On 1st January 2018 a partial reform of the Swiss VAT legislation enters into force, the aim of which is to eliminate the competitive disadvantages related to the different VAT treatment between companies based in Switzerland and foreign companies.
Starting from 1st January 2018 the main regulatory changes for VAT purposes concerning companies based abroad are as follows:
- The compulsory VAT liability of companies based abroad – with consequent registration in the Register of VAT payers in Switzerland – no longer depends on the turnover achieved in Switzerland, as until 31.12.2017, but on the turnover achieved worldwide.
- Whoever, regardless of turnover, carries out business based abroad and performs exclusively one or more of the following services or supplies in Switzerland, is exempt from taxation:
- Services exempt from Swiss tax;
- Provision of services performed on Swiss territory (however, those who provide services in the field of information technology or telecommunications to non-taxpayers are not exempt from tax liability)
- Supply of electricity in gas pipelines, through the natural gas distribution network and district heating to taxpayers in Switzerland;
– The standard VAT rate is reduced from 8% to 7.7%
A foreign-based company that is liable for VAT in Switzerland must be represented by a tax representative domiciled in Switzerland at whose address the tax domicile for everything related to the value added tax is guaranteed.
The Swiss tax representative provides for the registration of the foreign company in the Register of VAT payers in Switzerland and for the fulfilment of the various tax obligations.
Zunarelli – Studio Legale Associato is available for further in-depth analyses and has entered into agreements with Swiss professionals able to perform the above-mentioned fulfillments, both during the preliminary phase of registration in the Register of VAT payers and during the activity carried out in Switzerland.
(Bologna Office– Massimo Campailla – 0039 (0)5 12750020)
