Overview of the tax rulings of the Swiss Federal Supreme Court published between January 20 - 26, 2025:
- Judgment of December 11, 2024 (9C_120/2024): Direct federal tax and state and municipal taxes 2019 (Appenzell Innerrhoden); A AG applied for a participation deduction on the capital gain from the sale of units in a foreign open-ended collective investment scheme. The Federal Supreme Court confirmed the tax transparency of this collective investment scheme and emphasized that the doctrine - in contrast to the FTA - does not generally exclude the participation deduction in such cases. According to the doctrine, however, the collective investment scheme must have generated the distribution or the proceeds from the sale from participations that in turn fulfill the requirements for the participation deduction. However, as the taxpayer was unable to prove that it indirectly sold a significant participation within the meaning of Art. 70 para. 4 lit. b DBG by selling its units in the collective investment scheme, there is no need for an in-depth examination of the doctrine. Dismissal of the appeal by A AG.
- Judgment of December 16, 2024 (9C_268/2024): State and municipal taxes 2019 and 2020 (Zurich); additional tax; the testator had concluded an inheritance sharing agreement in the estate of her predeceased father, in which a credit balance was agreed in her favor vis-à-vis her father's surviving partner, as he was unable to pay her out. The credit balance was secured by mortgage and became due at the time of the life partner's death or the prior sale of his property. The accrual of assets had already taken place at the time of the death of the testator's father. The granting of a loan to the life partner did not result in a transfer of assets. The subsequent taxation of the deceased's assets was therefore correct. Dismissal of the taxpayer's appeal.
- Judgment of December 19, 2024 (9C_299/2024): VAT 2014 to 2015; at issue was the tax exemption of ground handling services and the question of whether the mineral oil tax exemption is considered a subsidy. The Federal Supreme Court ruled that the handling of passengers is part of the direct needs of an aircraft and is therefore tax-exempt. This includes check-in, information on flight schedules, baggage handling and security checks. Services such as the Special Assistance Passenger Service, on the other hand, are not tax-exempt as they are not directly necessary for boarding the flight. When selling flight tickets including additional services, the taxable person's activity does not meet the requirements of tax-exempt brokerage, as they are not acting "expressly on behalf of another person". The mineral oil tax exemption does not constitute a subsidy, as aircraft fuels are not taxed due to the provisions of the State Treaty (Chicago Convention and Doc 8632). Partial approval of the taxpayer's appeal.
- Judgment of December 20, 2024 (9C_57/2024): Direct federal tax 2018; the dispute was whether the profit from the sale of a property in the canton of Zurich should be qualified as a private capital gain or as income from self-employment. The lower court attached decisive importance to the connection between A. and C. GmbH. A. founded the company, is a sole signatory and received invoices for his personal account. The purpose of the company was the management and letting of the properties he had acquired. In his tax declarations, A. stated the profession "property manager" in the years 2004-2005 and "managing director of C. GmbH" in the years 2009-2011. His livelihood was mainly financed by rental income and the profit from the sale of the property was immediately reinvested. Over a period of 24 years, A. acquired eight properties that he did not live in himself, mainly apartment buildings. Under these circumstances, a sale already constitutes commercial real estate trading. A systematic or planned approach, a close connection with the taxpayer's professional activity and special expertise are all indications of self-employment. A. was unable to put forward any valid arguments against this. Dismissal of the appeal by taxpayer A.
- Judgment of December 11, 2024 (9C_454/2023): Direct federal tax and state and municipal taxes 2015 (Zurich); delimitation of private and business assets; as an independent lawyer, the complainant held shares in various companies and was a member of the board of directors of these companies. In the disputed tax period, the taxpayer sold one of these participations and realized a capital gain. The tax authorities assigned the participation to the lawyer's activity, qualified it as business assets and levied income tax on the capital gain. The Federal Supreme Court, on the other hand, came to the conclusion that the technical and economic function of the participation sold in this case did not allow it to be attributed to the lawyer's activity and that there was no independent secondary activity that would allow the participation to be classified as business assets. The Federal Supreme Court therefore classified the shareholding as private assets. The taxpayer's appeal was upheld.
- Judgment of December 20, 2024 (9C_218/2024): Direct federal tax and state and municipal taxes 2014 (St. Gallen); in the tax period in question, the taxpayer held shares in various public limited companies and was the (usually only) member of the board of directors. At the same time, he granted the companies domicile in his private property. The tax authorities attributed income from self-employment to the taxpayer to the extent of the payments for rental and heating costs and board activities that had been booked by the companies in favor of the taxpayer but not yet paid. With the booking, the acquisition process of the receivables was completed and these were realized as income from self-employment for tax purposes in accordance with the debit principle. The taxpayer was unable to prove that the receivables were irrecoverable. He was also unable to demonstrate a legally protected interest in maintaining taxation that did not comply with the law (actual method). Dismissal of the appeal by the taxable spouses.
- Judgment of January 6, 2025 (9C_342/2024): Direct federal tax and state and municipal taxes 2014-2017 (Valais); attempted tax evasion; A. operated a law firm and notary's office in the legal form of a sole proprietorship. During an audit, the tax authorities found that the accounts were incomplete and made a discretionary assessment. The rulings became final and unchallenged. Fines were imposed for attempted tax evasion, which were partially reduced by the Cantonal Court of Valais. The Federal Supreme Court found that the lower court had not violated either the ban on self-incrimination or the principle of "in dubio pro reo". The fact that the tax debts were paid retrospectively does not change the facts of attempted tax evasion. A further reduction of the fines was rejected. Dismissal of the appeal by taxpayer A.
Non-occurrence:
Decisions are listed chronologically by publication date.
