Moving to the USA from Switzerland: tax, social security, your company, pensions and visas

Leaving Switzerland for the United States touches your cantonal tax return, your AVS record, your pension fund and your company all at once. This guide sets out how Swiss tax liability ends, what the Switzerland-US tax treaty and social security agreement say, and how E-1 and E-2 treaty status works for Swiss citizens.

How your Swiss tax residence ends

Swiss tax follows where you live, not your passport. You are taxable in Switzerland by personal attachment while you are domiciled or staying there for tax purposes, and nationality plays no part. Domicile means living in Switzerland with the intention of settling permanently; a stay starts after 30 days with gainful activity or 90 days without, without notable interruption. While that attachment lasts, liability is unlimited, except for businesses, permanent establishments and real estate abroad.

Your Swiss tax liability ends on the day you leave. The cantons tax the departure year up to that date: Geneva taxes the period from 1 January to the departure date, annualises income to set the rate and taxes wealth at its value on the departure day, and in Vaud a return covers income from 1 January to the day you leave.

Leaving does not cut every tie. You stay taxable on economic attachment, for example as the owner of Swiss real estate, and on pensions from Swiss public-law employment and income from Swiss private occupational pension institutions and pillar 3a. The only extension beyond residence covers people abroad who work for the Confederation or another Swiss public body and are exempt where they live. The Federal Department of Foreign Affairs puts it simply: people who settle and work abroad must in principle pay tax there, and those who move their centre of life abroad remain only partly taxable in Switzerland.

• Announce your departure to your commune if you leave for more than three months, give up your home and do not plan to return soon; the rules vary by canton.
• Geneva: tell the cantonal population office (OCPM) two weeks before the departure date, and present yourself to the cantonal tax administration at least 15 days before leaving with the departure form and the return for the current year up to the departure date.
• Vaud: announce the change of address only to the residents' office of your departure commune, which informs the tax authority.
• Swiss nationals register with the competent Swiss representation abroad within 90 days of announcing their departure.
• Basic LAMal health cover ends when you take up domicile outside Switzerland; insurers may offer people who were compulsorily insured a contractual continuation of cover.
• Men liable for military service who announce their departure or leave for more than twelve months must request military leave, and a definitive departure is reported to the motor vehicle office.

Departure tax on individuals and shareholdings

For private individuals, Swiss law treats capital gains gently. Gains on the disposal of private assets are not taxable for the federal income tax, and the cantonal harmonisation law exempts them for cantonal tax as well.

The picture changes if you are self-employed. Transferring business assets into private assets, or into a business or permanent establishment abroad, is treated as a disposal, and the gain is taxed as self-employment income. The same rule applies to cantonal taxes.

Shareholdings can fall inside this rule. A holding of at least 20% in a company counts as a business asset if you declared it as such on acquisition, so it is worth checking how your stake was recorded before you move.

The Switzerland-US income tax treaty

The Switzerland-US income tax convention was concluded on 2 October 1996 and entered into force on 19 December 1997. A protocol signed in Washington on 23 September 2009 amends it and has been in force since 20 September 2019.

Dividends. The source state may tax dividends at no more than 5% where the beneficial owner is a company holding directly at least 10% of the voting rights, and at 15% in all other cases. Dividends owned by a pension fund, similar institution or individual retirement plan established in the other state and owned by a resident of it are exempt in the source state, subject to competent-authority recognition and provided it does not control the payer. Article 10 has no 0% rate for parent companies.

Pensions. Private pensions and similar remuneration for past employment are taxable only in the state of residence, subject to Article 19. Social security benefits and other public pensions are taxable in the residence state, and the paying state may also tax them at no more than 15% of the gross amount.

Tie-breaker. If both states treat you as resident, the treaty looks first at your permanent home, then your centre of vital interests, then habitual abode, nationality and finally mutual agreement of the competent authorities. A US citizen or green card holder who is not a Swiss resident counts as a US resident under the treaty only with a substantial presence, permanent home or habitual abode in the US.

Saving clause. Like most US treaties, this one lets the US tax persons it considers residents (except those who are Swiss residents under the tie-breaker) and its citizens, former citizens included, as if the convention had not entered into force. The exceptions in Article 1(3)(b), which include Article 19(1) and (2), protect only individuals who are neither US citizens nor holders of immigrant status, and Article 19(4) on social security is not in the general exception list of Article 1(3)(a).

Social security: the US-Swiss agreement

The US-Swiss social security agreement was signed in Bern on 3 December 2012 and entered into force on 1 August 2014, replacing the earlier agreement in force since 1 November 1980. The Federal Social Insurance Office lists the convention and administrative arrangement with the United States as of 1 August 2014.

• Posted workers: if an employer with a place of business in one state sends you to the other for a period not expected to exceed 5 years, you stay only under the first state's compulsory coverage. The competent authorities may agree an exception or an extension of the 5-year period. A spouse and children living with you who are not gainfully employed stay under the same system.
• Certificate of coverage: the employer in Switzerland requests form CH/USA 10 from the compensation fund that collects its Swiss contributions.
• Self-employed: you are covered only by your state of residence.
• Benefits: Swiss and US periods are totalized only for the Swiss disability pension, and only where the Swiss periods amount to at least one year; the amount is based on Swiss periods alone. Each state pays nationals of the other living in a third state on the same terms as its own nationals there.

Keeping your Swiss company with a US subsidiary

Many founders keep their Swiss company and build the American business as a subsidiary below it. Dividends from the US subsidiary to a Swiss company holding directly at least 10% of the voting rights face US withholding capped at 5% under the treaty; there is no 0% rate for parent companies.

In Switzerland the federal profit tax on capital companies is 8.5% of net profit. A company holding at least 10% of another company's capital, or 10% of its profits and reserves, or participations with a market value of at least CHF 1 million, gets a reduction of its profit tax in proportion to net participation income. That is the income less related financing costs and a flat 5% contribution for administration costs.

Capital gains on participations qualify only if the stake sold was at least 10% and held for at least one year. The cantonal harmonisation law imposes the same participation reduction on cantonal and communal profit tax, so the cantons apply the same test.

The choice of US entity matters. Under the treaty, a partnership, estate or trust, for example a US LLC taxed as a partnership, is a resident only to the extent its income is taxed in that state like the income of a resident, at entity level or in the hands of its members or beneficiaries.

Pensions and retirement savings when you move

AVS. The US is a social security agreement country, so Swiss, EU/EFTA and US nationals keep the right to have their AVS pension paid after the move. Pensioners announce their departure to the paying compensation fund, which passes the file to the Swiss Compensation Office in Geneva, and pensions abroad are generally paid in the currency of the payment address. Supplementary benefits (PC) and the helplessness allowance are lost on settling abroad. AVS benefits are not subject to Swiss tax at source; under the treaty the US as residence state taxes them, and Switzerland may tax them at no more than 15% of the gross amount.

Voluntary AVS/AI. Swiss and EU/EFTA nationals living outside the EU/EFTA can join voluntary AVS/AI after five consecutive insured years immediately before leaving. Register with the competent Swiss representation within one year of leaving compulsory insurance; after that, joining is no longer possible. Employed members pay 10.1% of earned income (AVS 8.7%, AI 1.4%) plus a 5% administration charge. Non-employed members pay according to wealth and pension income, CHF 1,010 to 25,250 a year at the 2025 status, with the minimum rising to CHF 1,030 on 1 January 2027.

Second pillar. When you leave Switzerland definitively you can demand cash payment of your vested occupational benefit. The article 25f LFLP restriction on the mandatory part does not apply to a move to the United States. If you are married or in a registered partnership, the payment needs your spouse's or partner's written consent.

Tax on private pensions and lump sums. Under the treaty, private pensions for past employment paid to a US resident are taxable only in the US, and private second-pillar and pillar 3a pensions paid to US residents are not withheld at source. Lump sums work differently: capital benefits paid to people no longer domiciled or staying in Switzerland are always taxed at source, through a federal share plus each canton's own source tax. For US residents that tax can be refunded on a certificate from the US tax authority, provided the request reaches the competent tax authority within three years of the payment.

Public-law pensions. For public-law pension schemes, the AFC overview for US residents shows withholding on pensions and no lump-sum refund for Swiss citizens, but no withholding and a possible refund for US citizens and dual nationals.

Visas: E-1 and E-2 treaty status, reciprocity and the Visa Waiver Program

Switzerland is a treaty country for both the E-1 treaty trader and the E-2 treaty investor visa, with the treaty in force since 8 November 1855. It appears on both the State Department's Foreign Affairs Manual list and its Treaty Countries page.

The reciprocity schedule for Swiss citizens sets these terms. The reciprocity fee is charged in addition to the MRV application fee.

For shorter trips, Switzerland is a Visa Waiver Program country, listed by both the Department of Homeland Security and the State Department, and VWP travel began on 1 July 1989.

To find the visa and structure that fit your plans, book a consultation with Mount Bonnell Advisors or start with the firm's free potential analysis.