Swiss purchase tax: What you need to know as a company
Purchase tax in Switzerland is a central part of the value added tax system. It primarily concerns companies that purchase services or certain supplies from abroad.
If it is declared incorrectly or not at all, there is a risk of additional taxes and interest on arrears. Anyone who understands the principle remains compliant and avoids unnecessary risks.
What is the purchase tax in Switzerland?
Purchase tax is a form of value added tax that is incurred when your company purchases services from a foreign provider who is not subject to VAT in Switzerland.
In this case, the so-called reverse charge principle applies. This means: It is not the foreign provider who collects the tax, but you, as the recipient of the service, must calculate it yourself and declare it in your VAT statement.
Typical examples of benefits subject to subscription tax include:
- Online marketing services from abroad
- Consulting services from international providers
- Software subscriptions or cloud services
- License fees and other digital services
Purchase tax is often overlooked, especially when it comes to digital services.
When does the purchase tax apply?
The purchase tax is due if the following conditions are met:
- The service is provided by a foreign company.
- The beneficiary is located in Switzerland.
- The foreign provider is not subject to VAT in Switzerland.
- In principle, the benefit would be taxable in Switzerland.
If your company is subject to VAT, you must declare the purchase tax in your periodic VAT statement.
How is the purchase tax calculated and declared?
The purchase tax is calculated on the basis of the invoice amount. As a rule, the applicable VAT rate applies, such as the standard rate.
The calculated amount will be:
- declared as due sales tax
- claimed as input tax at the same time, provided that you are entitled to deduct input tax
In many cases, this does not result in an effective tax burden. However, the declaration requirement remains in place.
This means: Even if there is no net payment, you must correctly enter and report the collection tax.
Common mistakes when it comes to Swiss subscription tax
In practice, the same errors occur over and over again:
- International services are not recognized, especially with SaaS tools or online platforms
- The purchase tax is not declared or is declared late
- It is mistakenly assumed that only goods are affected
- The documentation for VAT checks is incomplete
These errors are usually caused by a lack of structure in the crediting and accounting organization.
Implement collection tax correctly: practical tips
So that you manage the collection tax properly, you should:
- Clearly classify suppliers by country and abroad
- Mark digital services separately
- Set up VAT accounts correctly for collection tax
- Check foreign invoices regularly
- Standardize or automate accounting processes
The more structured your accounting, the lower the risk of errors.
Conclusion: Understanding purchase tax means avoiding risks
The purchase tax in Switzerland affects many companies, particularly in the digital environment. Even though it often does not trigger an effective additional burden, the correct declaration is essential.
Anyone who knows their international services, records them cleanly and regularly reviews them, stays on the safe side and avoids unnecessary corrections or sanctions.
