,
• individuals working remotely from Switzerland for a foreign employer.

Switzerland applies federal residency rules first, then adjusts the tax outcome based on double tax treaty tie-breaker rules.

8. Impact of Double Tax Treaties

When a person qualifies as a resident of two countries, treaties determine:

• which country has primary taxing rights,
• how employment income is allocated,
• whether foreign taxes are creditable or exempt in Switzerland.

Tie-breaker criteria generally follow OECD standards:

• permanent home,
• centre of vital interests,
• habitual abode,
• nationality.

9. Related Swiss Federal Income Tax Topics

For further details, explore the related guides:

• Taxable Income at Federal Level
• Exempt and Non-Taxable Income
• Federal Tax Deductions
• Federal Tax Rates and Brackets
• Swiss Withholding Tax

For cantonal tax rules, see the complete overview: Swiss Income Tax by Canton .