- Net assets of less than CHF 59,000 (2024) are tax-exempt for a single person
- Progressive rate: 0.24 ‰ - 3.39 ‰ for assets over CHF 2,000,000
- The tax is levied annually, on the basis of the calendar year.
- Residents, business owners and property owners are subject to wealth tax in the canton of Vaud.
Wealth tax applies to the total value of an individual's assets after deduction of debts. The Swiss Confederation does not levy this tax, and the cantons, including Vaud, have their own rules and scales. This article provides an overview of the key aspects of wealth tax, from calculation to payment.
Who is subject to wealth tax in the canton of Vaud?
People living or staying in the canton
Individuals who reside or stay in the canton of Vaud on a permanent basis or for an extended period are required to pay wealth tax at their place of residence or stay.
Persons not domiciled in the canton
Are subject to wealth tax in the canton of Vaud:
- Owners of real estate located in the canton or individuals enjoying such properties.
- Individuals who operate a business or a permanent establishment in the canton. This includes commercial or agricultural activities conducted within the canton.
Items subject to wealth tax
A taxpayer's wealth covers a wide range of assets. It includes both movable and immovable property. In particular, the following are subject to wealth tax:
- Movable assets: Market value of personal items, valuable furniture, etc.
- Real estate: Properties, land, and buildings assessed at their market value.
- Usufruct: Assets on which the taxpayer receives income are taxed in the hands of the usufructuary.
- Redeemable life insurance Surrender value including policyholder dividends.
- Commercial wealth: Assets invested in the operation of a commercial or agricultural business.
- Patents and similar rights: Taxed at 50% of their value.
- Securities: Estimated at market value.
- Assets invested abroad: Taking into account cantonal valuation rules.
- Securities and financial investments: Includes stocks, bonds and other investments.
Items exempt from wealth tax
- Household furniture: Furniture and household equipment used for personal purposes.
- Personal items for everyday use: Articles such as clothing, non-luxury personal jewelry and other goods intended for everyday use.
- Pension claims: Assets in occupational pension schemes (2nd pillar) and tied personal pension plans (3rd pillar A) are exempt as long as they are not due.
- Minimum assets: Net wealth of less than CHF 50,000 (CHF 59,000 from 2024) is exempt, with a double threshold for spouses living in a joint household.
- Housing rights and usufructs : These rights are not taken into account in the tax valuation of real estate.
Determining net worth in the canton of Vaud
Wealth tax in the canton of Vaud applies to the taxpayer's entire net wealth as of December 31 of the relevant fiscal year, after deducting debts and applicable exemptions.
In general, assets must be valued at market value. [Art.14 al.1 LHID] Market value means the price that would be obtained in the event of a sale under normal conditions.
However, some items can be valued at return value, particularly buildings and movable assets. The yield value is obtained by dividing the yield for a given period by a capitalization rate.
Moveable assets
Cash
Assessed at its nominal value as of December 31 of the fiscal year.
Based on the market value as of December 31, according to published rates.
Listed securities
Valued at their official closing price on December 31 of the fiscal year.
Valuation based on intrinsic value or tax-determining value (calculated on the basis of the company's equity, adjusted for recurring earnings).
Assessed at their market value, or if unavailable, at their intrinsic value, calculated similarly to Swiss securities.
Assessed at their net book value, as recorded in the recognized commercial accounts for income tax purposes.
Life insurance subject to surrender
Assessed at its redemption value as of December 31, including definitively acquired surplus participations.
Jewellery and silverware
Assessed at their market value (fair market value), unless they are items of everyday use, in which case they are generally exempt.
Assessed at their nominal value, reduced by any recognized risk of loss.
Real estate assets
Buildings
The tax value corresponds to the purchase price on the contract. Properties subject to usufruct are taxable with the usufructuary.
Foreign buildings
The purchase price of the property is converted into Swiss francs using the tax rate for the year of acquisition. Foreign assets are included only for the purpose of determining the tax rate.
Properties received as gifts/assignments
The tax value corresponds to the value retained by the tax authorities at the time of the event.
These types of property are valued taking into account the current value of the land, buildings and ancillary facilities.
Farm buildings
Valued at their return value, corresponding to the gross or net return capitalized at a specified rate, taking into account agricultural particularities.
Liabilities attributable to assets
To determine the net wealth, all unsecured debts (e.g., consumer loans) or mortgage debts (e.g., home loans) are deducted from the gross wealth.
- Mortgages on real estate
- Personal or business loans
- Debts incurred for major investments or purchases
- Extracts from negative accounts
Determining net assets
Wealth tax is levied on the taxpayer's total net wealth, which is made up as follows:
- Gross assets (furniture and real estate)
- Debt (mortgage, unsecured and private)
- Social deductions (depending on your situation)
- Net taxable wealth
Wealth tax calculation and scales
Wealth tax is calculated as a progressive percentage of net wealth.
- Taxable assets (CHF)
- Basic tax (CHF)
- Effective rate (‰)
- 50'000
- 100'000
- 150'000
- 200'000
- 350'000
- 600'000
- 1'050'000
- 1'600'000
- 2'000'000
- 23.65
- 77.90
- 162.40
- 267.35
- 634.75
- 1'422.25
- 2'926.40
- 4'790.90
- 6'146.90
- 0.473
- 0.779
- 1.083
- 1.337
- 1.814
- 2.370
- 2.787
- 2.994
- 3.073
