Axcord is the leading firm in tax planning and negotiation

Swiss lump-sum taxation offers interesting opportunities to High-net-worth individuals (HNWI) and allows to reside in Switzerland without paying taxes on the effective foreign income and wealth.

We offer to our clients advance tax planning allowing them to understand the opportunities of this tax regime. In this respect, we make an advance calculation of tax liabilities and advise on how to properly structure the wealth and business in order to reduce tax liabilities and be compliant with the Swiss legislation.

Once the preliminary tax planning is complete, we negotiate lump-sum agreements with tax authorities of the chosen canton, considering the client’s specific situation, and apply for a residence permit for the client and his family.

After the relocation, we provide the necessary follow-up of the situation of lump-sum taxpayers including succession planning, analysis of the possible impact of investments into the Swiss economy (including acquisition or improvement of real estate) and international tax aspects.

Switzerland is one of the rare countries that fully exempt private capital gains from income tax.

In practice, this rule mainly applies to the sale of securities, such as shares or bonds. In view of this rule, properly structured Management Equity Plans may offer interesting opportunities to top-level executives residing in Switzerland.

Our firm regularly advises international firms and Private Equity funds on structuring of MEPs and assists them with an advance negotiation of the tax rulings with the authorities.

Corporate income tax (CIT) rates in Switzerland are currently very low in international comparison with the average rate being around 13%-14%.

Still, there are many cases where it is possible to substantially reduce these rates. These cases typically include immigration step-up, international allocation of income in case of foreign presence, temporary tax exemption and other newly introduced measures such as patent box or R&D superdeduction.

Our firm regularly advises different types of businesses, ranging from small companies to publicly traded corporations, on the tax consequences resulting from the structuring of their activities. We also negotiate tax rulings with the authorities which are both effective and compliant with the domestic legislation and international tax standards.

It is a well-known fact that Swiss withholding tax (WHT) rate on dividend distributions is one of the highest in the world, being of 35% on gross distribution proceeds.

This being said, there are many cases and exceptions where withholding tax may be reduced to a lower rate or even become a formality with the 0% rate.

We regularly advise our clients on the international tax structuring, taking into account all aspects of the practice of the Swiss tax authorities and courts and negotiate advance tax rulings securing their position.

Transfer pricing is being actively developed both at international and domestic levels. Our specialists help to structure transactions between related parties in accordance with the current international standards, prepare the necessary transfer pricing documentation and provide the necessary assistance in case of tax audits.

Based on the new international standards, most countries may request from Swiss-based “information holders” (such as banks, fiduciary agents, or other service providers) any information that may be helpful for taxation in the requesting countries (such as bank statements, information about tax status and assets in Switzerland, etc.).

In view of the current international rules, most of these requests result in the collection and transfer of all requested information to the requesting country. This being said, our experience shows that in many cases the collected and transmitted information exceeds the scope determined by international tax rules.

Our firm regularly represents foreign tax payers in Switzerland with respect to the international administrative procedure in tax field. Many of our interventions have resulted in the complete cancellation of information exchange requests or in the substantial reduction of their scope. In the particular cases where no reduction of the scope is possible, we prevent the immediate transmission of the information thereby allowing to the tax payer to duly examine the transmitted documentation and to prepare the defence in the requesting country.

Swiss tax authorities have a long-standing practice of granting advance tax rulings for the cases where the tax treatment is uncertain.

The advance tax rulings are based on a preliminary tax analysis of facts before they actually take place. Provided that the tax authorities agree on the proposed tax treatment, the rulings grant to the tax payers the legal security and cannot be challenged during the taxation procedure. We help to our clients to identify the tax planning opportunities, and to negotiate the relevant advance tax rulings with the tax authorities.

In case of tax audits, it is of importance to properly present all key facts to the tax authorities, thereby avoiding unnecessary litigation. In many cases, it is even possible to reach a reasonable agreement during tax audit.

For the cases that involve litigation with the tax authorities, the result usually largely depends on the presentation of facts and on the invoked legal arguments which should take into account not only the laws and the practice of the courts, but also of the practice of the tax authorities.

As a matter of fact, it is not unusual that the tax authorities fully or partially agree with the position of the tax payer in the course of litigation.

We successfully represent our clients before courts and always tend to find a pragmatic approach not only resulting in the cancellation of the tax adjustments, but also avoiding unnecessary costs for our clients.