What is the wealth tax
The wealth tax (Vermögenssteuer) is an annual tax on the total net wealth of individuals domiciled in Switzerland. It is a distinctive feature of the Swiss tax system: unlike most European countries, Switzerland taxes not only income but also accumulated wealth.
The tax is levied exclusively at cantonal and municipal level — there is no federal wealth tax. This means that rates, exemptions and calculation methods vary significantly from one canton to another, creating genuine inter-cantonal tax competition.
The tax applies to net wealth, i.e. the difference between the total value of assets (movable and immovable property) and the taxpayer's documented debts as at 31 December of the tax year.
Switzerland is one of the few OECD countries that still levies a wealth tax on individuals. However, rates are generally moderate (between 0.1‰ and 10‰ depending on the canton and the amount) and exemption thresholds reduce the burden on more modest assets.
How the mechanism works
The wealth tax follows a simple logic but with various cantonal nuances:
- All the taxpayer's assets are calculated as at 31 December: bank accounts, securities, real estate, vehicles, insurance, valuables, company shares
- All documented debts are deducted: mortgages, personal loans, business debts, unpaid taxes due
- The net taxable wealth is obtained, to which an exemption threshold may apply (variable by canton, marital status and children)
- The cantonal and municipal rate is applied, generally progressive: the higher the wealth, the higher the marginal rate
- Spouses are taxed jointly on both their combined wealth, but the progressive rate takes account of the family situation
Calculation formula
Net taxable wealth = Total assets (31.12) – Total debts – Cantonal exemption → × Progressive rate = Wealth tax due
Components of the taxable base
Taxable wealth includes all economically valuable assets owned by the taxpayer and their spouse. Here are the main categories:
Cash and bank accounts
Current accounts, savings accounts, term deposits in Switzerland and abroad. Valued at the actual balance on 31 December.
Securities and investments
Shares, bonds, investment funds, ETFs, structured products. Valued at stock market price on 31 December (FTA rate list/Kursliste).
Real estate
Properties in Switzerland and abroad. Valued at cantonal tax value (Steuerwert), which is normally lower than market value (approximately 60–80%).
Vehicles and movable property
Cars, motorcycles, boats, artworks, jewellery of significant value. Valued at estimated market value with annual depreciation.
Life insurance
Life insurance policies with surrender value (excluding pillar 3a during the savings phase). Valued at surrender value on 31 December.
Company shares
LLC shares, unlisted SA shares. Valued according to the FTA practical method (average of earnings value and net asset value).
Credits and loans granted
Money lent to third parties, valued guarantees, trade receivables. Valued at nominal value or recoverable value.
Cryptocurrencies and digital assets
Bitcoin, Ethereum and other crypto-assets. Valued at the rate published by the FTA on 31 December (official list available since 2019).
Pillar 3a and pillar 2 (pension fund) are NOT included in taxable wealth during the accumulation phase. They are only taxed at the time of withdrawal, as separate income. Pillar 3b (unrestricted private pension) is subject to wealth tax.
How assets are valued
Asset valuation is a crucial aspect as it directly determines the taxable base. Each category follows specific rules:
Listed securities
Valued at the closing price on 31 December, published in the FTA Kursliste (Federal Tax Administration). If the security was not traded on 31.12, the last available quotation is used.
Real estate
Each canton sets its own tax value (Steuerwert/valeur fiscale), generally between 60% and 80% of market value. The value is periodically revalued by the canton. The imputed rental value (for owner-occupied property) only affects income tax, not wealth tax.
Unlisted shares (LLC/SA)
Valued according to FTA Circular No. 28: the weighted average between earnings value (capitalised profits) and net asset value (book equity) is calculated. Earnings value has double weighting. The valuation is updated every 2 years or upon any significant change.
Vehicles
Cars and motorcycles are valued at purchase price with a flat annual depreciation of 40% (declining balance method). After about 5–6 years the residual value becomes negligible. Vintage or luxury vehicles may have different valuations.
Cryptocurrencies
The FTA has published an official list of rates for the main crypto-assets as at 31 December since 2019. For tokens not on the list, the taxpayer must document the market value with reliable sources (CoinMarketCap, CoinGecko).
Cantonal rate comparison
Differences between cantons are significant. Here is a comparison of maximum rates and exemptions for the main centres (2026 data, single person):
| Canton | Maximum rate (‰) | Tax-free amount |
|---|---|---|
| Zurich | 3.0‰ – 3.5‰ | CHF 77,000 (single) / CHF 154,000 (married) |
| Bern | 3.6‰ – 4.5‰ | CHF 97,000 (single) / CHF 194,000 (married) |
| Ticino | 2.5‰ – 3.5‰ | CHF 200,000 (single) / CHF 400,000 (married) |
| Vaud | 5.5‰ – 7.5‰ | CHF 58,000 (single) / CHF 116,000 (married) |
| Geneva | 5.5‰ – 10.0‰ | CHF 89,176 (single) / CHF 178,352 (married) |
| Lucerne | 0.7‰ – 1.7‰ | CHF 50,000 (single) / CHF 100,000 (married) |
| Schwyz | 0.5‰ – 1.5‰ | CHF 200,000 (single) / CHF 400,000 (married) |
| Zug | 0.5‰ – 1.0‰ | CHF 100,000 (single) / CHF 200,000 (married) |
The rates shown include cantonal and municipal tax (for cantonal capitals). The actual tax depends on the municipality of domicile and can vary significantly even within the same canton. Central Swiss cantons (Schwyz, Zug, Nidwalden) offer the lowest rates.
Practical calculation examples
Here are three typical profiles to understand the concrete impact of the wealth tax:
Profile 1 — Single employee, Zurich
| Total gross assets | CHF 350,000 |
| Deductible debts | – CHF 80,000 |
| Net taxable wealth | CHF 270,000 |
| Estimated wealth tax | approx. CHF 250 – 400/year |
Profile 2 — Couple with property, Ticino
| Total gross assets | CHF 1,200,000 |
| Deductible debts | – CHF 600,000 |
| Net taxable wealth | CHF 600,000 |
| Estimated wealth tax | approx. CHF 500 – 900/year |
Profile 3 — Investor, Geneva
| Total gross assets | CHF 3,500,000 |
| Deductible debts | – CHF 400,000 |
| Net taxable wealth | CHF 3,100,000 |
| Estimated wealth tax | approx. CHF 12,000 – 18,000/year |
Amounts are indicative estimates based on 2026 rates of the respective cantonal capitals. The actual tax depends on the municipality of domicile, marital status and asset composition. For a precise calculation, use your canton's tax simulator.
Legal optimisation strategies
There are several lawful strategies to reduce the taxable base of the wealth tax:
Pension fund buy-back (2nd pillar)
Voluntary contributions to the 2nd pillar reduce taxable wealth because the pension fund is not included in the calculation base. At the same time, the buy-back is deductible from taxable income. A double advantage.
Pillar 3a contributions
Pillar 3a is also excluded from taxable wealth during the accumulation phase. Contributing the maximum each year reduces both taxable income and taxable wealth.
Mortgage amortisation
Partial amortisation reduces debts but also net wealth. In some cases it may be more advantageous NOT to amortise to maintain a deductible debt that offsets the property's tax value.
Choice of canton of domicile
Cantonal differences are enormous: wealth of CHF 2,000,000 can generate a tax of CHF 1,000/year in Zug versus CHF 12,000/year in Geneva. Domicile is the most determining factor.
Investment timing
Wealth is valued on 31 December. Investments made at year-end that reduce liquidity (e.g. pension buy-backs, advance payment of invoices) decrease the taxable base for that fiscal year.
Corporate structure (holding)
For significant wealth, holding investments through a holding company can reduce personal taxable wealth, as the tax valuation of unlisted shares is often lower than the market value of the underlying assets.
Practical tips
- Check the tax value of your properties every year: some cantons periodically revalue them and you could challenge an excessive value with a professional appraisal
- Declare all debts as at 31 December — including short-term ones such as taxes due, invoices payable and credit cards with a negative balance
- If you own cryptocurrencies, consult the official FTA list for values as at 31 December and keep wallet screenshots as documentary evidence
- Spouses should plan together: wealth is pooled and taxed jointly, but exemptions are more generous for couples
- Consider pension fund buy-back as a dual-effect tool: it reduces taxable income AND taxable wealth in the same year
- If you hold shares in unlisted LLCs or SAs, make sure the valuation follows FTA Circular No. 28 — many taxpayers overestimate the value and pay too much
- Use AccountEX to have a clear view of your net wealth throughout the year and plan optimisation strategies before 31 December
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