Which neutral connection is recommended, switched neutral or direct neutral?

It depends on where the switching is taking place. The key is to keep the live system always grounded and avoid grounding neutral at more than one point.

If you are looking at an application less than 600VAC, and you have multiple sources (such as utility and generator) and you have 4-wire loads, I usually recommend switched neutral as it allows complete isolation of the sources from one another, which refers to switching neutral of a transfer switch, where neutral switching would be 'required' (by codes such as NEC), if the two sources are independently grounded (separately derived systems) to avoid multiple neutral grounding and proper functioning of ground fault current sensing/protection. Code permits not switching the neutral as long as the system neutral is grounded at only one point.

This is not to be confused with breakers or switches used for disconnecting individual circuits or feeders, where switching the neutral is optional (by code) and when it is permitted, the neutral needs to be switched simultaneously with the ungrounded conductors. What is not permitted is disconnecting a neutral (or the grounded conductor to be more accurate), before disconnecting ungrounded conductors. The reason no fuse in permitted in a grounded conductor.

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