What is the Swiss VAT return?

Definition

The VAT return is the periodic tax declaration submitted by each VAT-registered business to the Federal Tax Administration (FTA). It is the central document in the relationship between the business and the federal tax authority with regard to VAT: it determines what the business must pay (or what the FTA reimburses) for the relevant period.

How it works

The VAT return is built in four steps:

1. Total the turnover by applicable rate (8.1%, 2.6%, 3.8%) — and identify turnover that is exempt or excluded from the scope of VAT.
2. Calculate the VAT collected (output tax) by applying the rates to the net amounts.
3. Total the input tax (VAT paid on professional purchases) if using the effective method.
4. Calculate the balance: VAT collected − input tax = amount payable to the FTA (or recoverable if the balance is negative).

The return is submitted online via the efin.estv.admin.ch portal and payment is due within the same deadline.

Methods of accounting

Effective method

The effective method is the standard approach. It requires precise recording of each VAT transaction. It entitles the business to full deduction of input tax and is generally more advantageous for businesses with significant professional purchases (equipment, subcontracting, etc.).

Net debt fiscal rate (NDFR)

The NDFR is a simplified method available to SMEs whose annual turnover does not exceed CHF 5,005,000 and whose net tax debt does not exceed CHF 103,000 per year. The FTA assigns a flat rate according to the sector of activity (for example, a rate of 6.1% for restaurants, a different rate for retail, etc.). The VAT due is obtained by multiplying total turnover (VAT included) by this flat rate — input tax is not deducted separately.

Swiss context

In Switzerland, the VAT return is quarterly for the majority of businesses. The submission and payment deadline is the 25th day of the month following the end of the quarter. The FTA also accepts requests for half-yearly returns from small businesses. Reimbursement of excess input tax normally takes place within 60 days of the return being filed, subject to a possible audit.

The legal basis is the Federal Act on Value Added Tax (FAVA), which entered into force on 1 January 2010, revised several times since.

How Neoffice generates it

Neoffice maintains real-time VAT balances in the accounting module (VAT debtor accounts, creditor accounts, input tax). At the end of each quarter, the VAT module generates a summary ready for the FTA covering all boxes of the official form. The user simply needs to enter the figures on the efin portal or pass them to their fiduciary. Both methods — effective and NDFR — are supported.