VAT for Small Businesses in Switzerland: Registration, Rates and Methods
When you must register, how input tax works and how the flat-rate method can simplify things.
5 min read · Business & Freelance
Value added tax (MWST) applies to most goods and services. As a small business you need to know when and how to deal with it.
When to register
You must register once your worldwide taxable turnover exceeds CHF 100,000 per year (the limit differs for non-profit organisations). Below it, you can register voluntarily, mainly to claim input VAT on larger purchases.
Example with default values. Open the calculator →
Rates
- 8.1 % standard rate.
- 2.6 % reduced rate (food, books, medicines).
- 3.8 % special rate for accommodation.
Effective and flat-rate methods
With the effective method you charge VAT, subtract the input VAT you paid on expenses and send the difference to the tax authority. With the flat-rate method (Saldosteuersatz), you pay a fixed percentage of turnover and cannot deduct input VAT. It reduces effort but is only available to small businesses.
Returns and records
Most businesses file quarterly or half-yearly returns online. Keep invoices that show the VAT number and amounts, and issue correct invoices to customers.
Check which method fits
If you buy a lot of equipment, effective may be better; with few costs, flat rate could be cheaper. Compare with the VAT method calculator.