Your 2019 Geneva Tax Declaration : 5 Tips

Within the context of the Covid-19 health crisis, the cantonal tax authorities have adopted certain measures. One of these includes an extension of the deadline for filing your 2019 tax return. For the record, the first deadline was 31 March 2020, however this has been postponed to 31 May  2020.

What if the extra time spent at home during this self-isolation period was used to prepare and file the tax return on time? Here are 5 tips to help lighten your tax burden.

1. Childcare costs

This is big news for 2019! It is now possible for working parents to deduct up to CHF 25,000 per child (at cantonal and municipal level) from costs such as crèche and “day care”. Please note, however, that if the amount of these costs is below this threshold, only the costs actually paid are deductible. At federal level, the deductible amount for 2019 remains at CHF 10,100 per child.   Nevertheless discussions are underway to increase this threshold.

2. LPP buybacks and pillar 3A contributions

The buyback of pension contributions as well as contributions to Pillar 3a (banking or insurance) constitutes one of the best measures for taxpayers who receive income from gainful employment. Buyback and contributions are deducted at source from taxable income and can therefore considerably reduce the annual tax burden.

If you do not  currently contribute to Pillar 3a, there is always time to start as you can deduct the contributions for the tax year 2020. For LPP buyback, you can ask your Pension Fund for a certificate showing the possible redemption amount and thus make payments by the end of the year.

3. Renovation and maintenance costs

For taxpayers who own real estate, the costs incurred for the maintenance or renovation of their property may be deductible. These may include costs such as boiler maintenance, chimney sweep, paint repair work, or even replacing the dishwasher. The Geneva administration has published a precise list of deductible costs (https://www.ge.ch/document/301/annexe/0).

It is necessary to clearly distinguish between the costs which make it possible to maintain the value of the property (deductible) and those which increase its value (non-deductible capital gain). The latter will not be deductible and must be declared in your tax declaration. They will increase the value of the property but can be postponed until the event of a sale, in order to bump up the  declared purchase price in the calculation of the taxable capital gain.

4. Training Fees

Expenses for training, retraining or reintegration during the 2019 year are deductible from your income up to  a limit of CHF 11,942 at cantonal and municipal level and CHF 12,000 at federal level. These may include continuing education costs necessary for gainful employment, professional training costs (CAS, DAS, MAS, patent or federal diploma) or even retraining costs (new higher education) in order to start a lucrative professional activity in a new field.

Please note that if training costs are paid by the employer, they cannot therefore be declared and deducted by the employee.

5. Tax Debt

If as of 31 December  2019, you have not paid all of your estimated 2019 tax, the unpaid tax can be declared as a tax debt in order to decrease your taxable wealth. Do not forget to declare any credit card debts, these are overlooked far too often.

If during 2019, you received a tax decision for aprevious year and interest was charged to you (default interest, negative compensatory interest), you can declare it in your 2019 return; this will then be deducted from your taxable income.