Overview of the tax law decisions of the Swiss Federal Supreme Court published in the week from 25 to 31 March 2019.

  • Judgment of 11 March 2019 (2C_181/2019, 2C_182/2019, 2C_183/2019): Direct Federal Tax and State and Municipal Taxes 2008-2013 (Solothurn); in the proceedings to be judged in the present case, it was disputed whether a lawyer entered in the register of lawyers representing a taxable person is entitled, at the stage of the pending evasion proceedings before the assessment authority, to demand that the official files be sent to his office domicile In particular, it must be clarified whether the legal right to "inspection" of the files actually means only "inspection", or whether it includes delivery to the lawyer's office domicile. According to the Federal Supreme Court's case law, there is no absolute right to be served the files, but only within the framework of an existing practice, a right to equal treatment, as long as the respective circumstances are comparable (judgment 2C_201/2013 of 24 January 2014 E. 4.1, not published in: BGE 140 II 194, but in: ASA 83 175; judgment 9C_369/2012 of 2 November 2012 E. 6.3). According to the case-law, it is also compatible with the principle of equal treatment if the files are only handed over to lawyers entered in the register of lawyers, but not to private complainants (BGE 108 Ia 5 E. 3 pp. 8 f.; 123 II 534 E. 3d p. 541; judgments 8C_431/2014 of 17 October 2014 E. 3.2; 5A_349/2009 of 23 June 2009 E. 3.4; 1P.55/2007 of 15 March 2007 E. 2.5). However, this does not result in a constitutional right to the delivery of files to the lawyer. Nor can Article 8 para. 1 DPA (Federal Act of 19 June 1992 on Data Protection; SR 235.1), according to which any person may request information from the controller of a data file as to whether data concerning him or her is being processed, change this. As a rule, the information must be provided "in writing, in the form of a printout or a photocopy", but only insofar as the data are processed by a federal body (Art. 2 para. 1 letter b FADP). This was not fulfilled in the present case. Not only state and municipal taxes, but also direct federal taxes are assessed and received by the respective canton (Art. 128 para. 4 sentence 1 BV; Art. 2 DBG). Complaints by taxpayers are dismissed to the extent that they are justified.
  • Judgment of 11 March 2019 (2C_905/2017): Direct Federal Tax 2015; allocation of the child deduction in the year of majority of the child of parents who are taxed separately; from a tax system perspective, the parent entitled to maintenance is responsible for the maintenance of the child until the child reaches the age of majority, whereas after the child reaches the age of majority the parent providing maintenance is responsible; this change in the system justifies allocating the child deduction in the year of majority of the child of parents who are taxed separately to the two parents on a pro rata temporis basis; consequently, until the day the child comes of age, the alimony-receiving parent is entitled to the child deduction, whereas from that day onwards, the alimony-paying parent is entitled to the child deduction; admittedly, this only applies on condition that the alimony paid throughout the year exceeds the amount of CHF 6,500; the complainants' appeal is partially upheld.
  • Judgment of 11 March 2019 (2C_1142/2018): Direct Federal Tax and State and Municipal Taxes 2016 (Solothurn); it was disputed to what extent the complainant could claim deductible travel expenses after he had already received compensation of CHF 16,122 from his employer for the use of his vehicles; the tax authorities were correct in estimating the kilometres travelled on business and thus the total travel costs in the present case according to dutiful discretion, deducted the employer's compensation for expenses and allowed the remainder to be deducted; the lower court's determination of the deductible travel costs is not objectionable; dismissal of the complainant's appeal.
  • Judgment of 10 March 2019 (2C_1036/2017): State and communal taxes 2015 (Thurgau); tax domicile; the complainant (born in 1958), after winning one million Swiss francs in the lottery, moved his residence to the canton of Schwyz in 2015, where he rented a furnished room as a subtenant; the tax administration of the canton of Thurgau maintained the complainant's tax liability regarding state and communal taxes per 2015 the cantonal appeals lodged against this remained unsuccessful; by means of an appeal in matters of public law, the appellant seeks to have the Administrative Court's judgment set aside and to have it established that he was not a tax resident in the relevant Thurgau municipality or municipality for the tax period 2015. canton of Thurgau and that he is not taxable there, and, possibly, that the case be referred back to the Administrative Court for reassessment; since the present case involves tax liability on the basis of personal affiliation, harmonised in Article 3(3)(a) of the Law, the appellant seeks the annulment of the Administrative Court's judgment and the declaration that he is not taxable in the canton of Thurgau or in the canton of Thurgau. 1 and 2 StHG, the cantons have no room for manoeuvre and the Federal Supreme Court therefore examines the application of the relevant cantonal provisions with full cognition; the Federal Supreme Court states that the tax-law (residential) domicile as a tax-raising fact must in principle be proven by the tax authority; however, if the domicile or residence assumed by the tax authority is If, however, the seat or place of effective management assumed by the tax authority in the canton appears to be very likely, this is usually sufficient as primary evidence and it is up to the taxpayer to provide counter evidence for the seat outside the canton, i.e. the taxpayer must demonstrate that a transfer of domicile has taken place - this includes the final dissolution of the links with the previous domicile and the presentation of the circumstances that led to the establishment of the new domicile; if the taxpayer is unable to provide proof of the transfer of domicile, the previous domicile will continue to exist; the Federal Supreme Court concludes in casu that the appellant is not able to invalidate the considerations of the tax administration, in particular the earlier designation of his partner resident in the canton of Thurgau as a "permanent partner" and the mention of this in the death notice of the appellant's mother, who died in 2016; furthermore, the Federal Supreme Court considers with the lower court that it seems unusual for a lottery millionaire born in 1958 to be content with a room in a shared flat; in summary, the Federal Supreme Court finds that the appellant has not succeeded in showing that and why he has changed his centre of life; dismissal of the appellant's appeal
  • Judgment of 12 March 2019 (2C_447/2018): emissions levy; appeal against the decision of the Federal Administrative Court of 19 April 2018 (A-3554/2017); cf. on the BVGer decision our contribution of 6 March 2019 (2C_447/2018) It may be true that the exclusion of the subscription rights of the previous shareholders of the acquiring company in the event that the seller of the shares is the sole shareholder of the acquiring company, as in the present case, is ultimately of no material significance; this does not, however, alter the fact that a merger-like concentration requires a close link between the companies, for which in practice a capital increase is required; in the present case it is not apparent that a close link between the companies would have been established after the purchase of the shares; the contribution of the shares is therefore not a quasi-merger but a pure share purchase transaction; the contributions are therefore not exempt from the issue tax; dismissal of the appellant's complaint.
  • Judgment of 10 March 2019 (2C_473/2018), currently not available in electronic form Direct Federal Tax and State and Municipal Taxes 2010 (Zurich); DTA Switzerland-South Africa; the complainants (couple) were assessed jointly for the 2010 tax period, with the Cantonal Tax Office of Zurich (hereinafter Tax Office) assuming an unlimited tax liability for both of them; by means of a complaint in matters of public law, the complainants request that the tax liability be established on the basis of the economic tax liability of the husband complaining about for the 2010 tax period; in the opinion of the Federal Supreme Court, the complainants' complaint that the tax office had violated the right to be heard by failing to assess earlier assessments for the 2007 tax period is not convincing, especially since the tax office was not obliged to comment in detail on all the evidence submitted - especially if there was no direct connection between the evidence and the disputed legal issue; a person's domicile for tax purposes is deemed to be the place where the centre of his vital interests is actually located; this is determined on the basis of the totality of the objective, external circumstances from which these interests can be identified; in accordance with settled federal court practice, it is not sufficient for a transfer of domicile abroad to sever the links with the previous domicile; rather, the decisive factor is that a new domicile has been established on the basis of all the circumstances; the facts on which the determination of the tax domicile is based must be proven by the tax authorities as the basis for the tax; the taxpayer is obliged to cooperate and provide comprehensive information on the circumstances relevant for taxation; due to the fact that the complainant's complaints in connection with the facts on which the determination of tax domicile is based predominantly concern the legal assessment of these facts and that the complainants have not sufficiently dealt with a possible obviously incorrect determination of the facts at the preliminary instance, the Federal Supreme Court sees no reason to deviate from the determination of the facts at the preliminary instance; since it is undisputed that the complainant's wife is domiciled in the Canton of Zurich under both civil and tax law and, in the case of married persons with relations to several places, the personal and family contacts to the place where their family resides are generally considered to be stronger than those to the place of work, considerable personal contacts must be brought forward by the complainants starting from the wife's domicile, in the light of which the relationship of the complainant husband to his wife's domicile would take a back seat; the Federal Supreme Court considers that the husband's membership of a South African golf club, as well as the alleged personal contacts, as alleged by the complainants, are insufficient or The Federal Supreme Court considers that the husband's membership of a South African golf club and the alleged personal contacts have been insufficiently or insufficiently substantiated; likewise, with regard to personal interests, the acquisition of a full set of housing facilities in South Africa does not constitute convincing facts, but only circumstantial evidence; in connection with the professional activity to be assessed in view of the business focus of the husband's life interest and also in view of his mandate on the board of directors of a South African company in the 2010 tax period, the opinion of the lower court is that the business interests of the complainants lie in Switzerland, but that there are no such interests, particularly since the complainants' company is domiciled in Switzerland and the wife kept the company's financial accounts from Switzerland; in summary, the Federal Supreme Court with the lower instance concludes that the centre of the complainant husband's vital interests in the 2010 tax period is in Switzerland, especially as the business interests in South Africa, in an overall view, cannot outweigh the complainant husband's personal interests in Switzerland; dismissal of the complainants' appeal.

Non-occurrence decisions / inadmissible complaints:

Decisions are listed chronologically by publication date.

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