Taxation AG / GmbH

Federal taxes

There is a tax liability for legal persons when the headquarters or the actual administration is in Switzerland (Art.  50 DBG). At the federal level, there is only a tax on profits. Capital tax is not provided for.

The tax liability begins with the foundation or opening (move) of the actual administration to Switzerland or with the acquisition of assets with taxable values in Switzerland.  Tax liability ends with the completion of liquidation, relocation of the headquarters or the actual administration abroad and the elimination of assets with taxable values in Switzerland (Art.  54 DBG).

For federal tax purposes, legal persons / entities are divided into two distinct groups.  The first group includes capital companies (public company, limited liability company, limited partnerships) and the second includes associations, foundations and the other legal entities (Art.  49 DBG).

Holding companies benefit from tax relief (ratio of net income to net income from investments).  As a result, pure holding companies owe no income tax because they hold 100% of the equity. Capital companies and cooperatives are holding companies if they are at least involved with 20% of the nominal or share capital of another company or if their capital participation has a market value of at least CHF 2 million. This deduction is called an investment deduction.

Associations, foundations, public sector and religious bodies (churches) pay - if they are not exempt from tax due to charitable purpose - a tax on earnings or income tax at a tax rate of 4.25%.

Cantonal and municipal taxes

With regard to the place where the legal person / entity must pay their taxes, please refer to the execution of the direct federal tax.  Here, the seat of the actual administration is the decisive criterion.  An economic relation may possibly also be considered.

The vast majority of cantons provide for a tax on net profits, as well as the deposited share capital and the reserves thereof.  This applies to public companies and cooperatives.

Depending on the canton, a progressive, a proportional or a mixed tax rate is provided.  Holding and investment companies enjoy certain tax breaks in all cantons.  If these do not carry out business in Switzerland and the purpose of the administration includes the investments, no tax is incurred on the net profit.  This privilege only exists if the investments or the income from the investments has an amount of at least two-thirds of the total assets / income.  Furthermore, only a reduced capital tax is due for a holding company.