Workshop by Ruth Bloch-Riemer and Toni Hess on the occasion of the ISIS) seminar on May 5, 2025 entitled "Appeal procedures taking into account intercantonal and international aspects (2 parts)"
Note: This language version is an automatically generated translation. The text may therefore contain linguistic and terminological errors.
view in original language (German)A is the sole shareholder of the domestic company X. AG (operational). He resides in Zurich. X. AG is headquartered in Zug.
By order dated September 23, 2021, A is required to pay back taxes and penalty taxes relating to state and municipal taxes of the Canton of Zurich and direct federal tax for the tax periods 2013–2018. The 30-day objection period expired without being utilized. On February 5, 2022, shortly after the pandemic-related mandatory work-from-home requirement was converted into a work-from-home recommendation, A submitted a request for reinstatement of the objection period.
A is represented in tax matters by his trustee, B.
All correspondence regarding tax matters is sent to trustee B; A himself no longer receives any mail from the tax office. The decision in the back-tax and penalty proceedings was therefore sent to B. Since August 2021, B had been in COVID-19 quarantine on the recommendation of Inselspital Bern, as she belongs to a high-risk group. For this reason, it was impossible for her to access the files in time and to contact the taxpayer A. Transferring the case to another trustee was ruled out due to time constraints and the complexity of the case. Restoration of the appeal period is requested.
A did not file any tax returns for the 2015–2017 tax periods. With regard to direct federal tax, he was imposed an administrative fine by decisions dated 2017 (tax period 2015) and 2018 (tax period 2016) for violating procedural obligations by failing to file a tax return (Art. 174(1)(a) DBG). A filed an objection against both decisions in September 2019. In medical certificates dated August 2019 and February 2020, A was classified as 100% unable to work for the period from September 2016 to August 2019 due to obsessive-compulsive disorder and depression. In November 2018, A filed an objection within the prescribed time limit against the discretionary assessment for the 2015 tax period. A requests reinstatement of the deadline.
The married couple AD (hereinafter AD) moved their residence from Zurich to Graubünden at the end of 2017. Consequently, they were taxed for the tax periods 2017 through 2020 with Graubünden as their primary tax domicile. These assessment decisions became final and uncontested. In the Canton of ZH, they had limited tax liability for these tax periods due to ownership of real property.
For the 2021 tax period, they were assessed by the Canton of Graubünden via assessment decisions dated January 17, 2023. These decisions did* not* initially become final (for other reasons—the granting of certain deductions was still in dispute); they ultimately became final on March 5, 2024 (Graubünden = canton of initial assessment).
In a letter dated April 28, 2023, the Tax Office of the Canton of ZH requested that the married couple AD submit documents for the purpose of reviewing their unlimited tax liability for the year 2021. They complied with this request in a letter dated May 15, 2023.
On July 12, 2023, the Tax Office of the Canton of ZH issued a proposed assessment to AD for the 2021 tax period. It stated that the primary tax domicile was in ZH and that the AD couple were subject to unlimited tax liability in the Canton of ZH starting with the 2021 tax period. In a letter dated July 27, 2023, the ADs objected to unlimited tax liability in ZH, explaining the differences in electricity and water consumption.
On February 28, 2024, the Tax Office of the Canton of ZH issued the 2021 assessment decisions. These decisions confirmed the primary tax domicile and the unlimited tax liability in the Canton of ZH. These decisions became final (Zurich = second-assessing canton).
On April 2, 2024, Mr. and Mrs. AD requested the Tax Administration of the Canton of GR to review the assessment decisions of January 17, 2023, regarding the direct federal tax as well as the cantonal and municipal taxes for 2021. They justified their request as follows: The Canton of ZH had determined that, starting in 2021, their primary tax domicile was in ZH. Furthermore, in cases of double taxation, a request for review is permissible even without an explicit ground for review in tax law.
The Canton of GR does not recognize the institution of review for intercantonal double taxation conflicts.
Mr. and Mrs. AB (hereinafter AB) resided in the Canton of Bern and were subject to unlimited tax liability there. A worked at Federal Office C starting in 2001. As of July 1, 2016, he was seconded to Luxembourg for a limited period (two years) to represent Switzerland at Office D. The City of Bern Tax Administration registered AB’s departure as of June 30, 2016. From that date onward, A was no longer taxed in Switzerland, while B was subject to withholding tax due to her part-time work in Switzerland. The assessment decisions for the 2016 tax year became final.
The couple AB kept their rental apartment in Bern, which they had been renting since 2006. Their two adult sons lived in this apartment from time to time. B also stayed there regularly (on Mondays, Tuesdays, and Wednesdays) to carry out her part-time work. Whenever possible, B took the train on Thursday afternoons to visit A in Luxembourg and returned to Switzerland on Monday. She spent the majority of her weekends in Luxembourg, though she spent one weekend every four to five weeks in Bern.
With a view to a future return to Switzerland, the couple maintained bank and postal accounts in Switzerland. They also visited their dentist and doctor in Bern. Every two months, they attended family events in Switzerland. In Luxembourg, however, they also regularly hosted visits from friends from Switzerland.
In 2018, the Tax Administration of the Canton of Bern initiated proceedings to determine the tax residence of the AB couple for the year 2017. In a decision dated January 14, 2019, it determined that Bern remained the tax residence of the AB couple. The appeals filed against this decision were unsuccessful, and the Administrative Court of the Canton of Bern upheld the assessment.
Mr. and Mrs. AB filed a complaint in public law matters with the Federal Supreme Court, requesting that the Administrative Court’s judgment be set aside and that the Canton of Bern be denied the right to tax for the year 2017.
