Overview of the tax law decisions of the Swiss Federal Supreme Court published in the week of 1 - 7 February 2021.
- Judgment of 19 January 2021 (2C_148/2020): Direct Federal Tax and State and Municipal Taxes 2011 (Geneva); The plaintiff's husband died in an attack on a Lebanese politician. Distinction between taxable income and gift in relation to a benefit provided by a legal entity to an individual (not a shareholder). According to the case law, a commercial company cannot, in principle, make a gift because it acts only from economic motives. Whether this was different in the present case did not have to be examined, as the benefit in question was due to the fulfilment of an obligation under Lebanese customary law. Such performances also exclude the intention to make a gift (animus donandi). Thus, the thesis of the complainant was rejected, according to which the benefit in question had been - in the sense of a triangle - a pecuniary benefit to the shareholders of the company and then a gift to the complainant. Dismissal of the taxpayer's appeal.
- Judgment of 19 January 2021 (2C_459/2020): Real estate gains tax (Vaud); In the context of an inheritance, A., his brother and the mother acquired the shares of the real estate company, whereby taxation was deferred due to the inheritance. In 2002, A. and his brother purchased two plots of land from the real estate company. The issues in the present dispute are when the property sold was purchased in 2012 and at what price, and whether tax deferral applies when the properties were purchased in 2002. The purchase of the properties was notarized on February 26, 2002, and was acquired out of a situation that resulted in tax deferral. The purchase of 26 February 2002 is therefore not also subject to tax deferral, as it is not related to the inheritance. The purchase price was determined by the cantonal authorities by means of the market value of the property divided by the corresponding number of shares. Such a procedure is not objectionable. Dismissal of the taxpayer's appeal.
- Judgment of 19 January 2021 (2C_811/2020): Geneva business tax (taxe professionnelle) 2018 and 2019; Only the complete change of purpose falls under cantonal legislation. In particular, the lower court's interpretation that only a fundamental change is to be understood by this and that this did not occur in the case of the taxpayer is not arbitrary. The mere abandonment of certain activities does not lead to a complete change of purpose, as the taxpayer's main activity was still financial advice and services. The taxpayer's appeal was dismissed.
- Ruling of 28 December 2020 (2C_186/2020): Direct Federal Tax and State and Municipal Taxes 2014 (Zurich); Medical facilities under the KVG are considered to be a health care facility. The Federal Supreme Court examined whether a purely inpatient hospital stay with a subsequent, continuing outpatient (control) treatment also falls under the special purpose. In the present case, the limited taxpayer stayed in his condominium in the Canton of Zurich from January to October, interrupted by two inpatient hospital treatments. Since the 90 days (excl. hospital stay) were exceeded in total, the patient established a qualified stay under tax law. Contrary to the lower court, the unlimited tax liability ended with the return trip to the Bahamas. The visit of the sick father in December did not result in a full year of tax residency. Partial allowance of the taxpayer's appeal.
- Judgment of 19 January 2021 (2C_232/2020): Administrative assistance DTA (CH-FR). In the present case, the taxpayer A. declared his residence in Angola. However, ongoing investigations established that he resided in France. Despite the conclusion of the internal proceedings in France concerning the 2012-2013 tax periods, the information requested in relation to bank accounts at a Swiss bank is likely to remain significant. The criterion of probable relevance may disappear in the course of the proceedings. However, internal procedural actions - in this case, discontinuation of the proceedings instead of suspension - cannot be used as a basis for drawing conclusions with regard to probable relevance as long as the request for administrative assistance itself is not withdrawn. In particular, the fact that the internal proceedings were only suspended in relation to the 2013-2014 tax periods is therefore irrelevant. The result of the request for administrative assistance may well cause the proceedings to be reopened, depending on the circumstances. Appeal of the FTA upheld.
- Judgment of 19 January 2021 (2C_196/2020): landowner contributions for the extension of a road; dismissal of the appeal.
- Judgment of 22 January 2021 (2C_668/2020): Direct Federal Tax 1999-2000 and State and Municipal Taxes 1998-2000 (Geneva); Art. 6 ECHR is not applicable to the assessment procedure (or post-tax procedure including interest on arrears). Neither Art. 29 para. 2 BV nor Art. 125 DBG grant a right to an oral hearing in the assessment proceedings. In the present case, the complainants, who are married, accuse the tax office of having done too little to prove their lack of solvency. According to the complainants, the tax authority should have apportioned their tax factors on the basis of Article 13 of the Federal Tax Act. However, the complainants fail to recognise that the procedural obligations of Art. 123 et seq. DBG are only aimed at an exact assessment. Proof of insolvency is only required after the assessment has become final. Dismissal of the complainants' appeal.
Non-entry decisions / administrative assistance:
- Judgment of 19 January 2021 (2C_56/2021): direct federal tax and state and municipal taxes 2018 (Geneva); dismissal.
- Judgment of 22 January 2021 (2C_53/2021): Administrative assistance (DTA CH-FR); Dismissed.
Decisions are listed chronologically by publication date.