{"id":127372,"date":"2026-01-16T12:44:54","date_gmt":"2026-01-16T12:44:54","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=127372"},"modified":"2026-01-16T12:44:54","modified_gmt":"2026-01-16T12:44:54","slug":"switzerland-private-client","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/switzerland-private-client\/","title":{"rendered":"Switzerland: Private Client"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-127372","comparative_guide","type-comparative_guide","status-publish","hentry","guides-private-client","jurisdictions-switzerland"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Kellerhals Carrard<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2020\/03\/kellerhals.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Kellerhals Carrard<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2020\/03\/kellerhals.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Private Client laws and regulations applicable in Switzerland<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Which factors bring an individual within the scope of tax on income and capital gains?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>An individual is subject to unlimited tax liability in Switzerland if they are resident there, i.e. if Switzerland constitutes their main centre of vital interests (predominant personal and economic ties), if they have a statutory domicile, or if they habitually reside in Switzerland (30 days with gainful activity or 90 days without). Residents are taxed on their worldwide income and wealth, subject to treaty relief and statutory exemptions. Private capital gains on non real estate assets are generally tax exempt.<\/p>\n<p>Individuals without domicile or habitual residence in Switzerland are subject to limited tax liability if they have an economic nexus with Switzerland, in particular through a Swiss permanent establishment, participation in a Swiss business, or Swiss real estate. In such cases, only Swiss-source income and capital gains on localized assets are taxable, with worldwide income and wealth taken into account solely for rate-determination purposes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the taxes and rates of tax to which an individual is subject in respect of income and capital gains and, in relation to those taxes, when does the tax year start and end, and when must tax returns be submitted and tax paid?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Individuals in Switzerland are subject to income tax at federal, cantonal, and municipal levels. Federal income tax is progressive, while combined cantonal and municipal rates typically range from around 20% to over 40%, depending on the location. All taxable income is added to determine the applicable rate and principally includes employment and self-employment income (also subject to social security), investment and rental income, commercial capital gain (also subject to social security) and certain benefits in kind. Private capital gains on movable assets are generally tax-exempt, whereas capital gains on Swiss real estate are taxed and gains on business assets are taxable as income. Social security costs are borne equally between the employee and the employer, for a total average amount of approx. 10.5%.<\/p>\n<p>Switzerland does not generally levy exit taxes or impose deemed disposals upon expatriation, except in limited cases such as the withdrawal of pension benefits, as well as when commercial taxable assets with hidden reserve that have not been taxed are moved outside of Switzerland.<\/p>\n<p>Deemed income may arise in specific situations, including employee share plans (subject to social security), hidden profit distributions, or transfers of assets from business to private use. Tax exempt private capital gains may be recharacterized as taxable income where the individual qualifies as a professional securities or real estate dealer or certain operations such as a sale of shares to market value to an owned holding company.<\/p>\n<p>The tax year is the calendar year. Tax returns are filed in the following year.<\/p>\n<p>Switzerland offers for non-working foreigners a lump sum regime that replaces ordinary taxation.<\/p>\n<p>Individuals that are under 65 years old and do not exercise a gainful activity are subject to a wealth-based social security tax.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction provide advantageous tax regimes for individuals directly investing in or holding certain types of assets from an income tax or capital gains tax perspective?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Private capital gains on movable assets held as private wealth are generally income tax-exempt, representing a key advantage for private investors. Such exemption applies in particular to direct investments in equity and financial instruments or commodities. Dividends from qualifying shareholdings benefit from partial taxation at federal and cantonal levels of approx. 30%. In addition, foreign-source income may benefit from relief under applicable double taxation treaties of which Switzerland has signed many.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are withholding taxes relevant to individuals and, if so, how, in what circumstances and at what rates do they apply?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland levies a 35% withholding tax on certain remuneration type, in particular dividends from limited companies and bank interests. For Swiss residents, this tax is generally fully refundable upon proper declaration; for non-residents, relief depends on applicable double taxation treaties. No withholding tax applies to private capital gains. If a double tax treaty applies, Switzerland also credits definitive source taxes that have been paid in other countries.<\/p>\n<p>Salaries of certain non-resident individuals are subject to wage withholding tax, and social security contributions are withheld.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How does the jurisdiction approach the elimination of double taxation for individuals who would otherwise be taxed in the jurisdiction and in another jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland eliminates double taxation for individuals primarily through an extensive network of bilateral double taxation treaties, which generally follow the OECD Model Tax Convention, whilst also unilaterally exonerating certain foreign income from permanent establishment or real estate. These treaties allocate taxing rights between Switzerland and the other contracting state and typically provide for relief through either the exemption method (often with progression) or the foreign tax credit method, depending on the type of income and the treaty concerned. For individuals benefiting from the lump sum regime, the conventions are generally not applicable and their situation requires proper structuring.<\/p>\n<p>In cross-border situations involving limited tax liability abroad, Switzerland generally taxes only Swiss-source income, while taking worldwide income and wealth into account for rate-determination purposes (exemption with progression). Treaty provisions prevail over domestic law where applicable.<\/p>\n<p>Switzerland has signed and ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). The MLI is in force for Switzerland and modifies covered tax agreements in particular with respect to minimum standards.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a wealth tax and, if so, which factors bring an individual within the scope of that tax, at what rate or rates is it charged, and when must tax returns be submitted and tax paid?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland levies a net wealth tax at cantonal and municipal levels; there is no federal wealth tax. Swiss residents are subject to unlimited wealth tax on their worldwide net wealth, while non-residents may be subject to limited wealth tax on Swiss-situs assets, notably Swiss real estate or interests in Swiss real estate companies. Foreign real estate is only taken into account to determine the applicable tax rate. Assets are valuated at market value with specific instruments for non-liquid assets, with some discounts for businesses that serve as a working instrument for the taxpayer.<\/p>\n<p>Taxable wealth includes assets such as real estate, securities, bank deposits and participations, net of debts. Wealth tax rates are progressive and vary by canton and municipality, generally ranging from about 0.1% to 0,85%. Wealth tax is declared annually together with income tax. In certain cantons with a higher tax rate, a cantonal tax shield mechanism usually strongly reduces wealth tax with proper structuring.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is tax charged on death or on gifts by individuals and, if so, which factors cause the tax to apply, when must a tax return be submitted, and at what rate, by whom and when must the tax be paid?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Inheritance and gift taxes are levied at cantonal level (except in the canton of Schwyz); there is no federal inheritance or gift tax. Rules and rates vary significantly between cantons. In most cantons, transfers to spouses and direct descendants are fully exempt, while transfers to other beneficiaries may be taxed at progressive rates depending on the relationship and the canton with a maximum rate to non-related third parties that can reach 54%.<\/p>\n<p>Taxation is generally based on the domicile or residence of the deceased or donor and may also apply to Swiss-situs real estate assets, even if the deceased or donor was not Swiss-resident. Filing and payment obligations are governed by cantonal law and usually fall on the heirs or donees.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are tax reliefs available on gifts (either during the donor\u2019s lifetime or on death) to a spouse, civil partner, or to any other relation, or of particular kinds of assets (eg business or agricultural assets), and how do any such reliefs apply?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Tax relief for gifts and inheritances in Switzerland is governed by cantonal law, as there is no federal inheritance or gift tax, meaning the regimes vary greatly. In most cantons, transfers to spouses or registered partners and to direct descendants are fully exempt. Many cantons also grant relief for transfers of business or agricultural assets, typically to facilitate business succession, subject to conditions such as continued operation or holding periods.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do the tax laws encourage gifts (either during the donor\u2019s lifetime or on death) to a charity, public foundation or similar entity, and how do the relevant tax rules apply?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Swiss tax law encourages gifts and bequests to charities and public-interest entities. Lifetime donations to Swiss tax-exempt charitable entities are generally deductible from taxable income, at a maximum of 20% of taxable income. Gifts and bequests to such entities are typically exempt from gift and inheritance tax at cantonal level although they are non-related parties. Eligibility depends on the recipient\u2019s recognized tax-exempt, public-interest status.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is real property situated in the jurisdiction taxed, in particular where it is owned by an individual who has no connection with the jurisdiction other than ownership of property there?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Swiss real estate is taxable in Switzerland regardless of the owner\u2019s residence. Non-resident owners are subject to limited tax liability in respect of Swiss property. Rental income is added to taxable income, as well as owner-occupied property that is currently subject to imputed rental income. Capital gains on privately held real estate are taxed at cantonal level under a real estate capital gains tax that is typically degressive with the duration of holding the asset, with a lowest rate of 2% to 10% for a 25-year holding period. Gains on commercially owned real estate are added to ordinary taxable income.<\/p>\n<p>Swiss real estate is also included in the cantonal and municipal wealth tax base, and many cantons levy an annual real estate property tax.<\/p>\n<p>Some cantons or municipalities also levy a transfer tax on transfers of real estate. The tax basis is typically market value and the tax rate can typically vary from 1% to 4%. In some canton, transfer of companies holding real estate are not subject to such transfer rights.<\/p>\n<p>The imputed rental value system is scheduled to be abolished, with entry into force expected in 2028, potentially accompanied by a new tax on second homes. For non-residents, Switzerland taxes only income, gains, and wealth attributable to the Swiss property, with worldwide income and wealth considered solely for rate-determination purposes, subject to applicable tax treaties.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction have any specific rules in relation to the taxation of digital assets?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland does not have a separate tax regime for digital assets; instead, cryptocurrencies and other digital assets are taxed under general tax principles, based on their legal and economic character. In practice, capital gains on such assets currently typically qualify as tax free capital gains under certain conditions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are taxes other than those described above imposed on individuals and, if so, how do they apply?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In addition to income, wealth, and transfer taxes, individuals in Switzerland may be subject to a minor limited number of other charges, notably annual motor vehicle tax and, where applicable, church tax at cantonal or municipal level, as a well as the federal consumption tax (VAT) that can also apply to imported goods or pieces of estate such as art or private vehicles, including aircrafts.<\/p>\n<p>Certain indirect duties and fees may also arise in specific situations (e.g. securities transfer stamp duty, generally borne by financial intermediaries).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction provide advantageous special tax regimes for individuals from a wealth tax, inheritance\/estate tax or gift tax perspective?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland offers a lump-sum taxation regime based on expenditure for certain newly arrived individuals. Qualifying foreign nationals who become Swiss tax residents, and that are not Swiss citizens, and do not carry out gainful employment in Switzerland may, subject to cantonal law, be taxed on their living expenses rather than on actual worldwide income and wealth. The minimum taxable base subject to income tax (and that includes wealth tax) varies by cantons but cannot be lower than CHF 400\u2019000 at the federal level for federal income tax. For non-EU citizens, the minimum taxable basis is typically higher in certain cantons. The regime is subject to minimum assessment thresholds, is available only in certain cantons, and applies upon first taking up Swiss tax residence (or after a long absence of minimum 10 years).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What steps might an individual be advised to consider before establishing residence in (or becoming otherwise connected for tax purposes with) the jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>An individual should first determine the canton of Swiss tax residence, as cantonal and municipal rates and the availability of regimes such as lump-sum taxation vary significantly. Asset and income structures should be reviewed before arrival, in particular the realization of latent capital gains and the classification of assets as private or business. Employment arrangements and equity or incentive plans should also be analyzed to avoid unintended income taxation or Swiss social security exposure. Finally, incorporating trusts prior to establishing in Switzerland is typically recommended provided the settlor is not a beneficiary, as such trusts are not recognized whilst the settlor is alive if incorporated as ordinary taxpayers in Switzerland.<\/p>\n<p>Further considerations include inheritance and gift planning, wealth tax exposure, especially with regards to structuring allowing for an efficient use of the tax shield mechanism to reduce wealth tax exposure, treaty implications, and proper documentation of tax residence. Early coordination with Swiss and foreign tax advisers is recommended to manage cross-border risks as Switzerland recognizes foreign instruments. Future tax consequences following an implementation in Switzerland can be secured through an advance tax ruling established by the cantonal and federal tax authorities.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Once an individual has left (and is no longer connected for tax purposes with) the jurisdiction, does the jurisdiction charge any form of exit tax or retain taxing rights over the individual's directly held assets or structures which they created or have an interest in?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland does not impose a general exit tax. However, Swiss taxation may continue to apply to Swiss real estate and to assets or income connected with a Swiss business or permanent establishment. The transfer of business assets abroad, or generally into private assets through a donation to heirs, may trigger taxation of hidden reserves, and Swiss-source income may remain taxable under domestic law and applicable tax treaties.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the main rules of succession, and what are the scope and effect of any rules of forced heirship? Do any forced heirship rules apply automatically, or is it necessary for heirs to bring claims to enforce their rights?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The estate of a deceased person is generally distributed in accordance with legal provisions.<\/p>\n<p>Only the spouse or registered partner and the descendants of the deceased are entitled to a compulsory portion. Parents and siblings have no claim to statutory entitlement. The compulsory portion amounts to half of the statutory succession rights. For example, the compulsory portion of the descendants of a deceased (single) is half of their statutory succession rights (100%), i.e. 50%. The remainder (50%) corresponds to the part freely disposable to the deceased.<\/p>\n<p>The heirs are not automatically entitled to their statutory entitlement and must obtain it, if necessary, by means of an action in abatement.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a special regime for matrimonial property or the property of a civil partnership, and how does that regime affect succession?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>1. Participation in acquired property<\/strong><\/p>\n<p>Each person retains his or her pre-marital property (individual property) and independently administers property acquired during marriage (acquired property). In the event of divorce\/death, the acquired property is in principle divided equally between the spouses (liquidation of the marital property regime).<\/p>\n<p>The surviving spouse receives half of the acquired property.<\/p>\n<p><strong>2. Community of property<\/strong><\/p>\n<p>The spouses&#8217; assets are managed jointly and divided equally in the event of divorce or separation.<\/p>\n<p>The surviving spouse receives half of the common property.<\/p>\n<p><strong>3. Separation of property<\/strong><\/p>\n<p>Nothing is shared between the spouses in the event of divorce or separation.<\/p>\n<p>The surviving spouse receives nothing from the point of view of marital law.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What factors cause the succession law of the jurisdiction to apply on the death of an individual?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>With regard to jurisdiction, the Swiss judicial or administrative authorities at the last domicile of the deceased have in principle jurisdiction. Swiss authorities may also have jurisdiction in the absence of the deceased&#8217;s last domicile in Switzerland, for example if the deceased was domiciled abroad and the foreign authorities do not deal with the estate.<\/p>\n<p>As for the applicable law, the estate of a person\u2019s last domiciled in Switzerland is in principle governed by Swiss law. The deceased may nevertheless designate by Will or inheritance agreement the law of one of his or her national States.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How does the jurisdiction deal with conflict between its succession laws and those of another jurisdiction with which the deceased was connected or in which the deceased owned property?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The estate of a person who had their last domicile in Switzerland is governed by Swiss law. The estate of a person who had their last domicile abroad is governed by the law referred to by the private international law rules of the state of domicile. If these rules refer the matter back to Swiss private international law, the substantive succession law of the state of domicile shall apply.<\/p>\n<p>Switzerland has concluded international agreements notably with Austria, Greece, Italy, Portugal, United States.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In what circumstances should an individual make a Will, what are the consequences of dying without having made a Will, and what are the formal requirements for making a Will?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>A Will should be made in particular if the deceased wishes:<\/p>\n<ul>\n<li>to provide for portions of the estate that deviate from the statutory provisions;<\/li>\n<li>that an heir receives only his or her statutory entitlement;<\/li>\n<li>that an heir receives nothing (disinheritance);<\/li>\n<li>to stipulate burdens and conditions;<\/li>\n<li>to bequeath a legacy;<\/li>\n<li>to provide for rules of division (how his or her assets will be divided among the heirs);<\/li>\n<li>to subject his estate to the jurisdiction and\/or the law of a particular state.<\/li>\n<\/ul>\n<p>The Will must be drawn up in the following forms:<\/p>\n<ul>\n<li>Public deed: by notary public\/public official, in the presence of two witnesses;<\/li>\n<li>Holographic Will: written in full, dated and signed by the testator;<\/li>\n<li>Oral will (in exceptional circumstances only): conducted in the presence of two witnesses.<\/li>\n<\/ul>\n<p>Switzerland is a party to the Hague Convention on the conflict of laws in the formal requirements of the testamentary dispositions of 5 October 1961. This convention facilitates the international recognition of Wills by designating, among a set of laws, the law of several alternative states that can be deemed to govern the form of testamentary disposition. In this context, it is not necessary for a foreigner domiciled abroad to draw up a specific will for Swiss assets. Provided the foreign Will complies with the formal requirements of one of the jurisdictions designated by the aforementioned convention, it will be recognised in Switzerland.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is the estate of a deceased individual administered and who is responsible for collecting in assets, paying debts, and distributing to beneficiaries?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Swiss law, the estate is in principle administered by the heirs. In the absence of a dispute, the heirs quickly receive a certificate by the authority confirming their position and rights over the estate. If the Will so provides, the estate is administered by an executor appointed by the deceased. In certain circumstances, the authority must appoint an official administrator. Finally, the heirs may ask the judge to appoint a representative to administer in the event of difficulties between them. In principle, the heirs divide the estate themselves and distribute the legacies. The executor distributes the legacies, but only proceeds with the division in agreement with all the heirs or on the basis of a judgment.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do the laws of your jurisdiction allow individuals to create trusts, private foundations, family companies, family partnerships or similar structures to hold, administer and regulate succession to private family wealth and, if so, which structures are most commonly or advantageously used?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under the Swiss Civil Code, family foundations are permitted only in a strict framework and, consequently, are rarely established in practice.<\/p>\n<p>However, family limited companies, generally in the form of a family office, are increasingly used for purposes of tax or estate planning, notably for individuals who do not meet the criteria for the lump-sum taxation regime based on expenditure.<\/p>\n<p>In addition, individuals often use foreign structures, most commonly and advantageously trusts and private foundations, which are recognised in Switzerland.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How are these structures constituted and what are the main rules that govern them?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Family limited companies can be incorporated in different legal forms, most commonly as limited companies (SA). A limited company is established by its registration on the trade register. The shareholders\u2019 general meeting is the supreme power of the company. Members of the board of directors have several non-transferable powers, and they notably carry out senior management of the company. The auditor, an independent body, checks the accuracy of the annual accounts, provided that the company has not waived the restricted audit.<\/p>\n<p>Regarding the structures subject to foreign law, Swiss provisions refer to that law in relation to proper constitution and governance.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the registration requirements for these structures and what information needs to be made available to the relevant authorities? To what extent is that information publicly available?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Swiss regulations align with international standards on transparency and anti-money laundering. Notably, under the Swiss Financial Institutions Act, professional trustees must be licensed and meet regulatory standards including AML compliance, requiring the identification of the trust&#8217;s settlor, beneficiaries, and other relevant parties.<\/p>\n<p>However, much of the detailed information about beneficial ownership and financial activities is not publicly available and is primarily accessible only to relevant authorities for regulatory or law enforcement purposes.<\/p>\n<p>Where the assets of the trust are registered in the name of the trustee in the land register, reference to the trust relationship can be made by adding a mention. With regard to residential property, note should be taken of Switzerland\u2019s rules on the ownership of real estate by foreign persons (so called \u201cLex Koller\u201d), which may require for the trust instrument to be drafted to satisfy a number of requirements<\/p>\n<p>Swiss resident trustees may also be subject to reporting and \/ or registration requirements in other jurisdictions for example in the place of residence of a beneficiary or where trust assets are located.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How are such structures and their settlors, founders, trustees, directors and beneficiaries treated for tax purposes?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Foreign trusts are legally recognized in Switzerland but not treated as separate taxable entities; taxation depends on their classification. In settlor or beneficiary controlled trusts, assets and income are generally attributed in transparency to the settlor, or the beneficiary if the settlor has passed away or is not a beneficiary. In a revocable trust, assets and income are attributed in transparence to the settlor. In irrevocable and fully discretionary trusts, provided the settlor is not a beneficiary, income is typically taxed at beneficiary level upon distribution and assets are not subject to the beneficiary\u2019s wealth tax. In case of a fixed interest trust, distributions are taxed at the level of the beneficiary and the trust\u2019s assets are added to the beneficiary\u2019s taxable wealth.<\/p>\n<p>The trustee and the protectors, as well as directors acting in a trust company, are not impacted from a tax perspective.<\/p>\n<p>Family limited companies are taxed as separate legal entities. Shareholders are taxed on dividends (subject to partial taxation relief for qualifying participations) and the shares as well as the shareholder loan are subject to the wealth tax. Reimbursement of the shareholder loan is tax exempt. Directors and employees are taxed on remuneration and benefits in kind; hidden profit distributions may be recharacterized as taxable income. Across all structures, Swiss tax authorities apply look-through and recharacterization principles to prevent abuses.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are foreign trusts, private foundations, etc recognised?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As mentioned, there is currently no domestic law on trusts in Switzerland. However, Switzerland ratified the Hague Convention on the Law Applicable to Trusts and on their Recognition of 1 July 1985 with legal effect as of 1 July 2007. Foreign trusts properly constituted under the applicable law are thus recognised in Switzerland. Trust assets are civilly recognized as separate from the trustee\u2019s personal estate.<\/p>\n<p>In 2022, the Swiss Federal Government issued a proposition to provide for Swiss domestic regulation on trusts. The proposition was met with strong criticism notably in relation to tax aspects, leading the Swiss Federal Parliament to decide not to move forward with the proposed draft.<\/p>\n<p>Foreign private foundations are also recognized if validly constituted. Contributions to such entities from a Swiss tax resident may qualify as a donation to a non-related third party, subject to a maximum rate donation tax. Contributions to beneficiaries by liquidities or in kind are considered as taxable income.<\/p>\n<p>Where a structure is not recognized or is abusive, Swiss authorities may recharacterize it on a look through basis and tax the settlor or beneficiaries directly.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How are such foreign structures and their settlors, founders, trustees, directors and beneficiaries treated for tax purposes?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>See above answers to questions 25 and 26.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent can trusts, private foundations, etc be used to shelter assets from the creditors of a settlor or beneficiary of the structure?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p class=\"BodyText1\">As mentioned, the structures most commonly encountered are subject to foreign law. In principle, assets transferred into a trust are no longer owned by the settlor, provided the trust is properly established and managed according to its governing law.<\/p>\n<p class=\"BodyText1\">However, Swiss general rules on the protection of the rights of creditor also apply to transfers of assets to structures such as trusts or private foundations. Notably, fraudulent conveyance laws allow creditors to challenge an asset transfer that was made to evade their claims, or that renders the settlor insolvent or diminishes the creditors&#8217; ability to recover debts. If such a challenge is successful, the assets can be reclaimed for the benefit of creditors. Similarly, if a beneficiary has a right to the trust\u2019s assets or income, creditors may be able to claim those distributions once they are payable to the beneficiary.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What provision can be made to hold and manage assets for minor children and grandchildren?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In principle, parents are the legal representatives of their minor children and are responsible for managing their assets until they reach the age of majority (18 years old).<\/p>\n<p>Under Swiss inheritance law, testators (parents or grandparents) can make testamentary provisions for the benefit of minor children or grandchildren, subject to compliance with the compulsory portion. They can allocate funds or property to minors, designate a person or entity to manage the assets, and set out conditions for their use.<\/p>\n<p>Parents or grandparents can also designate minor children or grandchildren as the beneficiaries of a life insurance policy.<\/p>\n<p>Foreign structures such as trusts and family foundations are also often put in place for similar purposes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are individuals advised to create documents or take other steps in view of their possible mental incapacity and, if so, what are the main features of the advisable arrangements?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Swiss law, individuals are advised to take proactive steps to prepare for the possibility of future mental incapacity. Notably, the following arrangements can be considered:<\/p>\n<ul>\n<li>Advance Care Directive: individuals can establish an advance care directive to appoint someone to manage their personal, financial, and legal affairs in the event that they can no longer do so themselves due to incapacity.<\/li>\n<li>Living Will: individuals can specify their preferences for medical treatments and end-of-life care in case they become unable to make or communicate such decisions themselves. The individual may also designate a person who, in the event of incapacity, should discuss the medical procedures with the attending doctor and take decisions on his or her behalf.<\/li>\n<li>Lasting power of attorney: individuals may grant a power of attorney that continues to be valid even in the case of mental incapacity, if explicitly stated.<\/li>\n<li>Waiver of medical secrecy: in order to facilitate the decision making process in case of incapacity, individuals may waive in advance the medical secrecy in favour of the persons designated to take medical decisions in case of incapacity.<\/li>\n<\/ul>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What forms of charitable trust, charitable company, or philanthropic foundation are commonly established by individuals, and how is this done?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>A foundation is the most typical legal form for philanthropic purposes in Switzerland. It may be created by public deed or by disposition mortis causa.<\/p>\n<p>A foundation is established by dedicating assets to a specific purpose, which is fixed in its founding document. Tax-exempt status can be sought in case the foundation pursues public-benefit, charitable, or philanthropic goals. It acquires a distinct legal entity upon (mandatory) registration with the competent commercial register.<\/p>\n<p>Management is entrusted to a foundation board. The foundation\u2019s activities are subject to oversight by cantonal or federal supervisory authorities to ensure compliance with legal requirements.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What is the jurisdiction's approach to information sharing with other jurisdictions?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Switzerland applies a comprehensive and internationally aligned information-sharing framework. It participates in the OECD Common Reporting Standard (CRS) and exchanges financial account information automatically with a large number of partner jurisdictions on an annual basis. Switzerland also implements FATCA with the United States.<\/p>\n<p>In addition, Switzerland provides exchange of information on request and spontaneous exchange of information under its double taxation treaties and the OECD standard, including for tax rulings and cases of potential tax avoidance. Switzerland no longer accepts bank secrecy as a ground to refuse cooperation.<\/p>\n<p>Information obtained by Swiss tax authorities is exchanged subject to confidentiality, proportionality, and due process safeguards, but Switzerland is fully committed to international tax transparency and cooperation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What important legislative changes do you anticipate so far as they affect your advice to private clients?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Important reforms came into force on 1st January 2023 and 1st January 2025 concerning inheritance law and Swiss private international law relating to inheritance. The Federal Office of Justice is currently preparing a draft Bill to amend further provisions of inheritance law of the Swiss Civil Code, expected to be issued later in 2026. Other than these developments which should be followed closely, no material change is foreseeable in the next 5 years affecting private clients, subject to a change in the civil procedure concerning the fate of the children.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">5198<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/127372","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=127372"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}