Workshop by Thomas Jaussi and Markus Küpfer on the occasion of the ISIS) seminar on June 02 + 03, 2025 entitled "Update on withholding tax and stamp duties"
Note: This language version is an automatically generated translation. The text may therefore contain linguistic and terminological errors.
view in original language (German)Produktions AG is a company subject to unlimited tax liability in Switzerland. Within the global Bitterballen Group, it is responsible for the production of high-protein foods. Produktions AG is wholly owned by Beteiligungen AG, which is also subject to unlimited tax liability in Switzerland. Beteiligungen AG functions as a country holding company. Beteiligungen AG is in turn wholly owned by the Dutch company Bitterballen B.V., which is the top holding company of the Bitterballen Group.
An audit conducted by the Federal Tax Administration (FTA) regarding withholding tax and stamp duties in 2021 revealed that Produktions AG reported payroll expenses for an individual (Ms. Global) in its books, even though she did not work for Produktions AG at all, but rather for numerous other group companies within the Bitterballen Group, all of which were based outside Switzerland. The FTA estimated (in the absence of precise information from Produktions AG) the corresponding payroll expenses of Produktions AG for Ms. Global for the years 2016 through 2020 at a total of CHF 500,000. The FTA considered this to constitute monetary benefits provided by Produktions AG to the benefit of those group companies for which Ms. Global worked. This monetary benefit resulted in a withholding tax liability of CHF 175,000 (amounting to 35% of CHF 500,000).
Since Produktions AG wished to avoid the effort of allocating the individual tax claims to the various companies within the group that actually benefited from the services in connection with this monetary benefit, it calculated the withholding tax claimed by the FTA on a pro rata basis and transferred the amount of CHF 269,231.—. It also paid the late payment interest subsequently billed to Produktions AG by the FTA without reservation.
In 2023, following a renewed review of the facts examined by the FTA in 2021, Produktions AG concluded that the withholding tax it had declared and subsequently paid as of November 30, 2021, could have been settled through the reporting procedure. Ultimately, the Dutch company Bitterballen B.V. was the actual beneficiary in each case. Due to this circumstance, the withholding tax paid in 2021 was no longer owed retroactively, and the FTA was required to refund Produktions AG the “erroneously” paid withholding tax in the amount of CHF 269,231, together with the default interest paid and interest on the refund from the date the tax claim was transferred to the FTA, must be refunded. Should the FTA, contrary to expectations, insist on its withholding tax claim, Produktions AG further disputes the amount of the monetary consideration, which in fact was significantly lower than the CHF 500,000 billed by the FTA. However, Produktions AG did not submit any documents that could confirm this fact. Produktions AG thus filed a request for the notification procedure to be carried out and, in the event that its request was not granted, asked the FTA to issue a contestable decision. The FTA subsequently issued a formal decision in which it fully confirmed the monetary benefit of CHF 500,000. Produktions AG filed an objection against this decision.
Prior to issuing the decision on the objection, the FTA gave Produktions AG the opportunity to substantiate the amount of the monetary benefit. Produktions AG subsequently submitted only incomplete relevant records. Consequently, the FTA directly—that is, without first notifying Produktions AG—included statements of account that it had obtained in 2022 during administrative criminal proceedings against Produktions AG as part of an interrogation of a company officer acting as an informant. These statements show that Produktions AG’s expenses for the salary payments at issue here for the years 2016 through 2020 actually amounted to CHF 510,000.
Muster Holding AG is a domestic stock corporation currently with a share capital of CHF 10,000,000, divided into 10,000,000 shares at CHF 1 each. As the parent company (TopCo), Muster AG controls the Muster Group, which consists of approximately 20 operating subsidiaries in Switzerland and abroad. One such operating company is the domestic Muster Management AG, which provides services exclusively to the operating companies.
Muster Holding AG is owned by various shareholders. All shareholders are domestic legal entities with a capital share of at least ten percent. The following applies:
Pursuant to an existing shareholders’ agreement, CEO and CFO are each entitled to acquire 300,000 shares in Muster AG with a par value of CHF 1 at that value, although the market value per share is CHF 10. Under the agreement, CEO and CFO may exercise this right either personally or through CEO or CFO Holding AG, respectively.
In 2024, Muster Holding AG created 750,000 bonus shares with a par value of CHF 1.00 each, resulting in total share capital of CHF 750,000.00, by converting CHF 750,000.00 of tax-recognized capital contribution reserves into share capital. The CEO and CFO have now decided to acquire the 300,000 shares each to which they are entitled in Muster Holding AG at a purchase price of CHF 300,000 each through CEO Holding and CFO Holding, respectively.
The bonus shares were not capitalized at Muster Holding AG in accordance with commercial law; their creation was recorded as follows:
The current transfer or issuance of the 300,000 shares each to the CEO and CFO of Holding AG will be recorded as follows:
In summary, the structure and the planned transaction are as follows:
Muster AG was founded in the 1990s. Its shareholder, Mr. Muster, lives in Panama. Muster AG held various minority stakes in Mexican companies that operate gold mines. Between 2010 and 2013, these stakes were sold. As of December 31, 2013, Muster AG’s balance sheet was as follows (figures in CHF):
As of January 1, 2014, Muster AG provided liquidity to its shareholder based on a loan agreement. The loan was denominated in CHF and bore interest in accordance with the interest rates set by the FTA in its interest circular. At the beginning of 2021, the CHF loan was converted into a USD loan. Interest has been continuously capitalized since the loan was granted. At the end of 2023, the liquidation of Muster AG was resolved, and the company has since operated under the name Muster AG in Liquidation.
Mr. Treugut was the sole member of the Board of Directors of Muster AG with sole signing authority from the company’s founding; as of the end of 2023, he is registered in the Commercial Register as the liquidator. Following Mr. Treugut’s resignation as liquidator and member of the Board of Directors in October 2024, bankruptcy proceedings were initiated.
As of December 31, 2024, the balance sheet of Muster AG is as follows:
In January 2025, the FTA informs Mr. Treugut
