Overview of the tax law decisions of the Swiss Federal Supreme Court published in the week from 7 to 13 October 2019.

  • Judgment of 18 September 2019 (2C_849/2018): Direct federal tax and cantonal and communal tax 2005 (Geneva); the lower court rightly refused the deduction for a purchase in the 2nd pillar after divorce as a result of receipt within three years; dismissal of the taxpayer's appeal.
  • Judgment of 19 September 2019 (2C_1066/2017): Direct federal tax and cantonal tax 2013 (Ticino); tax domicile; on the basis of the available evidence, the lower court rightly concluded that the taxpayers were tax resident in Switzerland.
  • Judgment of 20 September 2019 (2C_323/2019): Value added tax (VAT). Several municipalities in the canton of Valais have joined forces for the joint maintenance of their forest areas. The "Triage forestier" thus created provides its services to this community. The relationship between the "triage forestier" and the municipalities constitutes a supply for consideration in terms of VAT. The fact that the municipality receives a subsidy for this task, which it has delegated to a third party, does not alter the fact that there is a supply relationship within the meaning of Article 18(1) of the VAT Act between the municipality and this third party. Approval of the appeal by the FTA.
  • Judgment of 19 September 2019 (2C_96/2019): Direct Federal Tax and State and Municipal Taxes 2015 (Zurich); it was questionable whether the complainants had been able to provide proof of incorrect assessment at their dutiful discretion with regard to maintenance contributions. This is only possible in case of obvious incorrectness. In summary, the lower court examined the assessment in detail according to its dutiful discretion and rightly did not find any obvious incorrectness with regard to the maintenance contributions allowed for deduction. Dismissal of the appellants' appeal.
  • Judgment of 24 September 2019 (2C_950/2018): Customs clearance; technical ethyl acetate; in the present case, the appellant is an undertaking engaged in international transport and freight forwarding and has specialised staff for carrying out customs procedures. It was therefore aware of the importance of the electronic customs declaration, which is why a rectification certificate submitted late cannot be taken into account; dismissal of the complaint lodged by the taxable person.
  • Judgment of 9 September 2019 (2C_515/2019): Customs; additional levy; the lower court carefully examined the discretionary estimate made with detailed reasons in order to arrive at differentiated and specific individual results horse by horse; the assessment of the lower court can be confirmed without further ado; dismissal of the appeal of the party liable to pay the levy.
  • Judgment of 16 September 2019 (2C_707/2018): Direct federal tax and state and local taxes in 2016 (Solothurn). In the present case, the actual separation of the complainant from his wife from the point of view of tax law exists on the day on which he moves out of the marital home, which is why maintenance payments are only deductible from that day. Rejection of the taxpayer's complaint.
  • Judgment of 16 September 2019 (2C_611/2018): Direct federal tax and state and local taxes in 2015 and 2016 (Solothurn). The use of the simplified accounting procedure (VAV) by the GmbH is not an abuse of law in the present case, since the wages of all personnel are accounted for in the VAV. There is no room for retroactive validity of the amended legal provision. Approval and rejection of the complaint to the assessment authority.
  • Ruling of 17 September 2019 (2C_803/2018): Direct federal tax and state and municipal taxes 2013 and 2014 (Solothurn). Question of whether income from employment was rightly settled in the simplified settlement procedure pursuant to Art. 37a DBG in conjunction with Art. Art. 2 of the Federal Tax Act and whether the complainants have thereby discharged their tax obligations. In the present case, the complainants are shareholders of a holding company which holds four public limited companies. According to the findings of the lower court, the application of the simplified settlement procedure resulted in a significant tax saving compared to the tax burden that the complainants would have been subject to if they had been subject to full ordinary taxation of their income (federal, cantonal and communal tax amounts 2013: CHF 13,278 instead of CHF 32,335; 2014: CHF 10,356 instead of CHF 31,855). The lower court assumes that the complainants did not determine the wages according to the work performed for the individual companies, but with regard to the thresholds of Art. 2 para. 1 lit. a and b BGSA. However, even if the salaries had actually corresponded to the work performed, it would have been more appropriate to the economic circumstances and would have entailed less administrative effort if the complainants had not been employed by all five companies, but only by one company. It must therefore be assumed that the arrangement was primarily motivated by tax savings. Not least against the background of the purpose pursued with Art. 37a para. 1 DBG and Art. 11 para. 4 StHG, the arrangement chosen by the complainants appears to be a circumvention of the provisions on the ordinary taxation of income from employment (E. 5.4.2). Dismissal of the complainants' appeal.
  • Judgment of 19 September 2019 (2C_1107/2018): Direct federal tax and state and local taxes 2015 (St. Gallen). The cantonal tax office rightly offset a provision set up by the taxpayer, which related to interest rate swaps, as there is no indication that the interest rate swap would have been threatened with termination as of the balance sheet date. Rejection of the taxpayers' complaint.
  • Judgment of 26 September 2019 (2C_351/2019): Direct federal tax and cantonal and communal tax 2007 (Geneva); no violation of Art. 162 Par. 3 DBG, because the wife who was separated after the tax period was not refunded the overpaid amounts; in the case of cantonal and municipal taxes, half of the refund is provided for under cantonal law; rejection of the complaint regarding direct federal tax or approval of the taxpayers' complaint regarding cantonal and municipal tax.
  • Judgment of 26 September 2019 (2C_281/2019): Direct federal tax and cantonal and communal tax 2008 - 2010 (Valais); anticipation of profits for shareholders of a company. The amounts evaded over the tax periods 2008 to 2010 were "subsequently declared" in the tax period 2011 following a VAT control which had prompted a report to the cantonal tax office. The cantonal tax administration has nevertheless imposed a fine in the amount of the evaded tax, which is in line with federal law. Due to the periodicity principle, such a subsequent declaration in a later tax period is not sufficient to argue that a tax loss has not occurred. Dismissal of the appellant's (company) appeal.

Non-occurrence decisions / inadmissible complaints:

  • Judgement of 20 September 2019 (2C_564/2018): Direct federal tax and cantonal tax 2008 - 2012 (Ticino); revision; intercantonal double taxation; the appeal will not be upheld due to the lack of specific objections to the decision of the canton making the first assessment. This is not changed by the fact that substantiated criticism of the decision of the canton making the second investment was brought forward: The appeal procedure in the first canton of assessment is not intended to criticise the assessment made later in the second canton, which could have been reviewed in the course of an ordinary appeal procedure; the appeal will not be upheld.

Decisions are listed chronologically by publication date.

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