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VALUE TAX AND FISCAL DISTRIBUTION
VAT obligation for foreign companies
Foreign companies that have a total worldwide taxable annual turnover of CHF 100,000 or more become liable for VAT in Switzerland from the first franc of taxable turnover. They require a fiscal representation in Switzerland so that they can register with the Federal Tax Administration FTA as a VAT-liable company.
Calculate sales limit
For the determination of the sales limit, the fees earned from the following services are to be taken into account:
If a foreign company without a registered office in Switzerland is not entered in the commercial register, it must provide security when it is entered in the VAT register. It is customary for this to be provided as a cash payment or by means of a bank guarantee at a Swiss bank. As a rule, the amount of the security is 3% of the expected taxable domestic turnover.
Foreign companies that are not taxable in Switzerland and do not provide any services in Switzerland can reclaim the Swiss VAT charged to them in the so-called refund procedure, provided that the relevant requirements are met. In order to initiate this refund procedure, the company must appoint a representative established in Switzerland. The necessary application for refund must be made within six months of the end of the calendar year in which the taxed service was provided to the applicant.
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