- The Federal Administrative Court confirmed the Swiss Federal Tax Administration’s (ESTV) practice regarding input tax deduction for holding companies but criticized the use of the turnover key. The court agreed that input tax deductions related to holdings must be considered within the context of the entire business activity, not isolated. However, it found the turnover key inappropriate as it doesn’t account for dividends and participation income, leading to distortions. The case was sent back to ESTV to determine a more appropriate method, possibly using the balance sheet structure.
Source: primetax.ch
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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