Decisions of the Swiss Federal Administrative Court (CW 33/34 - 2020 )

Overview of the tax law decisions of the Swiss Federal Administrative Court published in the weeks of 10 - 23 August 2020.

Judgement of 24 July 2020 (A-6223/2019): Services to closely related persons; the disputed issue is (i) the offset taxable remuneration for making the infrastructure available to the related AG, (ii) the offsets relating to private shares in vehicles, (iii) any sale of a vehicle, (iv) a claimed input tax deduction in connection with an invoice from the related AG. The discretionary estimate carried out by the FTA proves to have been prepared in accordance with its duties. The appellant was not able to provide evidence to the contrary (i). The offsetting of the private share must be confirmed; here too, nothing to the contrary could be proven (ii). A sale, on the other hand, is not to be assumed, since a formal change of ownership does not indicate a transfer of ownership (iii). Since the invoice relating to the input tax deductions is not specific, the question of the actual receipt of the alleged supply cannot be proven. The deduction of input tax must be refused (iv). Partial acceptance of the complaint and rejection to the previous instance for further clarification.
Judgment of 5 August 2020 (A-2905/2020): Decision to reject / import works of art; examination of a consignment agreement that was unlawfully not examined due to the statute of limitations in the case concerning the unlawful application of the transfer procedure; import tax would have been due in this respect as well; dismissal of the complaint (see also our contribution of 12 July 2020); the complaint is partially upheld.
Judgment of 29 July 2020 (A-6511/2020): AMWST; limitation period (2011 - 2013); The real estate company A. AG has been invoicing on the basis of fees received since 1998. In early summer 2015, the FTA carried out a VAT control for the years 2011 to 2013. In an assessment decision dated 30 March 2017, the FTA set the amount of the additional claims. Under Art. 42 para. 1 VAT Act, the right to set a tax claim expires five years after the end of the calendar year in which it arose ("relative limitation period"). The limitation period may be interrupted. If the limitation period is interrupted by the taxpayer, the relative period of limitation is again five years from the date of interruption. If, on the other hand, the limitation period is interrupted by the FTA or a court of appeal, the period which begins anew is two years. The VAT claim arose in 2011. Thus, the relative limitation period has come into effect, as the assessment decision of 30 March 2017 was made afterwards. With regard to the VAT years 2012 and 2013, however, the interruption of the limitation period occurred within the five-year limitation period. Partial acceptance of the appeal.
Judgment of 29 July 2020 (A-6527/2020): VAT; limitation period (2011 - 2013); The real estate company A. AG has invoiced on the basis of the fees received since 2004. In early summer 2015, the FTA carried out a VAT control for the years 2011 to 2013. In an assessment decision dated 17 March 2017, the FTA set the amount of the additional claims. Under Art. 42 para. 1 VAT Act, the right to set a tax claim expires five years after the end of the calendar year in which it arose ("relative limitation period"). The limitation period may be interrupted. If the limitation period is interrupted by the taxpayer, the relative period of limitation is again five years from the date of interruption. If, on the other hand, the limitation period is interrupted by the FTA or a court of appeal, the period which begins anew is two years. The VAT claim arose in 2011. Thus, the relative limitation period has come into effect, as the assessment decision of 17 March 2017 was made afterwards. With regard to the VAT years 2012 and 2013, however, the interruption of the limitation period occurred within the five-year limitation period. Partial acceptance of the appeal.
Judgment of 29 July 2020 (A-6521/2020): VAT; limitation period; discretionary assessment (2012); Gastronomiebetrieb A. AG has been entered in the VAT register since 2009 and settles accounts according to the fee received. In early summer 2015, the FTA carried out a VAT inspection for the years 2011 to 2012. With its assessment decision of 3 April 2017, the FTA set the amount of the additional claims. The appeal against the decision was partially upheld by the FTA and it was established that the relative limitation period for the 2011 tax period had already occurred. With regard to the discretionary assessment, the objection was largely rejected. The obligations of the person liable for VAT include, in particular, proper accounting. The person liable for VAT must keep his books and records in accordance with the principles of commercial law (Art. 70 para. 1 MWSTG). If the business books do not comply with these principles, the FTA is obliged to make a discretionary assessment. Since the requirements for a discretionary assessment were fulfilled in the present case and the assessment could not be refuted, the appeal must be dismissed.
Judgment of 9 June 2020 (A-1480/2019): StG; turnover tax; In order for the turnover tax to be due, the following elements must be fulfilled: transfer of ownership, payment of remuneration, transfer of taxable documents and the participation of a domestic securities dealer, either as a contracting party or as an intermediary. In the present case, the Federal Administrative Court had to examine whether the complainant - who undisputedly qualified as a securities dealer within the meaning of the StG - was or was not considered an intermediary within the meaning of the StG in the context of a qualifying transaction between group companies. After a thorough examination of the specific circumstances of the present case, the Federal Administrative Court concluded that the turnover tax paid subject to reservation was rightly paid. Dismissal of the appeal (see also our contribution of 28 June 2020).
Judgement of 3 August 2020 (A-2164/2019): The subsequent levying of withholding tax on the basis of a payment in kind is lawful (whereby this was done at the recipient's premises - the bankruptcy proceedings concerning the company providing the service had already been discontinued due to a lack of assets); among other things, the SNB examines the statute of limitations of the withholding tax claim; annual financial statements were not submitted and no payments in kind were declared. It is therefore to be assumed that the seven-year limitation period under VStrR begins to run six months and 30 days after the end of the relevant business year; dismissal of the appeal.
Judgment of 3 August 2020 (A-2165/2019): withholding tax; similar situation to the judgment of 3 August 2020 (A-2164/2019), for which reason reference is made to the summary there.
Judgment of 3 August 2020 (A-2153/2019): withholding tax; similar situation to the judgment of 3 August 2020 (A-2164/2019), therefore reference is made to the summary there.

Decisions in the field of administrative assistance:

Judgement of 28 July 2020 (A-5146/2018): Administrative assistance - Double Taxation Convention Switzerland - Finland (DTA CH-FI); the appeal is dismissed; decision appealed to the Federal Supreme Court ‍
Judgement of 23 May 2019 (A-1275/2018): Administrative assistance double taxation agreement Switzerland - South Korea (DTA CH-KR); the appeal is dismissed; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 17 September 2019 (A-1315/2019): Administrative assistance Double Taxation Treaty Switzerland - USA (DTA CH-USA); the appeal is partially upheld; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 3 March 2020 (A-1348/2019): Administrative assistance double taxation agreement Switzerland - USA (DTA CH-USA); the appeal is partially upheld; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 21 April 2020 (A-4069/2019): Administrative assistance double taxation agreement Switzerland - USA (aDBA CH-USA); the appeal is partially upheld; decision confirmed by the Federal Supreme Court (see our article of 9 August 2020).
Judgement of 22 July 2019 (A-4588/2018): Administrative assistance double taxation agreement Switzerland - Sweden (DTA CH-SE); the appeal is partially upheld; decision partially confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 22 May 2019 (A-5047/2018): Administrative assistance double taxation agreement Switzerland - USA (DTA CH-USA 96); the appeal is partially upheld; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 22 May 2019 (A-5048/2018): Administrative assistance double taxation agreement Switzerland - USA (DTA CH-USA 96); the appeal is partially upheld; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 22 May 2019 (A-5082/2018): Administrative assistance double taxation agreement Switzerland - USA (DTA CH-USA 96); the appeal is partially upheld; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020).
Judgement of 5 March 2019 (A-2117/2018): Administrative assistance - Double Taxation Convention Switzerland - Spain (DTA CH-ES); the appeal will not be entertained, as the final ruling is null and void; decision partially confirmed by the Federal Supreme Court (see our contribution of 9 August 2020)
Judgement of 5 March 2019 (A-2138/2018): Administrative assistance - Double Taxation Convention Switzerland - Spain (DTA CH-ES); the appeal will not be entertained, as the final ruling is null and void; decision confirmed by the Federal Supreme Court (see our contribution of 9 August 2020)
Judgment of 12 April 2019 (A-630/2019): Administrative assistance double taxation agreement Switzerland - France (DTA CH-FR); party status; the appeal is dismissed; decision confirmed by the Federal Supreme Court.
Judgement of 29 January 2018 (A-525/2017): Administrative assistance double taxation agreement Switzerland - India (DTA CH-IN); party status; the appeal is partially upheld; decision partially confirmed by the Federal Supreme Court.
Judgement of 8 April 2019 (A-6871/2018): Administrative assistance - Double Taxation Convention Switzerland - Spain (DTA CH-ES); the appeal will not be entertained, as the final ruling is null and void; decision reversed by the Federal Supreme Court (see our contribution of 9 August 2020)
Judgement of 7 July 2020 (A-768/2020): Administrative assistance double taxation agreement Switzerland - India (DTA CH-IN); the appeal is dismissed, insofar as it can be upheld; the Federal Supreme Court has written off the case on the grounds that it is irrelevant.
Judgment of 3 August 2020 (A-1534/2018): Administrative assistance in connection with the double taxation agreement between Switzerland and France (DTA CH-FR); the appellants' request for suspension is dismissed for lack of merit; the appeal is dismissed.
Judgment of 3 August 2020 (A-1555/2018): Administrative assistance in connection with the double taxation agreement between Switzerland and France (DTA CH-FR); the appellants' request for suspension is dismissed for lack of merit; the appeal is dismissed.
Judgment of 3 August 2020 (A-1562/2018): Administrative assistance in connection with the double taxation agreement between Switzerland and France (DTA CH-FR); the appellants' request for suspension is dismissed for lack of merit; the appeal is dismissed.
Judgment of 3 August 2020 (A-1563/2018): Administrative assistance in connection with the double taxation agreement between Switzerland and France (DTA CH-FR); the appellants' request for suspension is dismissed for lack of merit; the appeal is dismissed.