Overview of the tax rulings of the Swiss Federal Supreme Court published in the week of October 8 - 14, 2018.

  • Judgment of 11 September 2018 (2C_1020/2017): Direct federal tax and state and municipal taxes 2014 (Zug); maintenance and administration costs; in the case of a property rented by a company in its business acquisition area and left within the same economic sphere (in the sense of a secondary wage agreement) to a member of management (and his family), it is justified to speak of a predominantly business use by third parties, as this term is used in accordance with the law, with Art. 4 of the Real Estate Costs Ordinance and with the applicable case law; this does not change the fact that the use by the member of management and his family served private purposes without any gainful employment being carried out in the house or garden; according to case law, only the actual property maintenance costs can be deducted for properties in private assets which are let to third parties for business use; the flat-rate deduction is not permitted; the complainant's appeal is dismissed insofar as it is to be upheld.
  • Judgment of 28 August 2018 (2C_1092/2017): Art. 4 of the Ordinance of the Canton of Fribourg on the registration fee for students and students of the University of Fribourg of 7 November 2017 (abstract control of norms). On 28 December 2017, the academic staff of the Faculty of Law of the University of Fribourg lodged an appeal in a public-law matter with a motion to repeal Art. 4 of the Ordinance, which now provides for an enrolment fee of CHF 180 per semester for doctoral candidates. In this context, the complainants complained of a violation of the principle of legality in tax law (Article 127(1) of the Federal Constitution), a violation of equality of rights (Article 8(1) of the Federal Constitution) and a violation of Article 13(2)(c) of the UN Covenant I, which provides that university education is to be made accessible, in particular through the gradual introduction of free education. Since both the object of the levy and the subject of the levy are sufficiently defined, and since it can be assumed that the university's expenditure on supervising doctoral students has recently approached or even partly exceeded that for students, there can be no objection under the legality principle to at least partially aligning doctoral students with undergraduate students in terms of fees (E. 3.7.3). Nor can the alleged unequal treatment between doctoral and post-doctoral students be substantiated (E. 4.5). Moreover, it is not easy to see why a doctoral programme, unlike other continuing education programmes, should necessarily be free of charge, especially since it is an additional qualification after graduation (E. 5.5). Dismissal of the appeal of the taxable persons.
  • Judgment of 17 September 2018 (2C_267/2018): Direct federal tax and cantonal and communal taxes 2010 and 2011 (Valais); the subsequent taxation of a compensation payment not declared by the taxpayer proves to be legally compliant. The appellants confine themselves to opposing the judgment under appeal with their own view of the facts and evidence, which is not sufficient to make the facts and evidence assessed at the lower instance appear to be manifestly incorrect, as would be necessary in the light of Article 105(2) of the FSCA. Rejection of the taxpayers' complaint.
  • Judgment of 17 September 2018 (2C_813/2017): Direct federal tax and cantonal and municipal taxes 2001-2004 (Geneva); hidden profit distribution through the provision of an apartment to the individual shareholder of a public limited company. Since the corresponding tax period (2001) was already the subject of an assessment, the statute of limitations is not based on Art. 120 DBG (statute of limitations on assessment), but on Art. 152 DBG (forfeiture of the right to initiate post-tax proceedings) (E. 5.4.2). On the basis of Art. 205f DBG, according to which the new law is applicable for the assessment of offences committed in tax periods prior to the entry into force of the amendment of 26 September 2014, if it is milder than the law applicable in those tax periods, the prosecution is statute-barred (E. 6.1.). Partial acceptance of the appellant's complaint.
  • Judgment of 20 September 2018 (2C_418/2018): Real estate gains tax (Neuchâtel); according to Art. 12 para. 3 lit. e StHG, the taxation of real estate gains on the sale of a residential property (single-family house or condominium) used permanently and exclusively for own use is deferred, provided that the proceeds from the sale are used within a reasonable period of time to acquire or construct an equivalent replacement property in Switzerland. Leaving the original domicile before the apartment is sold is not detrimental to the applicability of the provision. However, the deferment does not apply if the domicile is abandoned and the dwelling is not immediately offered for sale, but is used for other purposes (storage, retirement property, etc.). Dismissal of the appellant's appeal.
  • Judgment of 24 September 2018 (2C_129/2018): Direct federal tax and cantonal and communal taxes 2005-2013 (Geneva); discretionary assessment of a taxpayer who has moved abroad and thus had only limited tax liability in Switzerland. Post-tax proceedings due to subsequently discovered property income (from subletting agreement). This also constitutes intentional tax evasion.

Non-occurrence decisions / inadmissible complaints:

Decisions are listed chronologically by publication date.

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