We are still finding that very serious mistakes are being made in connection with VAT. Where are the major risks lurking with VAT?

• VAT is charged 1:1 on the import receipts, which is the import tax. This can be reclaimed in full. Create a separate VAT code in the bookkeeping for the import and a VAT code for the 100% VAT and check at the end of the year whether you have claimed all import taxes.
• As a rule, all incoming payments must be settled with VAT for companies subject to VAT, i.e. including sales of tangible assets or the charging of personnel costs. We often see that this is forgotten. Non-taxable turnover and exempt turnover are regulated in Art. 21 of the VAT Act. In companies, these are often interest income or long-term rental of premises. If these turnovers reach a certain level, this leads to input tax reductions.
• Be aware, if you sell real estate from a taxable business, there are important questions to decide. Do you sell the property with VAT, without VAT or, if necessary, using the notification procedure? There is a great risk of paying too much or too little tax here.
• If you receive subventions, donations or grants, such as for solar installations, there are certain types that lead to a reduction in input tax and others that are considered " non-compensation" in accordance with Art. 33 VAT. This distinction is not always logical and often concerns a lot of money.
• Of course, no input tax may be claimed on private expenses paid by the business and VAT must be paid on private parts, e.g. for the business vehicle. Keeping several vehicles for one person can also be expensive. For the second vehicle, the Federal Tax Administration generally demands VAT on a market rental value and is no longer satisfied with the private part.

If you are unsure, you can also ask the Federal Tax Administration whether it can carry out a voluntary audit. We also have mandates where we regularly check the accounting for tax issues so that there are no surprises.

But now the VAT rate change from 7.7 % to 8.1 % is just around the corner. We have already reported on this in detail. Remember - the time of service or delivery is decisive - not the date of the invoice or payment!

Please contact me and we will see together where we can support you.

+41 41 226 30 52
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