Glossary

The words you come across in To Bill, explained in one or two sentences. The terms are in alphabetical order.

A

Accident insurance (UVG), supplementary accident insurance and daily sickness allowance insurance (KTG). Compulsory accident insurance (UVG), supplementary accident insurance and insurance paying daily allowances in case of sickness (KTG), whose premiums may partly be deducted from the salary. See Insurance.

Acquisition tax. The VAT due on a service bought from a foreign company that is not registered in Switzerland, for example consulting or advertising (Art. 45 VAT Act). See Acquisition tax.

Agreed consideration, consideration received. The two ways of accounting for VAT: on invoicing (agreed consideration, the rule) or on payment (consideration received, with the FTA’s authorisation). Art. 39 VAT Act.

B

Balance sheet. A snapshot of the company on a given date: what it owns (assets) and what it owes (liabilities and equity). See The balance sheet and the income statement.

Bank reconciliation. Linking each movement on your bank statement to the invoice, expense or entry it corresponds to. See Reconcile payments.

C

camt.053, camt.054. The electronic files your bank provides: camt.053 is the account statement, camt.054 the credit advice for payments received. To Bill reads them to record your payments. See Import a bank statement.

Chart of accounts. The numbered list of the company’s accounts. To Bill uses the Swiss SME chart of accounts. See The chart of accounts.

Collection. A payment received from a client, recorded on their invoice. See Collections.

Credit note. The document that cancels all or part of an invoice, for example after a mistake or a discount. See Credit notes.

D

Default. The situation of a debtor who is late: as a rule after a reminder, or from the due date if the payment date was agreed (Art. 102 CO). From the moment of default, default interest can be claimed.

Default interest. The late-payment interest owed by a client in default: 5% a year, even if the contract provides for less; a higher rate agreed in the contract also applies (Art. 104 CO).

Depreciation. The loss in value of a durable asset (machine, vehicle, computer), posted each year as an expense. See Manage your fixed assets and their depreciation.

E

eCH-0217. The official file format of the VAT return, which you import on the FTA Portal instead of copying the figures. See Upload the VAT return to the FTA Portal.

Entry. A record in the books: an amount debited to one account and credited to another, with its date and its voucher. See The journal and entries.

F

Family allowances. Amounts paid for employees’ children, financed mainly by an employer contribution to a family allowance fund.

Fiduciary. The firm that keeps or checks a company’s accounting, payroll and taxes. In To Bill, it works from its cockpit. See The fiduciary cockpit.

Financial year. The accounting period, usually the calendar year. A company’s first financial year can be shorter or longer.

Fixed asset. An asset the company keeps for several years (machine, vehicle, furniture) and that is depreciated. See Manage your fixed assets and their depreciation.

FTA (Swiss Federal Tax Administration). The federal administration that collects VAT and withholding tax. Direct federal tax is assessed and collected by the cantons; the FTA supervises how it is applied (Art. 2 and 102 of the Federal Act on Direct Federal Taxation, DBG, German version). You file your VAT return with the FTA.

Full books. Double-entry bookkeeping, with a balance sheet and an income statement. It is compulsory for legal entities (limited companies, GmbHs, cooperatives…) and for sole proprietorships and partnerships whose turnover in the last financial year exceeded CHF 500’000 (Art. 957 para. 1 CO). Below this threshold, simplified books are enough (Art. 957 para. 2 CO).

G–H

General ledger. All the entries of an account, in date order, with its balance.

I

IBAN, QR-IBAN. The IBAN identifies your bank account (21 characters in Switzerland, starting with CH). The QR-IBAN is a special number the bank gives you in addition to the usual IBAN: it is only used for QR-bills with a QR reference, in francs only. You do not need to know which one you have: To Bill recognises it by itself when you paste the IBAN. See The QR-bill.

Income statement. The income and expenses of a period, and the resulting profit or loss.

Input tax. The VAT you have paid on your purchases and deduct from the VAT due on your sales (Art. 28 VAT Act).

Instalment. Part of the price invoiced before the work is finished. In To Bill, an invoice can be paid in several instalments (Installment in the invoice editor), each with its own QR-bill. See Payment in instalments.

J–L

Journal. The list of all entries, in chronological order. In To Bill, each entry is protected by a fingerprint that makes any change visible.

M–N

Net tax rate (NTR). A simplified VAT accounting method for small businesses: a rate set by the FTA for each sector is applied to turnover including VAT, without deducting input tax (Art. 37 VAT Act).

Notes. The document that accompanies the balance sheet and the income statement in the annual accounts: it explains the principles followed and gives the information required by law (Art. 959c CO). See The notes to the annual accounts.

O

OASI / DI / EO. The basic social insurances: old-age and survivors’ insurance (AHV), disability insurance (IV), loss of earnings compensation (military service, maternity). Their contributions are deducted from every salary, half paid by the employee, half by the employer.

Occupational pension (BVG, 2nd pillar). The employer and the employee contribute to a pension fund, above a minimum salary set by the Confederation.

Opening balance. The balances of the accounts on the first day To Bill keeps your books, taken from your fiduciary’s last balance sheet.

P

pain.001. The payment file you import into your e-banking to pay your suppliers or your salaries in one go. See Pay by payment file (pain.001).

Profit appropriation. The meeting’s decision on the year’s profit: statutory reserve, dividend, amount carried forward. See Have the profit appropriation decided.

Q

QR-bill. The Swiss payment slip, with a QR code the client scans in their bank’s app. To Bill prints it on the last page of your invoices in francs and in euros. See The QR-bill.

QR reference, creditor reference (RF). The number that accompanies a payment and identifies the invoice paid: 27 digits for the QR reference (on a QR account), or a payment reference starting with RF (the ISO 11649 Creditor Reference, “SCOR”) on an ordinary IBAN. To Bill chooses the right one from the IBAN you enter, and so reconciles payments by itself.

Quote. A price offer you send to a client before the work. Once accepted, it is turned into an invoice. See Quotes.

R

Receivable. What a client owes you. A receivable becomes an unpaid invoice when the due date has passed.

Registered for VAT (VAT liable). A company entered in the VAT register. It charges VAT to its clients and pays it over to the FTA. Registration is compulsory from CHF 100’000 of annual turnover (Art. 10 VAT Act).

Reminder. The message sent to a client who has not paid by the due date. To Bill offers three levels: Payment reminder (“Friendly reminder” in the settings), Formal reminder and Final notice. See Reminders.

Reversal. The opposite entry that cancels a wrong entry. An entry is not deleted: it is corrected by a reversal.

S

Salary certificate. Form 11, which the employer gives each employee at the end of the year for their tax return. See The salary certificate.

Simplified books. Bookkeeping of income, expenses and assets, allowed for small sole proprietorships and partnerships and for associations (Art. 957 para. 2 CO). See Simplified books.

Statutory retained earnings. The share of profit a limited company or a GmbH must set aside: 5% of the profit, until the statutory reserves reach half of the capital (Art. 672 and 801 CO).

Swissdec. The Swiss standard for sending salary data electronically to the funds and the authorities. To Bill is not Swissdec-certified: you still file your returns with the funds yourself.

T–Y

Tax at source (Source tax). The income tax that the employer withholds from the salary of certain foreign employees and pays over to the canton.

Trial balance. The list of all accounts with their debit and credit totals and their balance. It lets you check that the books balance. See The trial balance and the general ledger.

TWINT. The Swiss mobile payment app. Your clients can pay your invoices in francs by TWINT if you have linked Stripe. See Get your invoices paid online.

UID (enterprise identification number). The unique number of every Swiss company, in the format CHE-123.456.789. Followed by the VAT suffix (MWST, IVA or its French equivalent), it is also the VAT number.

Unemployment insurance (UI). A social contribution deducted from the salary, paid half by the employee, half by the employer. To Bill works it out on each payslip.

VAT (value added tax). The consumption tax that a company registered for VAT adds to its prices and pays over to the FTA, after deducting input tax.

VAT rate. Since 1 January 2024: 8.1% (standard rate), 2.6% (reduced rate: food, books, medicines…) and 3.8% (accommodation) (Art. 25 VAT Act). See VAT and rates on your documents.

VAT return. The return you file with the FTA, usually every quarter, within 60 days of the end of the period (Art. 35 and 71 VAT Act). See Prepare and file the VAT return.

Voucher. The document that proves an entry: invoice, receipt, statement. Every entry must be based on a voucher (Art. 957a CO).

Withholding tax. A tax of 35% withheld on dividends and interest, which the recipient can then reclaim (Art. 4 and 13 VStG, the Federal Act on Withholding Tax, German version). See Have the profit appropriation decided.

Year-end closing. The work at the end of the financial year: last checks, depreciation, closing the accounts, then opening the next financial year. See Close the financial year.

Legal basis

The articles cited: CO (Code of Obligations), VAT Act (Value Added Tax Act), VStG (Federal Act on Withholding Tax, German version: fedlex has no English one), the Federal Act on Direct Federal Taxation (DBG, German version: fedlex has no English one).