Swiss VAT: rates, return and obligations

Q: From what turnover must a business register for Swiss VAT?

As a general rule, any business whose annual turnover exceeds CHF 100,000 (from taxable supplies on Swiss territory) is required to register for VAT. Below this threshold, voluntary registration is possible if advantageous (notably to recover input tax).

Q: What VAT rates have been in force since 2024?

Since 1 January 2024, the rates are: standard rate 8.1% (majority of goods and services), reduced rate 2.6% (foodstuffs, medicines, newspapers, books) and special accommodation rate 3.8% (hotel and para-hotel overnight stays). These rates were increased to fund the AHV pension system.

Q: How does Neoffice manage Swiss VAT?

Neoffice integrates all three Swiss VAT rates and automatically allocates them by invoice line according to the type of service. The VAT return (effective method or net tax rate method) is generated directly from the ERP, ready to be submitted on the FTA portal.

Definition

Swiss VAT (German: Mehrwertsteuer, MWST; Italian: Imposta sul valore aggiunto, IVA) is a federal indirect tax levied at each stage of the production and distribution chain, but ultimately borne by the final consumer. It is governed by the Federal Act on Value Added Tax (VAT Act) and administered by the Federal Tax Administration (FTA).

Rates currently in force

Since 1 January 2024, Switzerland applies three VAT rates, raised as part of the AHV financing (vote of 25 September 2022):

Rate	Value	Area of application
Standard rate	8.1%	All goods and services not listed below
Reduced rate	2.6%	Foodstuffs, non-alcoholic beverages, medicines, newspapers, books, drinking water
Special accommodation rate	3.8%	Hotel and para-hotel overnight stays (with or without breakfast)

These rates replaced the former rates of 7.7%, 2.5% and 3.7% in force until 31 December 2023.

How it works

VAT operates through the input tax deduction mechanism:

Output tax: the taxable person charges VAT to their clients on their sales.
Input tax: the taxable person recovers the VAT paid to their own suppliers on professional purchases.
Balance due: the difference between output tax and input tax is remitted to the FTA at each filing period.

This mechanism ensures that VAT is effectively paid only once, by the final consumer.

Swiss context

Swiss VAT has several distinctive features compared to European regimes:

Registration threshold: CHF 100,000 in annual turnover (voluntary registration possible below this threshold).
Filing methods: effective method (full right to deduct input tax) or simplified methods (net tax rate method, flat-rate methods).
Frequency: quarterly filing by default, semi-annual filing possible for small structures under certain conditions.
Online declaration: via the FTA online portal (efin.estv.admin.ch).

How Neoffice manages it

Neoffice automatically applies the correct VAT rate according to the nature of each sales or purchase line. The accounting module generates the VAT return ready for the FTA, whether using the effective method or the net tax rate method. VAT accounts (tax due, input tax, input tax correction) are updated in real time with each accounting entry.