Private Client Services

Wealth and Estate Planning

The Swiss banking industry ranks among the best in the world, managing total assets of around CHF7.3 trillion. Roughly half of this figure is attributable to foreign customers. The Swiss financial centre leads the world in cross-border wealth management with a market share of 27%. Switzerland has achieved this position through attractive operating conditions as well as a highly competitive and innovative banking industry.

Swiss banking successfully combines traditional strengths such as stability and universality of services with innovation in areas such as fintech and sustainable finance. Customers can count on a broad selection of high-quality financial services, as well as the legal certainty and stable conditions Switzerland offers. Switzerland is a preferred location for foreign financial institutions because they benefit from Switzerland’s reputation, business-friendly environment and large pool of talent.

Sovereign Trust (Switzerland) can assist high-net-worth individuals and their families in Switzerland on the most effective structuring of their assets.

Swiss Residence

There has been and continues to be strong interest in Switzerland as a jurisdiction for relocation – whether that be for wealth or business owners, or family offices seeking a stable jurisdiction from which wealth can be managed. High living standards, world-renowned educational system, stunning Alpine locations and competitive tax rates make Switzerland a highly attractive place of residence.

Non-Swiss citizens taking up residence in Switzerland who do not carry out a gainful activity in Switzerland can opt for the special tax regime of ‘lump-sum taxation’ based on expenses, which can offer up highly attractive planning options. Instead of basing the tax rate on global income and assets, it uses the taxpayer’s lifestyle expenses as an alternative tax base. Once the tax base has been determined, it is then subject to ordinary tax rates.

The specific rules of the lump-sum taxation regime will vary according to the tax policies of the canton where the individual or family wishes to take up residency. There are, however, minimum requirements for the granting of the lump-sum taxation regime, such as a minimum income and wealth tax basis.

For example, in the canton of Zug where our Swiss office is located, requires a minimum income tax basis of CHF1 million and a minimum wealth tax basis of CHF20 million for non-EU/EFTA nationals. This results in a total tax amount of approximately CHF300,000 per year for the income and wealth taxes.

Sovereign can assist high-net-worth individuals and their families in Switzerland with relocation, immigration and residency matters.

Trustee Services

There is currently no Swiss substantial law on trusts and therefore no provision for a Swiss domestic trust. However, a trust can be established under foreign law and, since 2007 when Switzerland ratified the Hague Convention, trusts are recognised as a legal structure.

Generally, the trust itself is never subject to tax due to a lack of legal personality. Furthermore, trust assets and income cannot be attributed to the trustee or the protector. Therefore, trust a Swiss resident trustee can manage assets without triggering a tax liability on the trust assets and income. However, in certain cases Swiss residents will be liable to tax on the assets as well as the income.

In January 2022, the Swiss Federal Council published a draft Bill aimed at introducing trusts into Swiss law. The proposed provisions, which will be included in a new chapter of the Code of Obligations, will enable trusts to be used both to structure private assets and for commercial transactions.

Sovereign has more than 30 years’ experience of setting up and managing various types of trust around the world. Sovereign Trust (Switzerland) can, through our partners, act as trustees in Switzerland.