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The Federal Council decided on March 11, 2022 that persons who have had to leave Ukraine because of the war will be granted protection status S in Switzerland. This gives refugees a quick and unbureaucratic right of residence in Switzerland without having to go through a regular asylum procedure and is valid initially for 1 year.
On 1st March 2022 the Swiss Parliament granted final approval for the new double taxation agreement for frontier workers (“the Agreement”) between Switzerland and Italy. With their approval Switzerland has completed the formal process to put the Agreement to a final vote. On the Italian side, similar steps are being taken. Provided both countries conclude the ratification process in 2022, the Agreement will be applicable as of 1st January 2023, leading to important changes for both Italian and Swiss cross-border commuters.
Deductible annual childcare costs for children under 14 will more than double from the current amount of CHF 10,100 to CHF 25,000 per child as of 1 January 2023 for Federal Direct Tax purposes. The conditions are that parents must be able to prove the costs and that they are in need of childcare (i.e. because they are working or studying).
Switzerland, by some referred to as “crypto nation”, already has non-profit foundations to house hundreds of millions of dollars crowdfunded by blockchain projects and the crypto foundations continue to thrive in Switzerland.
In December 2021, the Swiss Federal Tax Administration as well as the Association of Swiss Tax Administrations published their updated workpapers and guidelines on the taxation of crypto coins and projects. The new guidelines are based on real life cases that have been presented to and discussed with the authorities up to December 2020.
The OECD has published a new, updated version of the Transfer Pricing Guidelines, which now includes the updated guidance regarding possible approaches to apply to hard-to-value intangibles, the application of the transactional profit method and new guidance on financial transactions.
On 13 January 2022 the Swiss government has published the framework on how OECD’s Pillar 1 and 2 shall be implemented into national law.
Join our Global Workforce webinar on ‘The evolution of Global Mobility’ taking place on Tuesday 8 February 2022 from 08:30 to 10:00 CET. The webinar will provide insight into how Global Mobility programmes are transforming with the help of technology.
Good news! As of 1 January, reporting of deemed income for employees with company cars just became easier.
As of January 1, 2022, deemed income for personal use of a company car will be increased from 0.8% to 0.9% per month of the acquisition price of the car, excluding VAT. Employers will no longer need to declare the percentage of external service in the salary certificate and company car beneficiaries will not have additional taxable income added to their tax assessments over and beyond the 0.9%.
This change is basically good news for employers and employees alike since it will simplify payroll reporting and prevent surprises when receiving final tax assessments.
New webinar date - Practical implications on the Pillar 1 & 2 policy solutions developed by the OECD
The much anticipated, updated model rules relating to Pillar 2 have now been published by the OECD on Monday, 20 December. With this in mind, we are excited to announce that our Pillar 1 and Pillar 2 webinar will take place on Wednesday, 12 January from 16:00-17:30.
On 20 December 2021, the G20/OECD Inclusive Framework on BEPS ("inclusive framework") published Tax Challenges Arising from the Digitalisation of the Economy Global Anti-Base Erosion Model Rules (Pillar Two) ("model rules"). This follows on from the Statement on a Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy, agreed by more than 135 of its members on 8 October 2021.
Since 2017, the 141 member countries of the inclusive framework have developed a "two-pillar" approach to address the tax challenges arising from the digitalization of the economy: addressing nexus and profit allocation challenges ("Pillar One") and global minimum tax rules ("Pillar Two").
The long-awaited model rules provide more clarity on the future of a global minimum tax rate. Although the model rules have now been published and confirm the key parameters, further clarification on certain aspects is still required. Additional details shall be provided in a commentary that is expected to be published by the OECD by the end of January 2022.