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TAX REPRESENTATION IN SWITZERLAND
TAX REPRESENTATION IN SWITZERLAND
Since 1.1.2018, VAT will be subject in Switzerland starting from the first franc if, globally, a company based abroad generates a turnover of at least CHF 100,000 in taxable services.
As long as it performs activities on Swiss territory, a foreign company is held - pursuant to art. 67 para. 1 LIVA - to have a representative domiciled in Switzerland, with whom the tax domicile is guaranteed for everything related to value added tax. A natural or legal person with domicile or headquarters in Switzerland is recognized as a tax representative.
VAT registration required
The reasons for the mandatory VAT registration in Switzerland for foreign companies include:
- Third party productions in Switzerland
- Services related to real estate or funds in Switzerland
- Assembly work in Switzerland
- Supply of electronics services in Switzerland
- All activities with physical presence in Switzerland
- Transportation of goods from Switzerland
Legal framework from 1st January 2019 for mail order sellers
The supplies of small consignments that a mail order seller (foreign or Swiss) transports or send abroad to Swiss territory for a turnover of at least 100,000 francs are considered to be supplies on Swiss territory. Consequently, the mail order seller is subject to tax in Switzerland and must register in the VAT register. The tax is due when the seller reaches the turnover limit of 100,000 francs. Once the seller is entered in the VAT register as a result of the mail order regulation, other consignments that exceed the import tax amount of 5 francs are also considered to be small deliveries in Switzerland. It follows that all services performed on Swiss territory are taxable for a mail order seller subject to tax..
The appointment of the tax representative must take place in advance of the provision of the service, also taking into consideration the processing times of the VAT office for opening the position.
BG Consulenze Sagloffers tax representation services for VAT purposes both to foreign companies that carry out commercial activities in Switzerland and to companies with domicile or headquarters abroad who make taxable purchases in Switzerland and could not deduct Swiss VAT.
