Switzerland’s vat: new obligations for Italian companies

From 1 January 2018, following the revision of the LIVA law, foreign companies, therefore also Italian ones, that performs services in Switzerland with a global turnover of at least 100,000 CHF (including also turnover generated outside the Confederation), will be required to register as tax payers (to obtain a Swiss VAT number) and to pay VAT in Switzerland

Specifically, Italian and foreign companies, in order to avoid problems with the Federal Tax Administration, will have the obligation to appoint a tax representative in Switzerland, so that it complements the invoices and regularly prepares the IVA quarterly report.

The appointment of the tax representative must take place in a preventive manner with respect to the provision of the service, also taking into consideration the processing times of the VAT offices for the opening of the position.

From 2018, other legislative changes also take effect in Switzerland, including the reduction of VAT rates, which will be equal to 7.7% (ordinary); 2.5% (reduced - food, other agricultural products, medicines and publishing) and 3.7% (special hotel trade). Significant changes in the field of mail order sales will come into force starting from the 2019 year.

It is advisable that Italian and foreign companies that provide services in the Swiss territory, proceed as soon as possible with the appointment of a tax representative. Particular attention also due to the limitations and authorizations related to certain kind of services performed in some cantons ( for example for Ticino, registration in the LIA register for craft workers.

Our office is available to offer tax representation services and to provide any clarification on the issues above.