The Tax Administration of the Canton of Basel-Stadt has published its Tax Practice (BStP) September 2017 edition.
The tax administration of the canton of Basel-Stadt is devoting the following decisions in the published BStP issue September 2017:
- BStP 2017/9: Fictitious delivery, taxation of liability insurance benefit; a period of up to one year since the last procedural act of the authority is considered reasonable for the fictitious delivery. This is not applicable in casu, as more than 23 months have passed since the last procedural act was taken or more than 39 months since the objection was raised. In the case of direct federal tax, the procedure pursuant to Art. 108 DBG would have been applicable in the event of a conflict of jurisdiction, although in the present case such a procedure was waived for reasons of procedural economy. Insurance benefits from a private liability insurance are taxable at the time of the agreement, settlement or notification by the insurance company or, subsidiarily, at the time of payment. Lump-sum benefits from pension schemes as well as payments in the event of death and for permanent physical or health disadvantages are taxable in the canton in which the taxpayer is resident at the time the benefit is due. Judgment of the Federal Court of 26 April 2017(2C_298/2015, 2C_299/2015).
- BStP 2017/10: Under the DBA Switzerland - Germany, German withholding tax is generally credited on the gross amount, but under Swiss law it is limited to the net amount. Switzerland has not included any provision in its double taxation agreements that would provide for a complete elimination of double taxation. There is a sufficient delegation norm of legislative competence for the Ordinance on the Flat-Rate Tax Credit (PStAV) to the Federal Council. Judgment of the Federal Court of 22 May 2017(2C_573/2016, 2C_574/2016).
- BStP 2017/11: For inheritance and gift tax, a reduced tax rate applies to persons who, at the time the tax claim arises, have lived with the person making the allocation for at least five years in a joint household with the same tax residence. The question of whether the absence of registration in the population and tax registers is a prerequisite for the application of privileged taxation is not a matter of establishing the facts of the case but of interpreting and applying the law. By contrast, the question as to whether there was a common household or where the complainant's centre of life was located concerns the assessment of evidence. In casu, the assessment of the lower courts that a common budget has not been proven is not arbitrary. The requirement of a common budget for privileged taxation does not violate the prohibition of discrimination against homosexual persons. Federal Supreme Court judgment of 28 July 2017 (2C_489/2017).
- BStP 2017/12: In the case of alternative goods, i.e. those which are used both for business and private purposes, the allocation to business or private assets is to be made according to the predominant use in the corresponding area (so-called preponderance method). In casu, no evidence that the vehicle was used predominantly for business purposes, which means that the vehicle is to be allocated to private assets and a lump sum is to be granted instead of the declared vehicle expenditure. For self-employed persons, contributions to recognised forms of provision are to be regarded as costs of private living. The necessity of a private study as well as expenses for further training must be proven by the taxable person. Property expenses are deductible in the tax period in which they were paid. The prerequisite for a worse position is that the taxpayer is given the opportunity to comment in advance. Assessment orders are not assurances for future assessments, which is why the tax authorities can make a new assessment for each tax period. Decision of the Tax Appeal Commission Basel-Stadt of 20 October 2016 (STRK.2015.150).
The BStP issue September 2017 is available here.
