Insights

The new Federal Act on Data Protection (nFADP) and the corresponding ordinance will come into force in Switzerland on 1 September 2023. All companies that process personal data which affects natural persons in Switzerland fall within the scope of the law and are equally affected. Regardless of the industry in which you operate and regardless of the size of your company, you must comply with the new legal requirements.

For the tax assessment of advances and loans in Swiss francs and in foreign currencies, the Swiss Federal Tax Administration (FTA) publishes the recognised interest rates annually. The interest rates were massively increased in 2023 compared to previous years.

If a profit is made through the sale of a property in Liechtenstein, the seller must pay property gains tax (Grundstücksgewinnsteuer). The tax is levied on the difference between the initial investment costs and the proceeds of the sale. The investment costs include not only the purchase price but also, for example, value-enhancing expenses. It is not always clear whether a measure is value-enhancing or merely value-maintaining. Christian Reichert and Michael Heeb have summarised the topic in an article in the Wirtschaftregional of 10 February 2023, explaining how the real estate gain is calculated, which special cases exist and why you should already keep the tax in mind when acquiring a property.

With Revenue Procedure 2022-43, the US tax authority IRS published the new Qualified Intermediary (QI) Agreement in December 2022. All Qualified Intermediaries – i.e. the vast majority of banks and securities firms – have until 1 May 2023 to convert their existing QI Agreement into the new version on the electronic IRS portal.

The question of the extent to which cryptocurrencies and other virtual assets are reportable within the framework of the automatic exchange of information (AEOI) has preoccupied financial institutions for several years. At the end of 2022, the OECD adopted a draft for a system for reporting crypto assets, the so-called Crypto-Asset Reporting Framework, or CARF for short. What does the CARF contain and what are the reporting obligations?

Changes in commercial law effective January 1, 2023, result in various tax planning opportunities and increased flexibility. This is especially true for foreign-controlled Swiss companies.

The private law establishment is very popular due to her flexibility. The establishment in Liechtenstein has no counterparts in other legal systems. The establishment may be structured like a foundation or a corporation. The law defines the establishment as a legally autonomous, organized, permanent undertaking dedicated to economic or other objects and entered in the Commercial Register, which has holdings of material and possibly personal resources.

The Swiss “Aktiengesellschaft” or abbreviated “AG” (in English: “company limited by shares” / “Ltd.”) is the most preferred legal form of a Swiss company.

The Liechtenstein foundation is a legal entity without shareholders. A foundation has beneficiaries who are entitled to enjoy the foundation assets and/or income according to the will of the founder. The Liechtenstein foundation is used for asset protection and estate planning. The Foundation is regulated in art. 522 § 1 – 41 of the Liechtenstein Persons and Companies Act (PGR).

The Swiss “Aktiengesellschaft” or abbreviated “AG” (in English: “company limited by shares” / “Ltd.”) is the most preferred legal form of a Swiss company.

Liechtenstein is the only continental European country where the legal structure of a trust is known. With a trust, the settlor endows trust assets upon the trustee, together with the obligation to manage and use them in his own name and on the behalf of the rules in the trust deed.

The Swiss “Gesellschaft mit beschränkter Haftung” or abbreviated “GmbH” (in English: “limited liability company” / “LLC”) is the second most preferred legal form of a Swiss company. It is usually established in cases where the founders only have access to a limited amount for the company capital.

Two key amendments, in particular, will come into effect on 1 January 2023 as part of the AMLA revision: the obligation to verify the details of the beneficial owner and the obligation to update client details at regular intervals.

The new Swiss corporate law will enter into force on January 1st, 2023. The key changes are greater flexibility for share capital and equity distributions, enhancement of shareholders’ rights in terms of better corporate governance and modernization of shareholders’ meetings. The following provides an overview of the main innovations from a practical point of view.

Increase in maximum pillar 3a deductions in the 2023 tax year.

EU Directive 2019/1937 on the protection of persons who report breaches of Union law («Whistleblower Directive») entered into force on 16 December 2019. The Whistleblower Directive is intended to facilitate the disclosure of breaches of EU law and guarantee a uniform, high level of protection for whistleblowers throughout the entire EU. It has far-reaching consequences and is also relevant for Swiss companies with a presence in the EU area.