RSM Switzerland - August 2024 Newsletter

We are writing to you with the latest news for August 2024.

Excessive Salary for Shareholder-Employees: How to avoid tax pitfalls?

Is your salary considered excessive by the tax authorities? A salary deemed too high could be reclassified as a disguised profit distribution, leading to severe tax consequences. Discover how the authorities assess salaries, the associated risks, and how to prepare a solid justification to avoid tax pitfalls.

Update on the Automatic Exchange of information cross-border employment and compensation information

Starting in 2026, a specific rule will require Swiss employers to automatically send the salary data of cross-border workers to their residence state in France. This aims to improve tax transparency and simplify tax management while adhering to international standards.

Tax Deductibility of Vacation Provisions

In July 2024, the Federal Court ruled that provisions for unused vacation days are not tax-deductible in Switzerland, as they are considered reserves for future obligations. Companies must revise their accounting practices to avoid potential tax adjustments.

Resale of own shares to employees

On June 6, 2024, the Federal Court ruled that the resale of own shares to employees, with no impact on profit, is not taxable. This decision could affect the tax treatment of stamp duties and capital contribution reserves.

Discover our Doing Business in Switzerland Guide

Are you interested in knowing more about the business environment in Switzerland? Our Guide to Doing Business in Switzerland 2024?is now LIVE!

Excessive Salary for Shareholder-Employees: How to avoid tax pitfalls?

Could your salary as a shareholder-employee be deemed excessive by the tax authorities? A salary considered too high might be reclassified as disguised profit distribution, leading to significant tax adjustments for your company. In our article, find out how the authorities assess salaries and the criteria used to determine what is deemed excessive. Ensure your salary policy is compliant to avoid unexpected costs.

Explore further about it here

Update on the Automatic Exchange of information cross-border employment and compensation information

Major changes are coming for cross-border workers between Switzerland and France. A new specific rule will establish automatic exchange of salary data to enhance tax transparency between the two countries. Starting in 2026, Swiss employers will need to send crucial information, such as income and telework days, directly to the employee's residence state. This change aims to simplify tax management and ensure better compliance with international rules. Find out how this might affect you, with the new rules applying from 2026 for 2025 income!

Learn more about this subject here

Tax Deductibility of Vacation Provisions

The Swiss Federal Court decided in July 2024 that provisions for unused vacation days are not tax-deductible, classifying them as reserves for future obligations. This ruling may lead to changes in corporate accounting practices. Discover how this development could impact your business and what you need to know to stay compliant.

Find out more by clicking here

Resale of own shares to employees

On June 6, 2024, the Federal Court ruled that the resale of own shares to employees, with no impact on profit, is not taxable. This decision clarifies that increases in the value of the shares do not generate taxable income and could affect the tax treatment of stamp duties and capital contribution reserves. Discover our article to learn more about this ruling and its potential impact.

Find out more about it here

Doing Business in Switzerland Guide

Are you interested in knowing more about the business environment in Switzerland? Our RSM experts have the answers you’re looking for and have tailored a comprehensive brochure for you.

Click here to download our guide!

Contact us!

Please do not hesitate to contact us if you have any questions on the topics presented in this newsletter, or for any other information concerning?our business areas. Our experts will be happy to answer you and will be able to provide you with advice and solutions tailored to your needs.

Our mailing address is: [email protected]