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Swiss tax audits may concern both direct and indirect taxes and can cover significant retrospective periods. Being properly prepared and supported during a tax audit is essential to limit financial exposure, procedural risks and potential penalties.
RSM Switzerland assists companies and individuals during Swiss tax audits, from the initial preparation phase to representation, defence, negotiation and appeal procedures before the Swiss tax authorities.
Tax audits carried out by Swiss tax authorities
The Federal Tax Administration carries out audits of taxpayers with respect to VAT, withholding tax and stamp duties on issues and transactions. These audits generally cover periods of up to five years, corresponding to the statute of limitations applicable to indirect taxes.
Cantonal tax administrations are responsible for audits relating to direct taxes, including profit, capital, income and wealth taxes. In this context, audits may cover retroactive periods of up to ten years.
In cases where irregularities are identified, controls may become more frequent and more extensive.
Audit procedures and obligations of taxpayers
Tax audits are usually announced in writing. The tax authorities request the documents required for the audit and propose a date for the review.
During the audit procedure, taxpayers must:
- grant access to their accounts and accounting records;
- provide all relevant supporting documentation;
- supply any information requested by the tax authorities.
Swiss taxes are based on the principle of spontaneous declaration. Taxpayers are responsible for complying with their tax obligations and respecting legal deadlines without reminder.
Risks identified during tax audits
Common issues identified during tax audits include:
- errors in VAT statements;
- failure to submit stamp duty declarations;
- hidden dividend distributions subject to withholding tax.
Tax authorities do not limit their review to a formal analysis of submitted documentation but examine in detail:
- benefits in kind to employees and private part of company car;
- transactions with third parties;
- transactions with companies belonging to the same group in Switzerland or abroad.
Where irregularities are found, unpaid taxes may be recovered and, interest charged. In situations with aggravated circumstances such as intention or repetitions, penalties can imposed usually in proportion of the unpaid tax.
Direct tax audits and tax investigations
For direct taxes, audits are most often conducted through written requests rather than on site inspections. However, in cases of serious suspicion of tax evasion, the federal administration may initiate investigations involving a specialised tax police, including seizure and analysis of documents.
For both direct and indirect taxes, the first exchanges with the tax authorities are decisive and often condition the outcome of future discussions.
How RSM Switzerland supports you during a tax audit
Our specialists have extensive experience in VAT, stamp duty, withholding tax, as well as income and equity tax matters.
We provide comprehensive support, including:
- preparation of documentation and audit responses;
- assistance during audit meetings at your premises or ours;
- tax representation before the authorities;
- clarification and defence of tax positions;
- negotiation of pragmatic solutions.
Preventive tax check ups
We also offer preventive tax check ups before any announced audit. These may include targeted internal reviews, such as short VAT audits, allowing risks to be identified and corrected in advance.
Defence, complaints and appeal procedures
Even once an audit has been announced, professional support ensures that only relevant and proportionate information is shared with the authorities.
Where necessary, we assist clients throughout complaint and appeal procedures, defending their interests before the competent tax authorities and courts.
While negotiated solutions are always preferred, we provide full support in formal proceedings where disputes cannot be resolved amicably.
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