Swiss Corporate Income Tax (CIT) is levied at three levels: federal, cantonal and communal. The federal statutory CIT rate is 8.5%, but taxes are deductible when calculating taxable to give lower income effective tax rates. The cantonal and communal tax rates vary per canton and municipality, such that the total (federal, cantonal and communal) effective CIT rate generally ranges between 12% and 22%.
Corporate capital tax is only levied at the cantonal and the communal levels and is based on the net equity of a company. The ordinary capital tax rates vary between 0.001% and 0.5%, depending on the company’s location of corporate residence in Switzerland.
VAT is generally payable on annual turnover generated in Switzerland more than CHF100,000.
Under the Swiss tax reform of 2020, the introduction of an OECD-compliant patent box regime was mandatory for all cantons, reducing CIT on income from qualifying patents upon request. This provides tax relief of a maximum of 90% of the income derived from patents and similar rights at cantonal level. In most of the cantons there is also a further option to apply for an ‘R&D super deduction’ of up to 50% for qualifying R&D costs.
Please contact us if you have any questions or queries and your local representative will be in touch with you as soon as possible.
