Switzerland vs Singapore: Best Tax Residency in 2023

Written by a Geneva-based private banker who has walked more clients through airport lounges than the average pilot.

Why These Two Heavyweights?

When clients ask, “Where can I legitimately pay less tax without downsizing my lifestyle or my yacht?”, two jurisdictions still dominate my spreadsheet: Switzerland and Singapore. Both rank in the IMF’s top-ten GDP per capita, both run world-class financial centres, and both allow you to tuck into truffle pasta without looking over your shoulder for a tax inspector. Yet their fiscal philosophies could not be more different:

• Switzerland: A centuries-old confederation that sells certainty—often in return for a fixed “lump-sum” tax ticket.
• Singapore: A young city-state that rewards where you earn rather than who you are, using a strict territorial tax model.

Today we will dissect both systems the way a sommelier dissects a Pinot Noir—nose, palate, finish—so you can decide which bouquet suits your balance sheet.

1. Lump-Sum vs Territorial Tax: Two Philosophies, One Goal

Switzerland’s Lump-Sum Tax Regime

Under the “forfait fiscal” (the term your French banker friend will use to impress you), Switzerland taxes eligible foreigners not on worldwide income but on your annual living expenses in Switzerland, multiplied by seven. Think of it as a Netflix subscription for the Swiss state: a flat fee, unlimited consumption.

Key bullet points:

• Eligibility: Non-Swiss citizens who do not work in Switzerland (board seats and passive investments are fine).
• Negotiated at the cantonal level—Zurich won’t play ball; Valais, Vaud, and Ticino will pour you a prosecco while they calculate.
• Minimum taxable base: CHF 400,000 nationwide, but popular cantons often set it higher (CHF 650k–1 m is realistic).
• Federal, cantonal and communal taxes rolled in. You still pay wealth tax, but on the same assessed expenditure basis, which matters if you’re balance-sheet heavy.

Result: Once agreed, you know exactly what the tax bite is, whether your portfolio yields CHF 2 million or CHF 20 million. One client of mine tripled his dividend flow after year two; the tax bill didn’t move a franc. He still sends me Christmas chocolates.

Singapore’s Territorial Tax Model

Singapore doesn’t care where you live, it cares where you earn. The Inland Revenue Authority of Singapore (IRAS) subjects you to tax only on:

1. income sourced in Singapore; and
2. foreign-sourced income remitted into Singapore (with key exemptions).

Highlights:

• Personal income tax rates: progressive to 22 % (24 % from YA 2024) but only on Singapore-sourced income.
• Dividends from foreign companies, capital gains and most foreign income are tax-exempt so long as the funds stay parked offshore—or are remitted under the “foreign tax exemption” rules.
• No capital gains tax, no estate duty, no wealth tax.

One American tech founder I onboarded shifted his IP holding company to the Cayman Islands, left the royalties offshore, and lives in a rented black-and-white bungalow near Dempsey Hill. His effective tax rate last year? 2.8 %. He buys me hawker-stall chicken rice instead of chocolates.

“Which One Saves More Tax?”

If your annual global income exceeds roughly CHF 3.5 million, Switzerland’s lump-sum can—surprisingly—beat Singapore. Below that threshold, Singapore’s territorial model usually wins. The reason is simple arithmetic: a CHF 600k forfait equals 600k ÷ 3.5 m ≈ 17 % effective rate. In Singapore, you can often get below 10 % by keeping foreign income offshore.

So the fashionable phrase “Singapore is lower tax” is true—until it isn’t.

2. Cost of Living vs Tax Saved

Switzerland: High-Altitude, High-Price

Let’s address the Matterhorn in the room. Zurich, Geneva, and Zug routinely land in the world’s five most expensive cities. A family of four in Geneva who wants a five-bedroom villa near the International School will encounter:

• Rent: CHF 20k–25k per month.
• Health insurance: CHF 30k per annum for decent private coverage.
• Domestic staff: A live-in nanny hits CHF 85k after social charges.
• Ski weekends: Try buying four ski passes and raclette for less than CHF 1,000.

Annual burn rate for an UHNW family: CHF 1.2–1.5 million, before you wire the forfait to the tax office.

Singapore: Humid, Efficient—and Not Cheap Either

Singapore also has a “nosebleed” index when it comes to rents:

• Prime condo (Orchard/Tanglin): SGD 18k–22k per month.
• International school fees: SGD 40k–50k per child per year.
• Car ownership: A Toyota can cost USD 200k thanks to the infamous Certificate of Entitlement (COE).
• Private healthcare: Significantly cheaper than Switzerland but pricier than Bangkok.

Yet daily life—Grab rides, hawker meals, utilities—remains relatively modest. An efficiently run household can keep annual living costs under USD 600k, half the Swiss figure.

Tax Saving Offset

Let’s run two stylised scenarios:

1. Entrepreneur earning USD 4 m a year in dividends/capital gains.
   • Switzerland forfait: CHF 650k tax ≈ USD 700k. Living cost USD 1.4 m. Total outlay USD 2.1 m.
   • Singapore: effectively 0 % tax (income kept offshore). Living cost USD 600k. Total outlay USD 600k.

2. Hedge-fund principal earning USD 20 m.
   • Switzerland forfait still ≈ USD 700k. Living cost USD 1.4 m. Total USD 2.1 m.
   • Singapore territorial: Suppose USD 3 m is Singapore-sourced (management fee) taxed at ~20 % = USD 600k. Living cost USD 600k. Total USD 1.2 m.

Upshot: Singapore wins at lower income levels; Switzerland narrows the gap at higher levels but rarely overtakes once lifestyle costs are included. Unless—big caveat—you already own property in Switzerland or you are a skiing fanatic who would otherwise drop a fortune on chalet rentals anyway.

3. Lifestyle & Business Environment

Banking Relationships

As a private banker I know one truth: proximity matters. Swiss banks are still the global benchmark for cross-border wealth management. Yes, Singapore’s private banking sector has grown seven-fold since 2008, but if you want multi-currency Lombard lending at negative interest or discreet access to ultra-long-dated structured notes, Zurich trumps Boat Quay.

Yet there is a compliance kicker: Swiss banks have grown wary of US-domiciled clients post-FATCA. In Singapore, onboarding US persons is smoother. (Not simple—just less grey hair for your banker.)

Business Culture

Switzerland: Consensus-driven, rules-based. Setting up a holding AG in Zug takes 4–6 weeks, and you’ll file annual accounts that would make a Big Four auditor weep with joy.

Singapore: Move fast, but document well. You can incorporate a Pte Ltd in 48 hours, hire foreign talent under Employment Passes in weeks, and apply for tax incentives like the Global Trader Programme or Section 13O fund exemption.

If you run a trading desk or a family office with high transaction volume, Singapore’s velocity and timezone (GMT +8) help. If you own a legacy manufacturing group that sells to Germany and Italy, Switzerland’s EU adjacency and bilateral treaties are decisive.

Lifestyle Fit

Switzerland offers:

• Four languages within four train stops.
• Tap water that outranks imported brands in blind tests.
• Ski to lunch, lunch to lake, lake to opera.

Singapore offers:

• 24/7 safety; your children can take a Grab at midnight.
• Food that requires its own Instagram channel.
• A passport stamp to almost everywhere in Asia in under six hours.

One of my clients, a British biotech founder, spent six months in each and described it perfectly: “Switzerland is a postcard; Singapore is a motherboard.” Pick your aesthetic.

4. Exit Strategies: Because Forever Is a Long Time

Exiting Switzerland

1. Fiscal Exit Tax
   Switzerland does not impose a formal exit tax on individuals, unlike France or Spain. But you must settle any accrued wealth tax up to your date of departure.

2. Hanging Sword: Forfait Review
   Authorities can reassess your forfait if you cease to qualify (for example, by taking an executive role in Zurich). In practice you get advance warnings.

3. Immigration
   Non-EU citizens on a residence permit tied to the lump-sum arrangement can struggle to renew if they no longer meet economic thresholds. Keep the relationship warm.

Exiting Singapore

1. No Exit Tax
   Singapore has toyed with the idea but currently no departure tax exists. Your final year tax return remains mundane.

2. Permanent Residency (PR) “Re-Entry Permit”
   If you secured PR, remember the REP might expire after five years. You need to show economic ties (employment, business, property) to renew.

3. Central Provident Fund (CPF) Withdrawal
   If you held PR and thus contributed to CPF, you can withdraw your funds upon permanent departure—but you’ll lose that 4 % guaranteed return.

Portability of Structures

Family offices frequently ask about portability:

• Swiss foundations can migrate, but it’s a legal headache and the supervisors in Bern will frown.
• Singapore Variable Capital Companies (VCCs) are designed to be redomiciled, but only inward at the moment. You can collapse and re-form abroad with negligible tax.

Exit friction is therefore slightly higher in Switzerland—another point on Singapore’s scoreboard.

5. Case Studies (Yes, Real People)

The Art Dealer from São Paulo

Income: USD 12 m, largely capital gains on art sales in New York, London.
Needs: Visa for Schengen, mild winters for health.
Decision: Switzerland (Canton Ticino) with a CHF 750k forfait.

Why: He attends Art Basel, trusts Swiss freeports, and values 90-day Schengen mobility. The forfait saves him ≈ USD 2 m compared with Brazilian taxation even after cost of living.

The Crypto Quant from Seoul

Income: USD 4 m trading gains, 100 % online.
Needs: Fast fibre, easy Asia travel, zero inheritance tax (he’s 29 but forward-thinking).
Decision: Singapore on an EntrePass, no remittance of trading gains.

Outcome: Effective tax <1 %, annual cost of living USD 400k. He quotes: “I spend more on GPUs than taxes.”

The Family Office with Two Generation Gap

Assets: USD 400 m spread across PE and public equities.
Needs: Dollar cost averaging, bilingual schooling, yacht within driving range.
Trialled: Zurich and Singapore via leased apartments.

Result: They run a dual-hub model: investment committee meets in Zurich each June then migrates to Singapore November–March. Tax burden stays within the Swiss forfait; Singapore days kept below 183 to avoid resident status. We handle the flight bookings.

6. How Do They Compare to Other Regimes?

Switzerland and Singapore are not operating in a vacuum. If your tax lawyer suggested Italy’s flat tax or Portugal’s NHR, you’re not alone. We have broken down some of these regimes already in our Switzerland lump-sum vs Italy flat tax deep-dive and in the perennially popular “Portugal vs Malta: NHR vs Global Resident.”

The pattern is clear:

• Italy and Portugal require you to be there 183+ days, which constrains mobility.
• Malta imposes €5,000 minimum tax but is less household-budget painful than Geneva.
• None offer quite the blend of political stability, banking depth and airport connectivity that Switzerland and Singapore deliver.

7. Practical Checklist Before You Leap

1. Run a Three-Year Cash-Flow Model
   Factor lifestyle inflation; your kids will want Swiss ski lessons or Singapore coding camps.

2. Bank Account Pre-Approval
   Swiss banks may ask for tax residency proof; Singapore banks want utility bills. Sort both while you still have one foot in your current country.

3. Immigration Timeline
   • Switzerland lump-sum visa: 3–9 months, dependent on canton.
   • Singapore Employment Pass: often < 8 weeks; Global Investor Programme ≈ 6 months.

4. Health Insurance
   Mandatory in Switzerland; optional but wise in Singapore.

5. Tax Residence Home-Country Exit
   Sell the primary residence? Close local companies? Manage trust distributions?
   Mistiming here can turn a dream move into a CRA/IRS/ HMRC nightmare.

6. Currency Exposure
   CHF vs SGD: one is a safe-haven hedge, the other a quasi USD proxy. Align your portfolio accordingly.

Pull-Quote
“Choosing between Switzerland and Singapore isn’t about paying the least tax; it’s about buying the right kind of certainty for your lifestyle and portfolio.”
– Notes from my 2023 Investment Committee memo

8. Final Verdict: Which Jurisdiction Wins 2023?

If we must crown a winner, the private banker in me cherishes nuance:

• Singapore wins for entrepreneurs with portable income streams, tech talent needs, or Asia-Pacific ambitions. Your effective tax rate can flirt with zero without sacrificing time in the office sauna.

• Switzerland remains unbeatable for wealth preservation, EU adjacency, and families who want alpine air more than night markets. For incomes north of USD 15 m, the lump-sum becomes a predictable, even discounted, line item.

The smartest clients? They prototype. Spend a winter in Verbier and a summer on Sentosa. Measure glucose spikes—both literal and fiscal. Then commit.

Ready to Model Your Own Numbers?

Every balance sheet is unique, and the optimal jurisdiction may be neither of the above. Use BorderPilot’s data-driven engine to simulate your after-tax, after-lifestyle cash flow in minutes. Create your free relocation plan today and see which flag—Swiss cross or Merlion—belongs on your next set of luggage tags.