"Structure follows strategy" in corporate succession - insights from the SIX Swiss Exchange Family Business Conference 2023
"Structure follows strategy" is a conclusion of the American business historian Alfred D. Chandler, which states that the strategy should be defined first and then a structure that leads to the realization of the strategy. This principle is often not sufficiently taken into account in corporate succession and the focus is prematurely placed on implementation and structuring issues. The topics discussed at this year's SIX Swiss Exchange Family Business Conference are set out below against this background.
Succession planning: tax pitfalls
When Swiss families think about the organization of their estate, they generally do not pursue any immediate tax objectives. In general, it is more a question of transferring assets to the next generation or at least initiating the future reorganization of ownership structures in the present. Of course, reducing wealth tax and breaking the tax progression, for example, can be an accompanying motive, but practice shows that this is rarely the actual "trigger". This article presents some typical questions.
The tax treatment of (underpriced) non-family business succession with special consideration of Ticino practice
Does an underpriced transfer of shares to an employee always lead to income tax consequences? With this article, the authors want to stimulate discussion on a very relevant aspect of non-family business succession: the distinction between (income taxable) employee shareholdings and (possibly non-income taxable) succession arrangements. The authors take a look at the practice and case law in the canton of Ticino and other cantons as well as the possible effects of recent inheritance law reforms.
Tax aspects of family business succession
In the coming years, many small and medium-sized companies will face the challenge of arranging their succession. A transfer against payment or free of charge may be considered in order to remain in family ownership. The planning and implementation of succession is an important topic for entrepreneurs with links to numerous areas of law. This article is dedicated to the tax challenges and solution strategies in family business succession in order to support companies in strategically well thought-out and tax-optimized planning.
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Greater fiscal consideration of the costs of third party childcare
The Economic Commission of the National Council has accepted without opposition the Federal Council's Dispatch 18.050 concerning the tax recognition of third-party childcare costs. This proposal is related to the initiative for skilled workers and is intended to promote the employment of women. The Commission considers that taxing the cost of external care can be an argument for women wishing to enter the labour market, as the cost of care is too high for many young families. In the overall vote, the Commission approved the unchanged proposal by 11 votes to 8 with 5 abstentions. However, a minority of the Commission wishes to limit the deduction to the proven costs of institutional provision of childcare outside the family (rejected by 18 votes to 5), while a second minority demands a deduction not only for third-party but also for self-care of children (rejected by 13 votes to 10). The transaction is expected to be dealt with in the spring session 2019.
Marriage penalty: External expert recommends a broader data basis for the FTA
The statistical basis for direct federal tax, on which the Federal Tax Administration (FTA) can draw, is insufficient. Therefore, especially the estimation of the number of persons affected by the marriage penalty remains subject to uncertainty. This is the conclusion of an external report commissioned by the Federal Department of Finance (FDF), the results of which were presented to the Federal Council at its meeting on 7 November 2018.
Remuneration interest rate for direct federal tax remains the same
The Federal Department of Finance (FDF) has decided to continue not to pay any refund interest for the calendar year 2019 on amounts of direct federal tax paid early.
National Council maintains mandate for tax deductions
The National Council insists that the Federal Council implement an adopted motion on the taxation of foreigners. On 27 September 2018 he refused to write them off.
Harmonisation of interest rates for federal tax exemptions
On 10 September 2018, the Council of States adopted the motion "Harmonisation of interest rates in federal tax decrees" with the following amendment: "The Federal Council is instructed to harmonise interest rates in federal tax decrees in such a way that a generally applicable default and refund interest rate is established".
Stop the tax penalty in pillar 3b. Tax the income share instead of the capital contribution in the case of a capital withdrawal
On 10 September 2018, the Council of States adopted the motion "Stop the tax penalty in pillar 3b. In the case of a capital withdrawal, tax the share of income instead of the capital contribution" with the following amendment: "The Federal Council is instructed to submit to parliament an amendment to the Federal Tax Act (DBG) and the Tax Harmonisation Act (StHG) in order to achieve a flexibilisation of the flat-rate share of income on all benefits (periodic benefits, surrender, refund) from life annuities and life insurance policies, adapted to the respective investment conditions.
WAK-S has defined key points for the system change in the taxation of residential property
After detailed discussion and extensive clarifications, the WAK-S decided how the system change in imputed rental value should be implemented and commissioned the administration and secretariat to prepare a preliminary draft.
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ISIS) seminar folder "Structuring of private assets by means of trusts or foundations" (2023)
Case studies, detailed solution notes and slides: Here you will receive all documents of the individual workshops according to the following content description from the ISIS)-Seminar "Structuring of private assets by means of trusts or foundations" of October 31, 2023 under the direction of Peter Mäusli-Allenspach.
Charitable foundations and corporate foundations
Workshop on "Charitable Foundations and Corporate Foundations" by Julia von Ah and Oliver Appenzeller on the occasion of the ISIS seminar "Structuring Private Assets by Means of Trusts or Foundations" on October 31, 2023.
