The tax assessment

Tax assessment refers to the obligatory calculation of an individual’s amount liable to be taxed. For this process, a distinction can be made between three forms of assessment. There is the self-assessment, the official assessment and the mixed assessment. If you have any questions regarding the procedure of a tax assessment, our tax lawyers are happy to help you.

relevant AUTHORITY

The authority responsible for the assessment procedure differs depending on whether the tax is a federal, cantonal or municipal tax. This results from the fact that the application of federal tax law is in principle the sole responsibility of the Federal Department of Finance and its administrative branches. Thus, the Federal Tax Administration (FTA) is responsible for the collection of VAT, anticipatory tax and tax law. The assessment of the direct federal tax is carried out by the cantons. The cantonal tax administrations are responsible for the implementation of the cantonal and communal tax law.

SELF-ASSESSMENT

According to Swiss tax law (VAT Act 66 I,III; Withholding Tax Act 38 I; Federal Law on Stamp Duties 34 I), everyone who is liable to pay tax must register with the FTA without being request to do so. A tax liable person is obliged to submit a statement of their account within the deadline and without further request. The submitted statements are checked by the FTA on an ongoing or periodic basis. If the legal obligations for the tax assessment are not fulfilled, the FTA will make a correction. In the event of a breach of procedural obligations, a mandatory discretionary assessment is possible.

OFFICIAL ASSESSMENT

Regarding the official assessment no action is necessary on the taxpayer’s behalf, as the tax authority carries out the assessment themselves. This form of assessment is used, for example, for the transfer of ownership tax. This is a legal transaction tax which is levied when the rights in rem to a property are transferred to another person. The finite implementation is left to the cantons and is therefore not regulated uniformly throughout Switzerland.

MIXED ASSESSMENT

A mixed assessment is used for income tax, wealth tax, profit tax and capital tax. These are usually assessed in a single procedure by the cantonal tax authority. According to the general requirements, every taxpayer has to submit a tax return periodically. The tax return form must be filed in line with the truth and in its entirety. The tax administration is responsible for the subsequent inspection of the tax return’s accuracy, but taxpayers are obliged to cooperate at this stage as well. Once the inspection is complete, the respective administrative authority submits a request to the assessment authority or sets the basis for a tax calculation and the resulting tax sum itself. If any deviations are made from the tax return, they must be disclosed with the assessment order at the latest. If the taxpayer violates their procedural obligations despite a reminder, a discretionary assessment is made. Another reason for a discretionary assessment is the lack of reliable documentation, which prevents the proper discernment of tax factors. For the discretionary assessment, tax authorities rely on empirical figures, asset development and the taxpayer’s living expenses.

If you have any questions about your tax assessment, please contact one of our attorneys specializing in tax law.