"What is the difference between tax residency and permanent residency and/or citizenship?"

Although the terms "tax residency" and "permanent residency and/or citizenship" may seem similar, they serve very different purposes. Your tax residency is a financial status, while your permanent residency and/or citizenship is generally considered to be a legal status.

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However, subject to the country where you have permanent residency and/or citizenship, there may be certain tax obligations and reporting requirements, though this is separate to your tax residency. A notable example of this includes the citizenship-based taxation for US citizens.

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The key differences between the two are:

• Your tax residency does not grant any immigration or legal residency rights, unlike permanent residency or citizenship.
• Your permanent residency or citizenship status(es) does not automatically make you liable for taxes and is instead subject to the criteria for tax residency, as explained above, or if your country of citizenship has specific tax requirements.

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Tax residency

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Your tax residency is broadly determined by where you are currently living and earning income, which will often determine your obligation to pay taxes in a specific country. This is assessed through factors such as the number of days you spend in the country, your main residence, or your economic and family ties.

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For example, if you live and work in Switzerland for the majority of the year and maintain a residence here, you would likely be considered a Swiss tax resident.

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Permanent residency and/or Citizenship

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The country in which you have permanent residency or citizenship forms part of your legal status.

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• Permanent residency generally allows you to live and work in a country indefinitely. In some cases, there is a limit to how long you are allowed to live away from that country (in the case of Switzerland, this can be up to 4-years, specifically upon request)
• Citizenship, on the other hand, grants full legal rights and responsibilities in a country, including the ability to vote and hold a passport. Unlike permanent residency, citizenship is not subject to expiration, regardless of how long you live outside the country.

For example, you could be a citizen of one country while being a tax resident in another, depending on your living and income arrangements.

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‍Please note that all content within this response has been prepared for information purposes only. This response does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.‍