Overview of the tax law decisions of the Swiss Federal Supreme Court published in the week of 11 - 17 January 2021.

  • Judgment of 9 October 2020 (2C_298/2020): Direct federal tax and state and municipal taxes 2013 (Thurgau); Attempted tax evasion; A AG was offset against various expenses and write-offs for lack of business justification. In the present case, the objective and subjective facts of attempted tax evasion are fulfilled. Moreover, findings from the assessment proceedings can be used in the tax evasion proceedings. Dismissal of the taxpayer's appeal.
  • Ruling of 27 November 2020 (2C_536/2020): Direct federal tax and state and municipal taxes 2014 (Zurich); The taxpayer A. AG has provided capital to D. since 2000; A. AG participated in the context of a capital increase in D. with 88.16%. The shares were paid off by converting a claim against D. What is disputed in the present case is the depreciation which A. AG made on this participation. The booking of a "nonvaleur" is contrary to commercial law. Without the conversion of the claim, D. would have been over-indebted. Under these circumstances, it appears that the economic value of the contributed claim was below its nominal value or no longer recoverable and that the payment constituted a restructuring measure. However, the correct value is unclear and the lower court should have determined it. Dismissal of the taxpayer's appeal and referral back to the lower court.
  • Judgment of 02 December 2020 (2C_249/2020): Pauschale Steueranrechnung, Fälligkeiten 2012 (Zug); In dispute here is the lump-sum tax credit on dividend income from a qualified participation. Pursuant to Art. 5 para. 4 PStAV, income that is only subject to partial taxation is deemed not to be taxed, which, according to case law, is in irreconcilable contradiction to Art. 24 para. 2 no. 2 DBA CH-DE . The provision is to be interpreted in such a way that a different extent of privileged treatment of qualified investment income at the federal and cantonal/communal levels is taken into account by determining the maximum amount separately and then adding it together. This is contrary to the opinion of the FTA, which considered the application of the third solution according to Art. 12 PStAV to be correct. Dismissal of the FTA's appeal.
  • Judgment of 3. December 2020 (2C_613/2020): Direct Federal Tax and State and Municipal Taxes 2013 (Valais); The taxpayer husband was a member of community of heirs 1, which owned a plot of land with a restaurant together with community of heirs 2 (co-ownership); The taxpayer husband decided to continue running the restaurant on his own; For this purpose, he acquired the co-ownership share of community of heirs 2; before the share of community of heirs 1 was allocated to him by means of an inheritance distribution agreement and he became the sole owner of the plot and the restaurant, he leased this share; at the end of 2013, he sold the restaurant to a third party and terminated his self-employed activity; The question to be clarified was whether the entire liquidation gain attributable to the co-ownership share of community of heirs 1 is taxable for the taxpayers (married couple); Upon the death of the deceased, the heirs of community of heirs 1 took his place and became self-employed; This also applies if they do not continue the business themselves, but sell, liquidate or lease it; The allocation of the co-ownership share 1 together with the business to the taxpaying husband by way of inheritance constitutes an act of realization within the meaning of DBG 18 para.The taxpayers did not apply for a tax deferral, which is why the liquidation gain realised by the departing heirs was taxable for them at the time of the separation; The liquidation gain of the taxpayers is limited to the hidden reserves to the extent of the taxpayer husband's share of the inheritance for the period prior to the division of the inheritance; Only after the division of the inheritance is the liquidation gain exclusively taxable for the taxpayers; The taxpayers' appeal is upheld.
  • Judgment of 28 December 2020 (2F_31/2020): Direct Federal Tax and State and Municipal Taxes 2016 (Geneva); The appeal in respect of judgment 2C_380/2020 is dismissed.
  • Judgment of 28 December 2020 (2F_32/2020): Direct Federal Tax and State and Municipal Taxes 2015 (Geneva); The request for revision regarding judgment 2C_935/2020 is approved.
  • Judgment of 22 December 2020 (2F_33/2020): direct federal tax and state and municipal taxes 2012-2016 (Geneva); dismissal of the request for restoration of time limits.
  • Judgment of 28 December 2020 (2C_899/2020): Inheritance tax (Valais); In the present case, no tax exemption on the basis of a charitable purpose for foreign legal entities (in casu an Italian association), as the cantonal interpretation of the law is neither contrary to legal uniformity nor arbitrary; Dismissal of the appeal of the association and executor of the will.

Non-entry decisions / administrative assistance:

Decisions are listed chronologically by publication date.

Tax topics covered in this post:
Income Tax