What is VAT?
Introduction
In this article we will discuss the basics and particularities of Swiss VAT.
La TVA (taxe sur la valeur ajoutée) est un impôt indirect sur la consommation. Elle concerne, en principe, tous les biens et services consommés ou utilisés en Suisse.
C’est le consommateur final qui supporte la TVA. Mais il revient aux entreprises d’assurer la collecte de cet impôt et de la reverser à l’Administration Fédérale des Contributions.
Activités exclues
Some activities are excluded from the scope of VAT, mainly medical, educational, cultural, insurance, financial and residential rental activities. For more details see Art.21 al.2 LTVA.
Depending on the amount of turnover achieved, a company may or may not be exempted from VAT liability. Different methods are available to the company, including the effective method or the net tax liability method (NTR).
Swiss VAT liability
Once subject to VAT, all sales and services of a company will be subject to VAT. M
VAT is calculated on the amount excluding VAT of the services. The company's invoices will have to comply with the conditions laid down by Art. 26 LTVA as regards the form and information contained therein.
The form requirements for an invoice are as follows :
- Full contact details of the supplier and its VAT number
- Coordonnées du client (nom, adresse)
- Invoice date or date of performance if not identical
- Description of the service, type, purpose and volume of the service
- The amount billed
- Le taux appliqué à la prestation (le montant ne suffit pas)
Compulsory liability
Anyone who runs a business, even a non-profit one, and regardless of the legal form, is in principle liable to pay VAT in Switzerland.
It should be noted that the tax liability is not compulsory for companies that generate less than CHF 100'000/year from taxable services in Switzerland.
In order to determine the CHF 100,000, the worldwide revenues of the company must be included in the calculation, as they are decisive for the tax liability. This can be for example :
- All deliveries of goods and services taxable on Swiss territory
- All deliveries of goods and services exempt according to Art.23 LTVA
- Benefits excluded from the scope of the tax according to Art.21 al.2 VAT.
- Amount determining the VAT liability
Voluntary VAT liability
Art.11 LTVA provides that any person/company carrying out an entrepreneurial activity may voluntarily register for Swiss VAT.
- For a minimum duration of at least one fiscal period
- No minimum threshold (turnover)
- Voluntary liability is possible during the year
Opting for services excluded from VAT
Art.22 al.1 LTVA provides for a voluntary VAT liability for persons exercising an activity excluded from the scope of taxation according to Art. 21 LTVA.
However, the option is not available for the activities of :
- Insurance field
- Domaine financier
- Gambling area
- Real estate if the object is used or intended to be used exclusively for residential purposes
Start of VAT liability
Company with its headquarters, domicile or permanent establishment on Swiss territory
At the beginning of the entrepreneurial activity
Exemple d'assujetissement 1
Création de la Société ABC SA
31.12.2022
Does not exceed the CHF 100,000 threshold in the first year
31.12.2023
During the year 2023 the 100'000 CHF mark is exceeded
01.01.2024
La société ABC SA sera assujettie à la TVA dès le 01.01.2024
Exemple d'assujetissement 2
Création de la Société ABC SA
31.03.2022
It generates more than CHF 25,000 in taxable benefits
01.04.2022
She decides to be subject to the law from the 1st day of the 4th month
01.04.2022
She is careful and modifies her invoices in order to charge VAT
Il est important pour une entreprise Suisse de faire une évaluation de son chiffre d’affaires après 3 mois d’activité. Si le chiffre d’affaires dépasse 25’000 CHF la société a le choix entre:
(1) s’assujettir à la TVA à partir du premier jour d’activité. Elle pourra ainsi récupérer la TVA payé durant ce temps, mais devra également payer la TVA sur son chiffre d’affaires imposable en Suisse réalisé durant les 3 premiers mois d’activité.
(2) Commencer son assujettissement après le 1er jour du 4ème mois. Elle évite ainsi de régler la TVA sur son chiffre d’affaires pour lequel elle n’a pas pu prélever la TVA mais ne pourra pas récupérer la TVA sur les achats et investissements fait durant les 3 premiers mois.
End of VAT liability
Company with its headquarters, domicile or permanent establishment on Swiss territory
on the cessation of the entrepreneurial activity
In case of liquidation
on closure of the liquidation proceedings
All other companies
at the end of the calendar year in which they last provided services in Switzerland
Si le chiffre d’affaires de l’assujetti n’atteint plus le montant déterminant de CHF 100,000 et qu’il y a lieu de supposer que le chiffre d’affaires déterminant ne sera pas atteint non plus pendant la période fiscale suivante, l’assujetti doit l’annoncer.
Il peut le faire au plus tôt pour la fin de la période fiscale au cours de laquelle le montant déterminant risque d’être atteint. Sa renonciation prendra effet dès la période fiscale suivante. S’il ne le fait pas, il est réputé vouloir rester assujetti de façon volontaire.
Il convient d’être rendu attentif qu’en cas de fin d’assujettissement à la TVA, un calcul rétroactif pour tous les achats/investissement sur lesquels la TVA a été récupérée devra être fait. Cela s’explique par le fait que ces objets vont passer de servir à la cause entrepreneuriale à une cause privée, il faudra donc faire une correction de la déduction de l’impôt préalable (CORDIP).
Taux de TVA en Suisse en 2024
The VAT rates in Switzerland are as follows :
8.1% Taux normal
Art.25 al.1 LTVA
This is the rate that is generally used in the provision of services and the sale of goods.
Par exemple, est soumis au taux de 8.1% : Conseil fiscal, Prestation de peinture, Repas pris sur place, Toute vente de bien ou services n’étant pas soumis aux taux de 2.6% ou 3.8%
2.6% Taux réduit
Art.25 al.2 & al.3 LTVA
This rate applies in cases explicitly covered by the law, including :
- Foodstuffs (except alcoholic beverages)
- Medicines - Art.49 OTVA
- Newspapers and magazines without advertising character - Art.50 OTVA
3.8% Taux spécial
Art.25 al.4 LTVA
Ce taux concerne le secteur de l’hébergement. Par secteur de l’hébergement on entend le logement avec petit déjeuner même si celui-ci est facturé séparément.
How to register for Swiss VAT?
- Extract from the Trade Register and your IDE number
- For simple companies not registered in the commercial register, your social insurance number
- Chiffres d’affaires réalisé la première année ou perspectives de chiffre d’affaires
- Représentant fiscal pour les entreprises étrangères
Une fois les différents formulaires remplis et envoyés, il est possible que l’AFC vous contacte avant de vous assujettir à la TVA.
You will then receive confirmation of your registration and your first VAT deduction code directly at home.
Where can I find the VAT number of another company?
Are you looking for a company's VAT number to find out whether it is subject to VAT or not? You can visit the Confederation's official website at IDE register.
Just type the company name in the search bar, click on the company name, go to the bottom of the page to "VAT data" and see if the company has a VAT number.
The VAT number is the company's CHE number with VAT at the end.
Example : CHE-000.000.000 VAT
Completing a VAT statement
As a VAT payer, you are obliged to submit a detailed statement of the services provided every quarter or half-year. You can choose between two methods.
En règle générale le décompte est établi selon la méthode effective.
The Swiss VAT statement can be filed directly online.
Effective method
This method allows you to recover the VAT paid on your expenses and investments from the tax you have to pay on the services provided.
This statement must be made quarterly.
Exemple de calcul méthode effective
- 10’000 CHF (HT) de ventes imposables et 5'000 CHF (HT) d’achats avec de la TVA déductible du 01.01.2024 au 31.03.2024
- 810 CHF de TVA due
- 405 CHF de TVA Déductible
- 405 CHF en faveur de l’Administration Fédérale des Contributions
Remarks :
The tax on acquisitions has no impact with the effective method.
Import tax paid at customs is also recoverable.
Method Net tax debt rate
Exemple de calcul méthode taux dette fiscale nette
Cette méthode ne vous permet pas de récupérer la TVA. Mais elle est relativement simple à appliquer. Il vous suffit de prendre votre chiffre d’affaires et de le multiplier par le taux qui vous a été assigné par l’AFC selon votre activité. (see rate list)
This count must be performed semi-annually.
- Entreprise de nettoyage, taux appliqué de 5.9 % | Chiffre d’affaires : 80'000 CHF (TTC) de ventes imposables du 01.01.2022 au 30.06.2022
- 80'000 CHF * 5.9% = 4'720 CHF de TVA due en faveur de l’AFC
- 405 CHF de TVA Déductible
- 405 CHF en faveur de l’Administration Fédérale des Contributions
To benefit from this method two conditions apply:
(1) Le chiffre d’affaire annuel ne dépasse pas 5’005’000 CHF.
(2) Le montant de TVA calculé avec le taux dette fiscale nette ne dépasse pas 103’000 CHF.
Remarks :
You can use a maximum of 2 rates. For example for a restaurant that sells take-away and on-site services or a garage that does mechanics and bodywork.
Acquisition tax is due at the normal rate, if you use services from abroad you will have to pay tax on this service.
The tax on imports is not recoverable either.
VAT payment and deadlines
Vous avez 60 jours après la date de période du décompte pour déposer votre décompte TVA et payer la TVA due à l’aide de la QR-facture située en deuxième page de la feuille récapitulative.
Le délai dépassé, un intérêt moratoire est dû sur le montant de la TVA due.
It is possible to request a delay for the submission of the statement of account. This avoids a request for a provisional advance payment and possible summonses, but not the accounting of default interest.
Ce principe s’applique également à l’AFC qui est tenue de vous rembourser dans les 60 jours après le dépôt de votre décompte TVA faut de quoi elle vous doit des intérêts moratoires à partir du 61ème jour.
Advantages of registering for VAT
- Recovery of VAT on your investments and expenses
- Gain credibility with professional clients
Disadvantages of registering for VAT
- Augmentation des tarifs (du moins pour les privés qui ne la récupèreront pas)
- Increased administrative burden
- VAT issues (exempt or not; end of tax liability; CORDIP; REDIP; PASM)
Acquisition tax: what is it?
The acquisition tax puts Swiss and foreign companies on an equal footing.
For the actual counting method :
The acquisition tax must be reported under number 381 of the VAT statement as tax due and the input tax can be reclaimed. The transaction is therefore not relevant.
The Net Tax Debt Rate Settlement Method :
The acquisition tax must be declared under number 381 of the VAT statement as tax due and the input tax cannot be reclaimed. The transaction ends with the obligation to pay VAT at the rate that would be applied to the same service in Switzerland.
Companies not subject to VAT:
The acquisition tax is indeed due if you exceed the annual deductible of CHF 10'000 for services from abroad. Once the threshold has been exceeded, the taxpayer must declare the amount to the FTA within 60 days after the end of the calendar year.
- Consulting services from abroad (e.g. legal, tax advice, etc.)
- Services from abroad (e.g. visual creations, website, etc.)
- Advertising services from abroad (e.g. Google, Facebook, etc.)
Services that are excluded from taxation under Art. 21 VAT Act or exempted from taxation under Art. 23 VAT Act are not subject to acquisition tax.
Import tax: how does it work ?
When importing goods into Switzerland by a Swiss company, the importer must pay VAT.
The VAT on imports is levied by the Federal Customs Administration (FCA). This measure is mainly aimed at not disadvantaging Swiss companies that make their purchases in Switzerland and therefore pay VAT from those who import goods from abroad.
The VAT rate applied upon importation is the same as it would be if the good was purchased in Switzerland. It can be normal or reduced for food products, medicines, etc.
The calculation of the VAT, is based on the invoice price by the supplier of the goods to which are added the costs to the place of destination in Switzerland. The foreign VAT is not taken into account in this calculation as long as it is clearly indicated on the invoice or in the sales contract.
A proof must of course be given to the customs office at the time of importation (e.g.: invoice, sales contract, etc.).
The importation of certain goods is tax free see Art.53 LTVA.
For the actual counting method :
Import taxes can be recovered.
Condition: The importer is in possession of the VAT tax ruling from the Federal Customs Administration, issued in the importer's name and address.
The Net Tax Debt Rate Settlement Method :
The import tax cannot be recovered for the taxpayer deducting the VAT according to the net tax liability rate the import tax remains an expense.
For companies not subject to VAT:
For those not subject to VAT, the import tax remains a burden.
Notre conseil fiscal en matière de TVA
It is important to make the right choices at the beginning of the entrepreneurial activity, especially with regard to :
- L’assujettissement
- Les prestations convenues ou reçues
- Le choix de la méthode de décompte effectif ou taux de la dette fiscale nette.
These decisions will have a direct impact on your business. Being supported from the outset by a specialist will help you avoid making mistakes. Don't hesitate to get in touch with Tax Services.
In addition, depending on the activity you carry out and the current state of your business, various VAT-related issues will come into play. The respect of the VAT rules will save you from penalties in case of control.
