Starting or running a business?
Discover everything you need to know about doing business in your country from one of the Ye! country guides. We have kick-started a few and will be adding more. Check it out and stay tuned!
Tax
Which taxes does an entrepreneur have to pay? How much?
Please click here for an overview of the taxes in Switzerland. The taxes commonly applicable for entrepreneurs are:
Corporate Tax (CIT)
Also known as business tax, CIT is a tax imposed on businesses incorporated in Switzerland and which derive income from within Switzerland and is charged at federal (government), cantonal and municipal level. The CIT rate in Switzerland is approximately 12%-28% which is charged on the profit before tax.
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On a federal level, the Swiss Federation levies a flat tax rate of 7.8% on profit before tax.
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The effective canton and municipal tax rate is approximately between 10% and 20% which is different for all the 26 cantons and varies from municipality to municipality.
Capital tax
Capital tax is imposed on cantonal and/or communal level at a rate of approximately 0.3%-0.6% of net-worth. The exact rate depends on the tax status of the company.
Value Added Tax (VAT)
VAT is an indirect tax on the consumption of goods and services. A person that is registered for VAT is called vendor. VAT must be included in the selling price of every taxable supply of goods or services made by a vendor. The current standard VAT rate in Switzerland is 8%. Companies have to register for VAT when having a turnover that exceeds CHF 100,000
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For accommodation services a VAT rat of 3.8% applies
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Food, water, agricultural products, medical products, books, newspapers and cultural services are exposed to a VAT rate of 2.5%.
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Public health, social services, education, gambling and exported goods are exempted from VAT.
Employees Tax
Employers are required to withhold employees’ income tax from their salary (see mandatory contributions for more information).
Stamp Duty
Stamp duty of 1% is imposed on contributions to capital that has an equity exceeding CHF 1 million. Furthermore a stamp duty of approximately 0.15% to 0.3% applies to certain transfers of securities.
Real Estate/Capital Gains Tax
The Capital Gains Tax rate depends on the canton where the property is located. The rates are set by each canton and differ per canton.
Mandatory Contributions
Any incorporated business is obliged to pay contributions towards retirement, invalidity, loss of earnings and health insurance for its employees. Moreover, every employee has to be registered with the Social Insurance System in order to cover retirement, disability and accident insurance schemes.
When do I pay for my tax?
Income Tax
Self-employed persons need to pay their taxes directly with the Federal Tax Administration.
Employees Tax
Income tax (Federal Direct Tax) needs to be paid when an employees’ taxable income exceeds CHF 12,600.
In general, payment deadlines vary from canton to canton and apply for both federal and cantonal/communal taxes.
How do I pay for my tax?
Employers have to register with the Federal Tax Administration. When companies are registered with the Commercial Register and turnover exceeds CHF 100,000, it is most likely that the company is automatically registered for tax purposes.
