Key takeaways
- Swiss companies can deduct commercially justified expenses booked in their statutory accounts, including federal, cantonal and municipal income and capital taxes – a feature that lowers the effective rate (combined roughly 11.9%–21% depending on canton and municipality).
- Depreciation follows the Federal Tax Administration's safe-harbour rates, e.g. 40% declining balance (20% straight-line) for computers, software, vehicles and intangibles, 25% for office furniture, 4% for commercial buildings; some cantons allow immediate write-downs.
- Key limits: related-party interest must respect SFTA safe-harbour rates and thin-cap rules, donations are deductible up to 20% of net profit, punitive fines are not deductible, and losses carry forward 7 years – 10 years from 1 January 2028 for losses incurred from 2020 onwards.
Last reviewed: October 2026
Swiss corporate taxation rewards good documentation: deductions follow the statutory accounts, guided by safe-harbour rates from the Federal Tax Administration (SFTA). This guide summarises the rules for 2026, with the cantonal differences that matter for founders and foreign groups.
Swiss business deductions – key figures (2026)
| Item | Rule |
|---|---|
| Computer hardware/software, vehicles, intangibles | 40% declining balance / 20% straight-line |
| Office furniture and equipment | 25% / 12.5% |
| Commercial buildings | 4% / 2% (with land: 3% / 1.5%) |
| Acquired goodwill | Generally amortised over 5 years |
| Taxes | Income and capital taxes deductible (not Swiss QDMTT/IIR top-up tax) |
| Donations | Up to 20% of net profit (federal) |
| Bad-debt provision | Lump-sum 5% domestic / 10% foreign receivables (Zurich: 10%/20%) |
| Losses | 7-year carry-forward; 10 years from 1 January 2028 for losses from 2020 (Federal Council decision, September 2026) |
| R&D super-deduction | Up to 50% extra in many cantons |
What can a Swiss company deduct?
- Operating costs that are commercially justified and booked in the accounts: salaries, social security, rent, professional fees, travel, marketing.
- Depreciation within SFTA safe-harbour rates (higher if justified by statutory accounting; some cantons allow immediate write-offs).
- Taxes: federal, cantonal and municipal income and capital taxes and indirect taxes like real estate transfer tax.
- Related-party charges at arm's length: royalties, management and service fees.
- Interest at arm's-length rates; for related-party loans the SFTA publishes annual safe-harbour rates (e.g. 2.00%–2.50% for other CHF loans from related parties in 2025, more for small operational loans) and thin-cap rules apply.
- Employee share plans for Swiss-employed staff and training costs.
- Provisions: lump-sum bad-debt provisions and inventory reserves of up to one-third (cantonal rules).
What is not deductible?
- Punitive fines and administrative sanctions (fines that merely skim profits can be deductible);
- the Swiss QDMTT and IIR top-up taxes under the minimum tax ordinance;
- excessive related-party interest (hidden equity) and non-arm's-length payments to shareholders (constructive dividends);
- private expenses of shareholders.
Example: A Zug-based SaaS company buys servers for CHF 100,000. It can depreciate them at 40% declining balance – CHF 40,000 in year 1 – and deduct the cantonal and federal taxes it pays, lowering the combined effective rate to around 11.8%–12% in Zug.
Cantonal incentives worth knowing
- R&D super-deduction: up to 50% additional deduction on qualifying Swiss R&D personnel and contracted R&D costs.
- Patent box: reduced taxation of qualifying IP income at cantonal level.
- Notional interest deduction on excess equity – only in the canton of Zurich.
Frequently asked questions
Are taxes deductible for Swiss companies?
Yes. Federal, cantonal and municipal income and capital taxes are deductible business expenses in Switzerland, which is why effective rates are lower than statutory rates. The Swiss QDMTT and IIR top-up taxes are not deductible.
What depreciation rates apply in Switzerland?
SFTA safe-harbour rates: 40% declining balance (20% straight-line) for IT, vehicles and intangibles, 25% for office furniture, 4% for commercial buildings. Higher rates are possible if justified by statutory accounting.
How long can losses be carried forward in Switzerland?
Seven years currently. From 1 January 2028, losses incurred from 2020 onwards can be carried forward for ten years (date set by the Federal Council in September 2026). There is no carry-back.
Are donations deductible in Switzerland?
Yes, up to 20% of net profit for contributions to qualifying charitable or public-welfare entities and Swiss public bodies.
Related guides
- How to obtain tax residency in Switzerland
- Tax incentives for expats in Switzerland
- Business expenses in Austria
Sources
- PwC Worldwide Tax Summaries – Switzerland: Corporate deductions
- Swiss Federal Tax Administration (estv.admin.ch) – depreciation and safe-harbour interest rate circulars
This guide is general information, not personalised tax advice.
Setting up in Switzerland? Get a personalised canton and structuring comparison with Heavnn → heavnn.io
