In the Land of Banking and Finance: VAT Recovery in Switzerland

With a population of just over eight million people, Switzerland is a landlocked country in Central Europe.  Known for its heart-racing ski resorts, picturesque villages, and world-famous chocolates, the Swiss hotel industry recorded 18.4 million overnight stays in Switzerland in the first half of 2018.

Banking and finance are key industries in Switzerland, and while the majority of foreign travel to Switzerland is for holidays and recreation, it’s interesting to note that business trips account for 6 % of trips.

Every year Switzerland hosts an array of major international events, such as the World Economic Forum in Davos, Art Basel and the athletics meeting Weltklasse Zurich.  Thousands of business travelers descend on the country every year, but many miss out on the opportunity to reclaim their VAT.  The minimum VAT amount per year for a refund in Switzerland is only CHF 500, and can be recovered for expenses on Trains and Buses, Shuttles, Taxis, Telephone, Internet, Fuel, Car Rental, Parking, Conferences, DDP, Laundry, Tolls, Electronics, Groceries, Hotels and Accommodation, and Restaurants.

The Swiss Franc is the nation’s currency and Switzerland’s VAT rates are as follows:

  • Standard Rate of 8%
  • Reduced Rates of 3.8% and 2.5%

While Switzerland is a founding member of the European Free Trade Association, the country is not part of the EU, the European Economic Area or the Eurozone. It does participate in the Schengen Area and the European Single Market, through bilateral treaties.

A Swiss-established fiscal representative must be appointed for a business to apply for a VAT refund.  Since Switzerland is not a member of the EU, the EU Directive 2006/09/EC and the 13th Directive are not applicable to foreign domicile companies requesting VAT refunds in Switzerland. However, it is possible for foreign-domiciled companies to reclaim VAT in Switzerland via a “13th Directive equivalent legislation”.

Although English is widely spoken, the official languages in Switzerland are German, French, and Italian.  When traveling for business it’s important to know the local terms to make sure you get the information you need to reclaim your VAT:

English
Please give me:

  • An original VAT invoice
  • With my company name and address
  • VAT rate and value shown

Swiss German:
Bitte gib mir:

  • eine originale Rechnung mit ausgewiesener Mehrwertsteuer
  • Mit meinem Firmennamen und meiner Adresse
  • MwSt.-Satz und Wert angezeigt

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