Mandatory tax liability for mail order companies in Switzerland

If a foreign mail order company generates a turnover of at least CHF 100,000 per year from small consignments (goods value less than CHF 62 at a tax rate of 8.1% or CHF 193 at a tax rate of 2.6%) that it transports or dispatches from abroad to Switzerland, its deliveries are deemed to be domestic deliveries. As a result, he becomes liable for VAT in Switzerland and must be entered in the VAT register. The tax liability arises the month after the turnover limit of CHF 100,000 is reached.

Voluntary tax liability for mail order companies in Switzerland

If a foreign mail order company in Switzerland is not entered in the Swiss VAT register and does not have a declaration of subordination abroad and sends goods to Switzerland, the Swiss customer normally acts as the formal importer. This means that the customer must pay the VAT levied at customs and any customs duties and customs clearance fees themselves and receives an invoice from the transport company. This can lead to a customer in Switzerland refraining from placing an order due to these additional costs, which cannot be estimated by the average consumer. With voluntary VAT registration, the foreign mail order company can take over the import process and VAT invoicing for the customer and ensure that no unexpected costs arise for the customer. The foreign mail order company sells its goods including the VAT owed. The Swiss customer can be shown the final purchase price including VAT and delivery costs in the online shop. This gives the Swiss customer the necessary cost certainty. This makes the offer more transparent and attractive, which can lead to higher sales figures.