Switzerland Crypto Tax 2024
In 2024, Switzerland continues to strengthen its reputation as one of the most attractive and cryptocurrency-friendly jurisdictions in the world. The country is known for its innovative approaches to regulating financial technologies, including cryptocurrencies, and offers a detailed tax system for transactions with digital assets. In this article, we will look at the key aspects of cryptocurrency taxation in Switzerland in 2024.
Regulation and Tax Policy
Switzerland is not only actively developing the legislative framework for regulating cryptocurrencies, but also strives to create favourable conditions for the development of the crypto industry. Cryptocurrency regulation is carried out at the federal level, and tax policy regarding cryptocurrencies is developed by the Federal Tax Administration (FTA).
Taxation of Cryptocurrencies
In Switzerland, cryptocurrencies are recognized as assets (property), which means that their owners are required to declare cryptocurrency assets on their tax return. Tax rates and requirements may vary by canton, but there are nationwide tax principles:
- Capital gains for retail investors are generally tax-free if cryptocurrencies are held as a personal investment for the long term.
- Professional cryptocurrency traders may face taxation of their capital gains as business income.
- Mining and staking income is generally considered a self-employment activity and is subject to income tax.
Value Added Tax (VAT)
An important aspect of taxation is VAT. In Switzerland, transactions with cryptocurrency that qualify as the provision of financial services are exempt from VAT. This exemption makes Switzerland an attractive location for cryptocurrency companies.
Tax Incentives and Benefits
Switzerland offers various tax incentives for the crypto industry, including preferential tax regimes in some cantons, such as Zug, known as the “Crypto Valley”. These incentives are intended to attract cryptocurrency startups and investment into the country.
Conclusion
In 2024, Switzerland continues to confirm its status as one of the leaders in the field of cryptocurrency regulation and taxation. The country offers a clear and progressive tax policy for cryptocurrencies, promoting the development of innovative technologies and attracting cryptocurrency companies and investors from all over the world. Switzerland remains an example of how a state can simultaneously provide regulatory clarity and support the development of new financial technologies.
How do I pay taxes on crypto in Switzerland in 2024?
In Switzerland, known for its progressive approach to regulating financial technology and cryptocurrencies, the taxation of cryptocurrency
income reflects the country’s commitment to supporting innovation while ensuring fair taxation. In 2024, certain rules and obligations apply to taxpayers with cryptocurrency income, which are important to consider in order to comply with Swiss tax law.
Basics of Cryptocurrency Taxation in Switzerland
In Switzerland, cryptocurrencies are recognised as assets, which means that any income from their sale, exchange or use as payment is taxable. Depending on the canton in which the taxpayer resides, there may be some differences in the approach to taxation.
Declaration of Income
- Capital gains: Gains from the sale of cryptocurrency are generally considered capital gains and are taxable if the seller is a professional cryptocurrency trader. For private investors, capital gains are often not taxable.
- Income from mining and steaking: It is considered professional income and is subject to taxation in accordance with the taxpayer’s general tax rate.
- Salary in cryptocurrency: Must be shown on the tax return as equivalent in Swiss francs (CHF) at the time of receipt.
Accounting for Cryptocurrency in Tax Returns
Cryptocurrency assets should also be reported in the tax return as part of the taxpayer’s overall wealth. The assets should be valued at the exchange rate at the end of the tax period.
Tax Rates and Contributions
Tax rates in Switzerland vary depending on the canton of residence and the total income of the taxpayer. It is important to note that in addition to the federal tax, cantonal and municipal taxes may apply.
Planning and Optimisation
- Proper Declaration: It is important to accurately track all cryptocurrency transactions for proper declaration of income and assets.
- Consultations with Experts: Given the complexity of tax legislation, consultation with tax advisors is recommended to optimise tax liabilities.
Conclusion
The taxation of cryptocurrency income in Switzerland requires careful accounting and declaration by taxpayers. Switzerland continues to be one of the most attractive jurisdictions for cryptocurrency businesses due to its balanced and innovative approach to regulating this area.
Table with the main tax rates in Switzerland:
| Type of tax | Tax rate |
| Federal income tax | Progressive up to 11.5% |
| Cantonal and municipal tax | Varies depending on the canton |
| Corporate income tax | 8.5% (federal level) + cantonal rates |
| VAT | 7.7% (standard rate), 3.7% and 2.5% (preferential rates) |
| Capital tax | Varies depending on the canton |
These rates reflect the diversity of the Swiss tax system, where tax rates can vary significantly depending on the canton of residence. Federal taxes are more standardised across the country, while cantonal and municipal taxes provide a significant degree of local autonomy.
Also, lawyers fromRegulated United Europe provide legal services for obtaining a crypto license.
FREQUENTLY ASKED QUESTIONS
Is Switzerland a good place to start a cryptocurrency business?
A global hub for future-oriented DLT business technologies is emerging in Switzerland, which is home to the famous Crypto Valley. Positive government policies, favorable legislation, and a fair and effective taxation system attract crypto companies. Swiss taxpayers can also protect their tax revenues in two countries because Switzerland has double taxation agreements with around 100 countries. Also, they can reduce import taxes in some cases and eliminate double taxation on wealth, inheritance, and inheritance.
In Switzerland, who is responsible for taxation?
It is generally the Federal Tax Office (FTA), the cantons, and municipalities that administer Swiss taxation. You will find different tax rates depending on the location you choose for your crypto company, since each canton has a different tax framework. Timing, however, remains almost unchanged – in Switzerland, tax returns must be submitted before 31 March, and the tax year corresponds to the calendar year. In terms of taxation, cryptocurrencies are treated as assets rather than fiat money, making them similar to financial securities (e.g. equities or bonds).
How can cryptocurrencies be classified?
In accordance with FINMA guidance, the FTA categorizes cryptocurrencies into the following categories:
- A native cryptocurrency such as Ether or Bitcoin (used for electronic payments)
- In addition to asset-backed tokens, there are subcategories of asset-backed tokens (used for raising funds and granting rights to holders, such as voting)
- Tokens that require a repayment of the investment and interest payments from the issuer
- Holders of equity tokens are entitled to receive a cash payment based on a certain ratio to profit or liquidation result, but the issuer is not obligated to repay their investment
- Holders of participation tokens are entitled to a proportional share of the issuer’s reference value (e.g. sales), rather than being obligated to repay the investment.
- In the case of a company’s success, utility tokens do not grant the holder pecuniary benefits, but a right to use digital services.
How much does Switzerland's tax rate cost?
The following taxes may be applied at the federal, cantonal, or communal levels to companies engaging in activities related to the above-mentioned crypto categories:
- The corporate income tax rate is between 12% and 21%
- It is taxed at a rate of 0.001%-0.5% on capital gains
- Value Added Tax (VAT) – 7.7%
- Withholding Tax (WHT) – 35%
- Social Security Contributions – 0.5%-5.3%
- Issuance Stamp Duty – 1%
Does corporate income tax come in different forms?
The Corporate Income Tax is composed of the following elements, according to Swiss tax laws:
- Corporations are subject to federal income tax
- Corporations are subject to a cantonal income tax
- Corporations are subject to a communal income tax
Net profits of corporations are taxed at 8.5% by the federal government. There are many differences between cantonal and communal corporate income taxes since each canton has a different tax system. You can request personalized advice from the Regulated United Europe (RUE) team if you want to know which Swiss location would be best for your crypto business.
Do crypto businesses in Switzerland have to pay VAT?
In terms of VAT, native token transactions, including exchanges, are not subject to VAT since native tokens qualify as a means of payment. Generally, commissions or fees associated with such transactions are VAT exempt without credit because they are fees for financial services. Other categories of cryptocurrencies, however, may be subject to VAT due to their different functions and purposes of use (e.g. providing a particular service).
In the Crypto Valley, what are the tax rates?
It is based in Zug, where there are attractive tax rates and a regulatory framework that is supportive of the cryptocurrency-related business community, making it one of the most mature and largest DLT ecosystems.
The following aspects should be considered by crypto companies planning to operate in Crypto Valley:
- Native token transactions (e.g. Bitcoin) are not subject to VAT.
- There is a proportional corporate income tax (up to 15.1%).
- A salary statement must reflect the income tax (approx. 23%) applicable to cryptocurrency salaries
- Cryptocurrencies can be used for tax payments
Are there any plans to tax net wealth?
Taxes based on market value are a common cantonal tax imposed on cryptocurrencies, such as the Net Wealth Tax. There are major differences between cantons due to their local rates and collection systems. Tax bands are determined by factors such as residence permit type, marital status, and annual income, for example, in Zurich. A single taxpayer who earns less than 77,000 CHF (approx. 77,800 EUR) is not subject to paying the tax, but can be required to pay up to 5,584 CHF (approx. 5,640 EUR) if their income exceeds 3,158,000 CHF (approx. 3,191,000 EUR). For married couples, the thresholds are slightly higher.
Can you tell me what the capital gains tax rate is?
Capital Gains Tax is imposed on profits from selling or trading crypto by self-employed crypto traders and businesses at a rate of up to 7.8%. Personal wealth assets are exempt from the tax.
What advancements will be made in the near future?
The Swiss government is obligated to transpose OECD recommendations and policies into Swiss law, since Switzerland is an OECD member. A new international tax transparency framework, known as Crypto-Asset Reporting Framework (CARF), has recently been introduced by the OECD to reduce inconsistencies and administrative silos associated with crypto-related taxation and tax reporting. To deal with the rapid adoption of cryptocurrencies, the OECD essentially proposes that international tax authorities share information on taxpayers and automatic tax reporting to be implemented.
