What is a life annuity and what should I do for taxes in Switzerland?

Whether you own a property in life annuity or you receive a life income, we tell you everything in this article.

If you own a life annuity, you must declare it on your tax return.

If you have received income from life annuities or a life maintenance contract, you must declare 40% of the amount received during the year.

You will be asked the questions on the Fiduvaud platform.

But what is the viager ?

The principle of the life annuity is simple. The buyer pays the seller a bouquet (sum in the form of capital) at the signature of the contract and a life annuity "for life". The annuity is constituted for the benefit of a person. In this case, the annuity will be paid until the death of the last living person.

There are several types of life annuity:

The occupied life annuity

The occupied life annuity, represents approximately 90% of the sales in life annuity. The occupied life annuity is the sale of a real estate whose salesman reserves a right of use and a right of dwelling on the good. The seller can therefore continue to live at home, without changing his habits, until his death while receiving an annuity for life.

The free life annuity

The free life annuity is a real estate sale where the buyer can freely dispose of the property. The buyer can occupy or rent the property at his convenience. As for the occupied life annuity the salesman benefits from a bouquet at the signature as well as an annuity guaranteed for life. In the free life annuity the rent and the bouquet are generally higher than in the occupied life annuity because there is no right of habitation.

The forward sale

The term sale corresponds to the sale of a real estate where the purchaser pays a cash bouquet and monthly payments but over a defined period (for example 3 years, 5 years, 10 years). The seller can, in the case of an occupied term sale, reserve the right of use and habitation. Contrary to the life annuity with the term sale there are no uncertainties of duration.

The life annuity

The life annuity is an insurance which, in exchange of a capital (at the time of a sale in life annuity the capital represents a share of the selling price of the good), guarantees you a regular income for life. The buyer will continue to pay you this income even if the capital is exhausted. Life annuities allow you to protect your spouse in case of death and to benefit from considerable tax advantages for both the buyer and the seller.