Swiss citizens who emigrate to Thailand before retirement age face different questions than someone who is already retired. At this stage of life, the focus is usually not only on changing one’s place of residence, but also on employment, pension provision, health insurance, taxes and long-term financial planning.
Precisely because retirement has not yet been reached, the move should be carefully prepared. Many decisions made before deregistering in Switzerland can later have significant consequences for pension entitlements, pension assets and insurance coverage.
Deregistration in Switzerland and Registration with the Swiss Representation
Anyone who definitively leaves Switzerland must deregister with their last municipality of residence. Swiss citizens who have deregistered in Switzerland should register with the competent Swiss representation abroad within 90 days. For Thailand, this is the Swiss Embassy in Bangkok. This registration is free of charge and facilitates contact in emergencies as well as formalities relating to identity documents, marriage, birth or death.
At the same time, it should be clarified before the move which visa allows long-term residence in Thailand. A reliable address in Thailand is also important, as it may be required by Thai authorities, banks, insurance companies and for registration with the Swiss representation.
AHV: Avoiding Contribution Gaps
A central issue when leaving Switzerland before retirement age is the AHV. Swiss citizens who move to Thailand and are no longer subject to the mandatory Swiss AHV risk contribution gaps. Such gaps can later lead to a lower old-age pension.
For Swiss citizens abroad with residence outside the EU/EFTA, it is generally possible to join the voluntary AHV/IV. One requirement, among others, is that the person must have been insured under the mandatory AHV for at least five consecutive years immediately before leaving the mandatory AHV and must apply for admission within the applicable deadline.
Before moving away, it should therefore be checked whether the requirements are met, which deadlines apply and whether the voluntary AHV/IV is financially worthwhile in the specific case. This point is particularly important for people who emigrate many years before retirement age. The earlier the move takes place, the greater the later impact on the AHV pension may be.
Pension Fund: Withdrawal or Vested Benefits?
Occupational pension provision should also be clarified before moving away. Anyone who definitively leaves Switzerland and moves to Thailand, meaning to a country outside the EU/EFTA, can generally withdraw the pension fund assets in full. Anyone who does not wish to withdraw the assets immediately can usually transfer them to a vested benefits account or a vested benefits policy.
For Thailand, retirements benefits should be carefully distinguished. According to the Federal Tax Administration (FTA) overview, ongoing pensions from private-law pension funds are not subject to Swiss withholding tax. In the case of lump-sum benefits from the 2nd pillar, withholding tax is initially deducted, but according to the FTA overview it can be reclaimed for Thailand.
Some pension institutions already provide an online form for moving to a third country. If not, the pension institution can be contacted regarding the procedure.
Pillar 3a: Withdrawal in the Event of Definitive Departure
Pillar 3a assets can also generally be withdrawn in the event of definitive departure from Switzerland. As a rule, this requires that deregistration from Switzerland has taken place and that the new residence abroad can be proven.
According to the FTA overview, pensions from pillar 3a are subject to Swiss withholding tax; for lump-sum benefits from pillar 3a, no refund is provided for Thailand. Before a withdrawal, it should therefore be checked from which pension institution the benefit originates and whether it is a pension or capital. For Thailand, the tax treatment must be examined individually.
Health Insurance
With the definitive departure from Switzerland, mandatory Swiss basic health insurance also ends. Anyone moving to Thailand should therefore organise a new health insurance solution at an early stage.
Depending on the situation, an international health insurance policy, a local Thai insurance policy or a combination of different solutions may be considered. It is important not only to look at the premium, but also at exclusions from coverage, age limits, existing pre-existing conditions, choice of hospital and repatriation.
Especially those who emigrate before retirement age should think long-term. Insurance that seems inexpensive today may later become expensive or no longer provide sufficient protection in old age.
Taxes
Anyone who transfers their centre of life to Thailand is generally only subject to limited tax liability in Switzerland. The centre of life must effectively be in Thailand; this means that if a person continues to spend a lot of time in Switzerland, a tax authority may possibly question this.
Even after moving away, Swiss tax consequences may continue to arise, particularly in relation to real estate in Switzerland, pension withdrawals, pensions or other income from Swiss sources.
Withholding tax on pension benefits is particularly important. If pension fund assets, vested benefits or pillar 3a assets are paid out after the move, Switzerland generally levies withholding tax. The amount is not determined by Thai law, but by the canton in which the pension or vested benefits institution has its registered office. The extent to which such income is taxed twice in Thailand must be examined individually in each case.
There is a double taxation agreement between Switzerland and Thailand. However, the double taxation agreement is not a general solution for all tax questions. It applies only to certain types of income and specific cases of application. It should therefore be examined in each individual case whether Swiss withholding tax remains definitively owed, whether a refund is possible and how Thailand treats the withdrawal or later pensions for tax purposes.
Swiss Bank Account and Financial Services
A practical but often underestimated topic concerns Swiss banking relationships. If a person is resident in Thailand, banks may restrict services, charge additional fees or no longer offer certain products. In the worst case, the bank may terminate the relationship.
Before moving away, it should be clarified whether existing accounts, credit cards, securities accounts, e-banking access and pension accounts can be maintained. SwissCommunity provides information on its website about the banking issue for Swiss citizens abroad and refers, among other things, to offers from Zürcher Kantonalbank and Banque Cantonale de Genève.
Once the change of residence has been completed, opening or adjusting a banking relationship can become significantly more difficult.
Family, Marriage and Assets in Thailand
Anyone who moves to Thailand permanently should also keep family and property law questions in mind. This concerns in particular marriage, partnership, joint assets, use of real estate and estate planning.
The legal rules in Thailand differ in some respects significantly from those in Switzerland. Further information on these topics can be found in separate articles on the NomadLaw blog page.
Conclusion
Anyone who emigrates to Thailand before retirement age should plan the move not only organisationally, but also from a social security, tax and financial perspective. Particularly important are AHV contribution gaps, pension fund assets, pillar 3a, health insurance, taxes and banking relationships.
Many of these points are easier to arrange while one is still registered in Switzerland. An early review helps to avoid later disadvantages and to place the new stage of life in Thailand on a stable foundation.
This article is for general information only and does not replace individual legal, tax or financial advice.
FAQ
Can I emigrate to Thailand as a Swiss citizen before retirement age?
Yes. Swiss citizens can generally also emigrate to Thailand before retirement age. However, it is important to prepare the move carefully. Particular attention should be paid to AHV, pension fund assets, pillar 3a, health insurance, taxes, banking relationships and long-term financial planning.
What happens to my AHV if I move to Thailand before retirement age?
Anyone who moves to Thailand before retirement age and is no longer subject to the mandatory Swiss AHV risks contribution gaps. Such gaps can later lead to a lower old-age pension. Under certain conditions, Swiss citizens abroad can join the voluntary AHV/IV.
Can I insure myself voluntarily under the AHV if I live in Thailand?
For Swiss citizens residing outside the EU/EFTA, there is the possibility of joining the voluntary AHV/IV. One requirement, among others, is that the person must have been insured under the mandatory AHV for at least five consecutive years immediately before leaving the mandatory AHV and must apply for admission within the applicable deadline.
Can I withdraw my pension fund assets if I emigrate to Thailand?
Anyone who definitively leaves Switzerland and moves to Thailand, meaning to a country outside the EU/EFTA, can generally withdraw the pension fund assets in full. Alternatively, the assets can usually be transferred to a vested benefits account or a vested benefits policy.
What happens to my pillar 3a if I move to Thailand?
Pillar 3a assets can generally be withdrawn in the event of definitive departure from Switzerland. As a rule, deregistration from Switzerland and the new residence abroad must be proven. The withdrawal has tax consequences and should therefore be carefully planned.
Will I remain in the Swiss health insurance system after moving to Thailand?
With the definitive departure from Switzerland, mandatory Swiss basic health insurance generally also ends. Anyone moving to Thailand should therefore organise a new health insurance solution at an early stage, for example an international health insurance policy, a local Thai insurance policy or a combination of different solutions.
Do I still have to pay taxes in Switzerland after moving to Thailand?
Anyone who effectively transfers their centre of life to Thailand is generally only subject to limited tax liability in Switzerland. However, Swiss tax consequences may still arise, for example in relation to real estate in Switzerland, pension withdrawals, pensions or other income from Swiss sources.
Is withholding tax levied on pension fund or pillar 3a withdrawals?
Yes. When pension fund assets, vested benefits or pillar 3a assets are paid out after the move, Switzerland generally levies withholding tax. The amount depends on the canton in which the pension or vested benefits institution has its registered office. It should be checked in advance whether such withholding taxes can be reclaimed.
Is there a double taxation agreement between Switzerland and Thailand?
Yes, there is a double taxation agreement between Switzerland and Thailand. However, it does not automatically solve all tax questions. It applies only to certain types of income and specific cases of application. It should therefore be examined in each individual case whether Swiss withholding tax remains definitively owed, whether a refund is possible and how Thailand treats pension withdrawals or pensions for tax purposes.
Can I keep my Swiss bank account if I emigrate to Thailand?
This depends on the respective bank. If a person is resident in Thailand, Swiss banks may restrict services, charge additional fees or no longer offer certain products. In the worst case, the banking relationship may be terminated. These questions should therefore be clarified before deregistering in Switzerland.
