Switzerland wealth tax and retirement visa for Americans (2026): the 55+ permit, cantonal wealth tax and why a US lifetime annuity likely fits
Written by Hans Goldstein, licensed insurance agent · CA 4273294Short answer: Switzerland's retirement permit for non-employed people aged 55 and over (AIG art. 28, VZAE art. 25) has no fixed franc figure for a single person or a couple: the means must exceed the level at which a Swiss resident would qualify for supplementary benefits, the canton decides case by case, and SEM must approve. Every canton taxes net wealth (roughly 0.1% to 1.0%), and according to the Federal Tax Administration annuity insurance with no surrender value is not subject to wealth tax, while a surrenderable contract stays taxable at its surrender value even after payments start. Since 1 January 2025 only a yield share of each foreign life-annuity payment is taxed as income (7% for tax year 2025). Confirm the details with the canton and a Swiss tax adviser (2026).
Free guide: Moving abroad on a fixed income
Income rules and taxes by country: Norway, Switzerland, Sweden, Italy, Spain, Malta and more, plus how a lifetime annuity fits.
Switzerland is the other European country, besides Norway, where a US lifetime annuity can do two jobs at once: show the stable means a Swiss retirement visa needs, and sit outside the Switzerland wealth tax. The rules are cantonal, so treat this page as the map, not the final answer for your canton.
The Swiss retirement visa (retiree permit)
Swiss federal law (Foreign Nationals and Integration Act, AIG art. 28) lets cantons admit non-employed persons aged 55 and over who have special personal ties to Switzerland and the necessary financial means. The ordinance (VZAE art. 25) sets the age at 55, gives examples of ties (longer earlier stays in Switzerland, close relatives living there), bars gainful work in Switzerland or abroad other than managing your own assets, and says the means are sufficient when they exceed the amount that would entitle a Swiss resident to supplementary benefits (Ergänzungsleistungen). There is no fixed franc figure. The cantonal migration office decides at its discretion and SEM must approve. SEM’s directives (section 5.3) add that the money must flow “with great certainty” to the end of your life, from pensions or assets. A documented lifetime income stream answers exactly that question.
| Item | What we know | Confidence |
|---|---|---|
| Minimum age | 55 | VZAE art. 25(1) |
| Means | Above the supplementary-benefits level, secure for life; no fixed franc figure | VZAE art. 25(4); canton decides, SEM approves |
| Ties to Switzerland | Required; owning property alone is not enough | VZAE art. 25(2); SEM directives 5.3 |
| Alternative | Lump-sum taxation (Besteuerung nach dem Aufwand) in most cantons | Abolished in Zurich, Basel-Stadt, Schaffhausen and Appenzell Ausserrhoden; Basel-Landschaft allows it only in the year of arrival |
Single or married: how much income you need
| Household | Means required | Who must have it |
|---|---|---|
| Single | Above the supplementary-benefits level; canton sets the working figure | The applicant (this is not a sponsor route) |
| Couple | Set by the canton; ask for the household figure and whether both spouses must meet the age and ties conditions | The applicants; the canton assesses the household |
| Each dependent | Set by the canton | Ask the cantonal migration office |
I could not find a published franc figure for a couple, so I won't invent one. For tax, Swiss law adds the income and wealth of spouses living together, regardless of their marital property regime (StHG art. 3(3)). The permit is based on your own means, so the "sponsor is not the breadwinner" problem of the Nordic spouse routes does not arise here.
Does Switzerland have a wealth tax? Yes, in every canton
Every canton taxes net wealth. Federal harmonization law (StHG arts. 13 and 14) sets the base as total net wealth at market value, and combined cantonal and communal rates run roughly 0.1% to 1.0% depending on where you live (Federal Tax Administration comparison of cantonal capitals). Allowances are set by each canton, and a married couple is assessed on combined wealth. Life and annuity insurance is valued at its surrender value under cantonal law. The Federal Tax Administration’s wealth-tax overview (law as of 1 January 2026) states that capital and annuity insurance that cannot be surrendered is not subject to wealth tax, and that in all cantons the surrender value of a surrenderable annuity stays taxable even after payments have begun. So a life-only annuity with no surrender value is outside the base; a contract you can still cash in is not. Confirm with your canton before you buy.
Compare that with keeping the same money in a portfolio: it is taxed every year as wealth, and its returns are taxed as income. If the canton confirms that your contract has no surrender value, converting part of your savings into lifetime income shrinks the wealth-tax base while producing the means the permit asks for. That is why, for many American retirees heading to Switzerland, a US lifetime annuity is likely one of the best options. Confirm it with a Swiss tax adviser and your canton.
Why I write about this. My mom is Norwegian, my dad is American, and they’re planning the move from the US to Norway. My mom is the sponsor (the host, or “reference person” in UDI’s words), so Norway’s income test falls on her income, not my dad’s. UDI told us in writing that money in an account does not count as income, and only lifelong income does. Their savings were not the problem; the paperwork wanted a monthly number in the host’s name. The rules in Switzerland are different, but the problem is the same one many retirees hit: the income test, not the net worth. I’m writing this to help others in the same boat as my parents. Read how we worked through the Norway income requirement.
In the same boat? Let’s run your numbers
See roughly what a lifetime annuity would cost to close your income gap, then get my personal read by email. I can help while you still live in the US.
Estimates use the September 9, 2026 ImmediateAnnuities.com payout survey (life only) and a 15% cushion. Illustrative, not a quote.
Example: a 62-year-old American moving to Switzerland
Because the canton sets the bar, start by asking the cantonal migration office what monthly means they expect for your household, then subtract Social Security (which can start at 62) and any pension. Here I assume a $3,000 monthly gap. Payouts are life-only averages per $100,000 at 62 from the September 9, 2026 ImmediateAnnuities.com survey: man $603, woman $582 (best quotes $660 and $637). Illustrative, not quotes; add 10 to 25% headroom for currency.
| Household | Monthly gap (assumed) | Premium needed (survey average) |
|---|---|---|
| Single man, 62 | $3,000 | About $500,000 |
| Single woman, 62 | $3,000 | About $515,000 |
| Couple, both 62, two single-life annuities of $1,500 each | $3,000 | About $506,000 (income halves at the first death) |
A joint and survivor annuity keeps the full payment for the surviving spouse but pays less per dollar than single life, so it needs more premium; get a quote. Before 59½ rules are not relevant at 62.
Which annuity counts
For the wealth-tax logic, what matters is that there is no surrender value: a life-only SPIA or joint and survivor SPIA, or an existing deferred annuity or MYGA converted to lifetime payments. Period-certain annuities, income riders where an account value can still be cashed out, and annuities still accumulating read as savings and, valued at surrender value, stay in the wealth base. To be honest about the permit: SEM’s directives name pensions or assets, so a canton may also accept substantial savings; the annuity’s edge is income that is certain for life plus the wealth-tax treatment.
How the annuity is taxed: Switzerland and the US
Swiss side. Switzerland taxes life annuities only on a yield share (Ertragsanteil), not the whole payment. The federal law of 17 June 2022 on the taxation of life annuities (AS 2023 38), in force 1 January 2025, rewrote the rules in DBG art. 22(3) and StHG art. 7(2):
- Guaranteed benefits from Swiss-law insurers: the taxable share is set by the maximum technical interest rate when the contract was issued.
- Surplus (excess) benefits: 70% taxable.
- Benefits from foreign life annuities (which covers a US SPIA): the taxable share is set by the 10-year average yield on Swiss federal bonds plus 0.5 percentage points. If that yield is zero or negative, the share is 0%.
The old flat rule that taxed 40% of each annuity payment no longer applies. For foreign annuities the share is recalculated every tax year: the Federal Tax Administration published 7% for tax year 2025 (average bond yield 0.11% plus 0.5 points). The taxed slice is added to your other income at federal, cantonal and communal rates.
US side. As a US citizen you stay taxable on worldwide income wherever you live. A US single premium immediate annuity bought with after-tax savings is taxed under IRC 72: an exclusion ratio makes part of each payment a non-taxable return of your premium until the premium is recovered. If you bought it with IRA money, every payment is taxable. The foreign earned income exclusion does not cover annuities (IRC 911(b)(1)(B)(i)). Foreign tax on the payments can be credited on Form 1116, through the treaty’s relief article where there is one. Since January 1, 2026, a US citizen with a foreign residence address cannot opt out of federal withholding, even if payments go to a US account (IRC 3405(e)(13), Treas. Reg. 31.3405(e)-1). Withholding is a prepayment, not extra tax. An annuity from a US insurer is not reported on FBAR or Form 8938, and it is not a PFIC.
| Treaty item (US-Switzerland 1996) | Rule |
|---|---|
| Annuities | Article 18(2): taxable only in the country of residence (Switzerland) |
| US citizens | The saving clause (Article 1(2)) lets the US keep taxing its citizens; Article 23(3) gives the special credit rules for a US citizen living in Switzerland |
| US Social Security | Article 19(4): taxable in Switzerland, and the US may also tax up to 15% of the gross; Switzerland then credits that and exempts one third of the net payment |
| Totalization agreement | The 2012 agreement, in force 1 August 2014, replaced the 1979 one |
Net result. Switzerland taxes only a small yield share (7% for 2025), while the US taxes the non-excluded part of each payment, so the US tax is usually the binding one and the Swiss income tax on the annuity is light. Add the wealth-tax treatment of a contract with no surrender value, and the annuity is tax-friendly in Switzerland compared with drawing down a portfolio that is taxed as wealth every year.
Practical steps
- Buy while you still live in the US. US insurers sell to residents of states where they are licensed.
- Choose a life-only payout with no surrender value; that is what keeps it out of the wealth base. If you add a refund or any cash-out feature, get the insurer to confirm in writing that the contract has no surrender value, and ask the canton.
- Start payments before you apply so you can show actual deposits.
- Ask the canton in writing about both the means test and the wealth-tax valuation.
The trade-off, once: an annuity cannot be undone, and a level payment buys less over time in a country with a high cost of living. In exchange you get income for life that supports the permit and, if the canton confirms, stays out of the wealth tax.
Frequently asked questions
Free annuity gap analysis for Switzerland. Tell me your ages, your Social Security or pension, and whether you are single or a couple. I will show how far your income is from the Switzerland requirement and what a lifetime annuity would cost to fill the gap, in the sponsor’s or main applicant’s name where that matters.
Related reading
- Moving abroad on a fixed income (hub)
- Wealth tax countries and annuities
- Norway wealth tax and the US annuity exception
- How European countries tax a US annuity
- The US exclusion ratio for annuities abroad
- Italy elective residence visa income requirement
Sources
- AIG (Foreign Nationals and Integration Act), art. 28, Fedlex
- VZAE (Ordinance on Admission, Residence and Employment), art. 25, Fedlex
- SEM directives on foreign nationals (Weisungen AIG), section 5.3
- ESTV: wealth tax of individuals (law as of 1 January 2026)
- ESTV: taxable yield share of foreign life annuities
- Federal law of 17 June 2022 on the taxation of life annuities (AS 2023 38)
- ESTV: income tax of individuals, lump-sum taxation by canton
- US-Switzerland social security agreement of 2012 (in force 1 August 2014)
- DBG (Federal Direct Tax Act), art. 22, Fedlex
- StHG (Tax Harmonization Act), arts. 3, 7, 13, 14, Fedlex
- US-Switzerland income tax treaty (IRS)
- ImmediateAnnuities.com: annuity rates by age (survey September 9, 2026)
- 26 U.S.C. 3405: withholding on annuity payments
Goldstein & Co. LLC dba Goldstein Insurance Services · Hans Goldstein, licensed insurance agent, CA lic. #4273294 · NPN 20602398 · 213-414-2808 · hans@hansgoldstein.com
Education, not tax, legal or immigration advice. Rules, thresholds and exchange rates change; confirm with the consulate or immigration authority and a local tax adviser before you act, and get answers in writing. Hans Goldstein is a licensed insurance agent (CA 4273294) and can only offer annuities to residents of states where he is licensed. Annuity payments are guaranteed by the issuing insurer’s claims-paying ability, not by any government. Payout figures are illustrations from a published survey, not quotes. Immediate annuities are generally irrevocable.