1. Background
Nik and Tom have been in a relationship for several years and are planning to buy a house together. Tom works in the financial sector, while Nik is the creative one. While Tom’s salary is CHF 200k, Nik’s—who works as a freelance illustrator—ranges from CHF 60k to 80k. Consequently, the savings they can contribute as down payment toward the property are unevenly distributed between them.
As a couple living together as equals, it’s important to them that both have an equal stake in the house.
In this context, several questions arise:
Questions
- Tom and Nik are planning to purchase the property either as joint owners or as co-owners, each with a 50% share. How do these two forms of ownership differ under civil law, and which form is more suitable for a cohabiting couple? What are the tax implications of choosing a particular form of ownership under civil law?
- Tom and Nik have decided to purchase the property in a suburb of Bern as co-owners, each with a 50% share. Nik is contributing CHF 100k toward the down payment of CHF 400k, while Tom is contributing CHF 300k. Both are jointly and severally liable to the bank for the CHF 1.3 million mortgage. From a civil law perspective, what options do Tom and Nik have for arranging the financing between themselves, and what are the tax implications?
- Nik and Tom have set up a joint account for household and home expenses. Based on their financial means, Nik contributes 1/3 and Tom contributes 2/3 of the funds needed for the home and household to this account. These funds are used to make mortgage payments, cover the home’s ongoing maintenance and utility costs, and pay for the couple’s general living expenses (e.g., groceries, dining out together, vacations, etc.). What are the tax implications for Nik and Tom, respectively? Does the assessment change if the costs are paid not from a joint account but from their own separate accounts?
- Nik and Tom have no children. They therefore want to ensure that, in the event of one’s death, the other can remain in the house. What civil law options are available for mutual protection? What are the tax implications of these options?
- Tom and Nik’s relationship is falling apart. They are discussing what to do with their shared home. Their options include selling the property on the open market for an estimated price of CHF 1.9 million or having Tom transfer ownership of the property to the other at that price. From the proceeds of the sale, Nick receives CHF 100k (his original investment) and half of the capital gain of CHF 200k, for a total of CHF 200k. What are the tax implications?
2. Facts
Lea and Rolf live in Burgdorf with their two children (ages 4 and 2) in a rental home. They are both secondary school teachers. Rolf works 80% of a full-time schedule (salary: CHF 96k), and Lea works 40% of a full-time schedule (salary: CHF 48k). Thanks to the flexibility of their schedules, they are able to manage childcare for their young children well with occasional help from the grandparents.
With the birth of their children and the resulting reduction in their work hours—Rolf cut his hours from 100% to 80%, while Lea had already been working only 80% to make time for her horse—their disposable income has decreased significantly.
This raises the question of how to classify the various contributions each of them makes to the family:
Questions
- Lea and Rolf’s salaries are each deposited into their own accounts. From these, each pays their individual health insurance premiums, sets aside the estimated tax amount, contributes to a 3a pension plan, and keeps 1,000 CHF for personal expenses (clothing, hobbies, going out with friends, hair and beauty treatments, etc.). The remaining amount goes into a joint household and family account. This money is used to pay for all expenses related to the family or the couple (especially rent, vacations, groceries, the children’s needs, etc.). Since Tom earns more than Lea, the amount he transfers to the joint account each month is greater than Lea’s contribution. What are the tax implications of this arrangement?
- Lea and Rolf’s salaries are deposited into a joint account. From this account, all individual and joint expenses are paid (including tax bills, health insurance premiums, Pillar 3a contributions, etc.). Each month, an average surplus of CHF 300 from this account is transferred to a fund savings plan for both Lea and Rolf. What are the tax implications of this model?
- Rolf has reduced his work hours by 20% for family reasons, and Lea has reduced hers by 40%. Since she has reduced her hours more than he has, he transfers a “childcare allowance” of 10% (i.e., CHF 1,000 per month) to Lea. To cover the couple’s and family’s expenses, Lea and Rolf each transfer an equal amount to a joint household and family account. Personal expenses (e.g., tax bills, health insurance premiums, Pillar 3a contributions, mutual fund savings plans, etc.) are paid from their individual accounts. What are the tax implications of this model?
- Which of the above models is the fairest, and which is the most tax-efficient?
3. Background
Lea and Rolf (see Case 2) are thinking about their retirement planning. As their children get older and childcare needs decrease, they can once again work a higher percentage of full-time hours. Lea is now working 80% again. Rolf has kept his work schedule at 80% and uses his day off for triathlon training, a new hobby he has discovered. Lea uses her day off for longer horseback rides. Both are now earning roughly the same amount again.
Lea and Rolf have no joint savings. Regardless of the financial model they chose (Case 2), the couple made sure that each received the same amount to meet their personal needs or to save. In the past, Rolf was always a better saver than Lea. For her, much of the money set aside for personal needs and savings went toward her horse.
Because she worked fewer hours when the children were young, Lea has significantly less pension capital. The couple is discussing how Lea’s retirement situation can be improved.
Questions
- What solutions would be fair? Explain your reasoning!
- What tax implications must Lea and Rolf consider?
4. Facts
Lea and Rolf (see Facts 2) are separating. The children are 5 and 7 years old. This raises several questions:
Questions
- Lea and Rolf have joint assets (a joint household and checking account) as well as household goods and furniture. How are these assets divided in the event of a separation? What are the tax implications?
- Lea and Rolf recently leased a family car. What needs to be considered in this case?
- As part of the separation, Lea is demanding compensation for lost retirement savings due to her childcare responsibilities. Is this claim justified? If so, in what amount? What are the tax implications?
- Alternative scenario: Lea did not work as a teacher but as a florist with a salary of CHF 60k (for full-time work). Due to the significant difference in salary, Lea cared for the children full-time, while Rolf worked full-time. How should a fair pension rights equalization be handled in this case? What tax implications need to be considered?
