Switzerland – Annual VAT reporting for Eligible Small Businesses

As of January 1, 2025, Swiss VAT-registered small and medium-sized enterprises (SMEs) are able to opt for annual VAT reporting instead of the previous quarterly or monthly submissions.

Eligibility and Conditions
To qualify for the annual VAT reporting option, businesses must meet specific criteria set by the Swiss Federal Tax Administration (SFTA) as follows:

– Annual Turnover Threshold:
The annual taxable turnover must not exceed CHF 5,005,000.

– Compliance History:
The taxpayer must have a history of filing VAT returns and paying tax claims on time and in full for the previous three tax periods. For newer businesses, the SFTA considers the periods since the tax liability began.

Businesses that meet these conditions can apply to switch to annual reporting via the Tax Administration’s ePortal. For the 2026 tax period, the application deadline is 28th February 2026.

Reporting Process
While the filing frequency is annual, eligible businesses are still required to make advance payments throughout the year. The Tax Administration assesses the amount of advance payments, typically based on the previous year’s tax liability. Three instalments must be paid in the effective and flat-rate tax rate methods and one instalment in the case of the net tax rate method. The due dates of the instalments for the effective and flat-rate tax rate methods are 30 May, 30 August and 30 November. In the case of the net tax rate method, the due date is 30 August. In the event of late payment, interest on arrears is due on both the instalments and the annual statement. These advance payments are offset against the final tax due, which is determined upon the submission of the annual return by the end of February of the following year. Any excess amount is refunded.

Revocation of the Annual VAT reporting option:
The SFTA can revoke the authorization for annual reporting if a business:

– Exceeds the turnover threshold of CHF 5,005,000.

– The taxpayer revokes the annual statement via ePortal by the end of February after the beginning of the tax period at the latest

– Fails to submit the annual return on time.

– Has unpaid VAT debts or requests an excessive reduction of advance payments.

Businesses that lose their eligibility will be required to revert to more frequent reporting periods, such as quarterly or semi-annual returns.

Considerations for Businesses
The annual reporting option offers administrative relief, but it requires careful cash flow planning to manage advance payments. Businesses expecting regular VAT refunds may find more frequent reporting methods (quarterly or monthly) more beneficial to receive refunds sooner.

Failure to comply with payment schedules, exceeding the turnover threshold, or other legal issues may result in the Tax Administration revoking the annual reporting privilege. Once a business switches to annual reporting, it must remain in that cycle for at least one full tax period.