Key facts
Withholding tax is intended to curb tax evasion. If the conditions are met, a refund is possible. In the case of individuals resident abroad, a non-refundable portion may remain, depending on the relevant double taxation agreement There are two ways to fulfil the obligation to pay withholding tax. Firstly, by means of payment, i.e. payment with subsequent refund by the Federal Tax Administration (FTA). Secondly, simply by means of a notification, which must be authorised by the FTA. The majority of withholding tax is currently processed via the notification procedure and therefore without a cash flow. In 2023, receipts from withholding tax totalled CHF 6.4 billion.
The Swiss Federal Audit Office (SFAO) audited the effectiveness of the fight against fraud and irregularities. It recognised potential for further development in the risk analysis for on-site checks. The physical and digital submission of forms leads to inefficiencies. Efforts should be made to increase digitalisation.