English translation of Article 13 of the Swiss VAT Act

This page contains an English translation of the below Article of the revised Swiss VATA 2010 and is part of a web based Swiss VATA 2010 commentary published in German. Should you require qualified written legal advice on cross-border transactions potentially triggering Swiss VAT  from a Swiss VAT lawyer please do not hesitate to contact: Harun Can


Article 13 of the Swiss VAT Act 2010
 
Group taxation


  1. Legal entities with their place of business or a permanent establishment in Switzerland which are closely associated with one another under the common control of a single legal entity may on application combine as a single taxable person (a VAT group). The group may also include legal entities which do not operate a business, and individuals.  
     
  2. The decision to combine as a VAT group may be made at the commencement of any tax period. Termination of a VAT group is possible at the end of any tax period.
 

Swiss VAT Ordinance

Article 15 of the Swiss VAT Ordinance 2010 (Common direction) clarifying Article 13 of the Swiss VAT Act 2010

Common control is given if the conduct of a legal person is controlled by the majority of the votes, by contract, or by other means.

Article 16 of the Swiss VAT Ordinance 2010 (Group members) clarifying Article 13 of the Swiss VAT Act 2010

  1. Partnerships without legal capacity are deemed to be legal persons for the purpose of Article 13 of the Swiss VAT Act 2010.
  2.  
  3. Insurance agents may be members of a group.
  4.  
  5. Occupational welfare organizations may not be members of a group.

Article 17 of the Swiss VAT Ordinance 2010 (Formation of a group) clarifying Article 13 of the Swiss VAT Act 2010

  1. The  members of the VAT group can be freely determined from among those entitled to participate in group taxation.
  2.  
  3. The formation of several sub-groups is permissible.
  4.  

Article 18 of the Swiss VAT Ordinance 2010 (Authorization of group taxation) clarifying Articles 13 and 67, Section 2 of the Swiss VAT Act 2010

  1. Upon application, the Federal Tax Authority grants the authorization of group taxation, provided the relevant conditions are met.
  2.  
  3. Written declarations are to be enclosed with the application by the individual group members, in which they declare their consent to group taxation and its effects and the joint representation by the group member or person designated therein.

  4. The application is to be submitted by the group representative. The group representative may be:
a. a member of the VAT group resident in Switzerland; or
b. a person who is not a member with residence or place of business in Switzerland.

Article 19 of the Swiss VAT Ordinance 2010 (Changes in group representation) clarifying Article 13 of the Swiss VAT Act 2010

  1. Resignation from the representation of a VAT group is possible only at the end of a tax period. The resignation must be notified to the Federal Tax Authorities in writing at least one month in advance.
  2.  
  3. If the former group representative resigns and a new group representative is not reported in writing to the Federal Tax Authorities one month before the end of the tax period, the Federal Tax Authorities can after prior warning designate one of the group members as the group representative. 

  4. The group members can jointly withdraw the mandate from the group representative provided that they simultaneously designate a new group representative. Section 1 applies by analogy.

Article 20 of the Swiss VAT Ordinance 2010 (Changes in the membership of the group) clarifying Article 13 of the Swiss VAT Act 2010

  1. If a member no longer fulfills the requirements for participating in group taxation, the group representative must notify the Federal Tax Authorities in writing.
  2.  
  3. Upon application, the legal person can join an existing group or a member can leave a group. The Federal Tax Authorities authorize the entry or withdrawal for the beginning of the following or the end of the current tax period.  

  4. If a legal person, for whom the requirements for participation in group taxation were not formerly present, now fulfils the requirements, admission to an existing VAT group can also be applied for during the current tax period, provided the relevant application is submitted to the Federal Tax Authorities in writing within 30 days of publication of the applicable change in the Commercial Register or after the requirements are met.

Article 21 of the Swiss VAT Ordinance 2010 (Administrative and accounting requirements) clarifying Article 13 of the Swiss VAT Act 2010

  1. The members must close their accounts on the same reporting date; this does not apply to holding companies if for accounting reasons they have a different accounting date.
  2.  
  3.  Each member must prepare an internal VAT return, which is to be consolidated in the VAT group’s return. 



Corresponding Article(s) of the EU VAT Directive (Recast) 2006/112/EC (as of January 2010)

Article 11 of the EU VAT Directive

After consulting the advisory committee on value added tax (hereafter, the ‘VAT Committee), each Member State may regard as a single taxable person any persons established in the territory of that Member State who, while legally independent, are closely bound to one another by financial, economic and organisational links.

[...]

Comments