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How to reduce tax
rates in Switzerland

 
Swiss taxes are much lower than those of our European neighbors (both for companies and individuals). In comparison with the most countries of the EU and with the USA, where the tax is between 30% and 55% on net income, total taxes in Switzerland amount to approximately 22%. Furthermore, taxes themselves can be deducted from the income as an expense, that results in significantly lower effective tax rate, compared to most other countries where taxes are not deductible.
 
Swiss tax system is strongly influenced by the federal structure of the country (the federal corporate income tax rate is 8.5% flat).
Each Canton, consequently, has its own tax laws. Tariffs, tax rates, as well as exemptions, remain within the competence of each Canton.
 
Today, all Cantons can offer tax relief as an incentive to attract foreign companies, as well as to encourage the start-up of new companies. Switzerland, as a business location, is therefore also attractive from a tax viewpoint.
 
 Income subject to tax
 
Corporate income tax is based on worldwide gross income (comprises of all types of income, including sales income, dividends, interest, rents, royalties, foreign-source income, domestic and foreign capital gains).
 
Dividend received and capital gains are taxable as ordinary income. However, there are some exceptions under the participation exemption.
 
Swiss branch of a foreign company pays the same rates of corporate income tax on profits, income and capital gains as would be paid by a Swiss-resident corporate entity.
However, profit repatriated abroad by the branch, is not subject to any tax in Switzerland.
 
 Deductions
 
Generally, all expenses incurred in the normal course of business are deductible from taxable income. Corporate income tax as well as salary and provisions for future employee retirement liabilities are also considered a deductible expense in computing taxable income.
 
Losses of the foreign branch can be set off against the profits of the Swiss-resident company. Where there is no double taxation treaty in place, withholding tax deducted in a foreign jurisdiction on remittances paid to a Swiss entity, give rise to a tax credit in Switzerland.
 
For both federal and cantonal tax purposes, deductions are allowed for the depreciation of property, plant and equipment (excluding land) and for the amortization of certain intangible assets, such as purchased goodwill related to the purchase of net assets, but not for the purchase of shares. Special accelerated depreciation might be negotiated with the tax authorities for major new manufacturing investments, particularly when such investments will create jobs or maintain current employment.
 
 Negotiating tax arrangements
 
We provide personalized assistance in registration with the Swiss tax authorities and finding a high-qualified accountant to manage your bookkeeping in accordance with the internationally accepted standards.
 
You can also obtain a number of tax exemptions in Switzerland. These exemptions can reduce the already moderate tax burden in Switzerland to extremely attractive levels. We can negotiate these arrangements with the tax authorities to help you benefit from the unparalleled Swiss tax environment.
 
 
Want to optimize your taxation?
  
 
 
The basic principle of the
Swiss tax system
 
Self-declaration by
the taxpayer
 
DOCUMENTS
 
International tax comparison:
taxes in % of Net Income

 
Corporate tax in Switzerland:
intercantonal comparison

 
Income tax in Switzerland:
intercantonal comparison

 
Advantages of the
Swiss tax system

 
VAT in Switzerland:
international comparison

 
 
SERVICES AROUND
YOUR TAXES
 

 
Tax calculator,
Pension calculator

 
 
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