Contributed by: Inter-Tax Consultants, Zurich

You should benefit from setting up (or buying) your own Swiss Company until the end of year 2019 if you can!

Why? It makes a lot of sense to book 2019 corporate profits in Switzerland. Your business can still benefit from the Special tax status, and  internationally unmatched, low single-digit taxation while having fully tax compliant status at the same time (we can show you how). The Company with your happily low-taxed profits will be transferred seamlessly into the new 2020 regime, which was accepted by Swiss voters on the National Referendum.

It is true, that he new regime will reduce general corporate tax rates in Switzerland from 1.1.2020 and replace the Special tax status companies with tax deduction measures. This is good news. What is not mentioned, is it will not be completely effortless anymore to use all of the tax savings under the new regime. Your business will need to be more active and will need to plan the business on longer term to benefit from all of the tax savings offered.

The Tax deductions from 2020 on will continue to be offered by Cantons separately and will be different from the old tax regimes, say new European style. Tax deductions will vary, based on internal competition between Cantons in Switzerland which is good for your future business. For active companies, the tax deductions will be generally focused on the definition of R&D and in some cases on notional interest deduction. For Holding companies, the transition brings (in some arrangements) a quiet continuation of the same (nobody noticed) and in other cases a gradual step-up exercise for the accumulated off-balance sheet positions (cases with vintage untaxed profits).

If you want to benefit from this opportunity, call Inter-Tax Consultants for a free consultation.

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