Your clients’ profit appropriation and withholding tax

After the closing, the meeting of an AG, a GmbH or a cooperative decides on the appropriation of the profit. If there is a dividend, the company declares and pays withholding tax to the Swiss Federal Tax Administration (FTA) within 30 days. The cockpit shows you where each mandate stands and reminds you of the deadline.

Before you start

• The financial year must be closed in To Bill. See Close the financial year.
• Only an AG, a GmbH or a cooperative decides on the appropriation of its profit. For a sole proprietorship or a partnership, there is no decision, no dividend and no withholding tax.
• To prepare the decision in To Bill, the company must allow you to keep its books (Accounting · Manage).

Follow the decision in the cockpit

For an AG, a GmbH or a cooperative, the Accounting card in the Overview shows … profit appropriation as soon as the financial year is closed.

What the card shows	What it means
To decide, with Meeting by …	Nothing has been prepared. The meeting must be held within six months of the end of the financial year.
Proposal ready	The proposal is saved in To Bill; the meeting has not decided yet.
The date of the meeting, with Decided by the meeting	The decision has been booked.
Withholding tax: …	The return to the FTA is still to be filed, at the latest on this date.

Click the box: To Bill opens on the financial year’s profit appropriation.

In To do, the line File the … withholding tax (form …) appears as soon as the decision is booked, with its due date. It disappears when the return is marked as filed.

Prepare the decision in To Bill

1. On the Accounting card, click … profit appropriation, then confirm with Continue to ….
2. Check the Legal form. To Bill calculates the Legal reserve the law requires: 5% of the profit, until the statutory reserves reach half of the capital (20% for a holding company).
3. Prepare the proposal: Put aside in voluntary reserves, Take from voluntary reserves, Dividend (gross amount). To Bill calculates the 35% withholding tax and the net amount paid out.
4. Click Save the proposal. Proposal (PDF) prepares the document for the meeting, in French, German, Italian or English.
5. After the meeting, enter the Date of the meeting and, if needed, the Dividend payment date. Click Book the decision. The PDF of the decision is attached to the entry as its supporting voucher.

Each field and each calculation is explained in Have the profit appropriation decided.

Declare withholding tax

Once the decision is booked, the Withholding tax section in To Bill says what to do and by when.

1. Fill in the FTA form that To Bill indicates: form 103 for an AG, form 110 for a GmbH. Attach the signed annual accounts.
2. File it with File online with the FTA, at the latest on the date shown.
3. Pay the tax to the FTA within the same period: 30 days after the dividend payment date.
4. Come back to To Bill and click It is filed. The line leaves To do.

Even without a dividend

When total assets exceed CHF 5 million, the company also sends its annual accounts and the form to the FTA within 30 days of the meeting, even without a dividend. To Bill says so in the Withholding tax section.

A Swiss company holding at least 10%

A Swiss company that holds at least 10% of the capital can receive its dividend without the 35% deduction, with form 106. Enter the Part paid without deduction in To Bill, then attach form 106 to the return.

Legal basis

• The general meeting approves the annual accounts and decides on the appropriation of the profit, in particular the dividend: Art. 698 para. 2 no. 4 CO for the AG, Art. 804 para. 2 no. 5 CO for the GmbH. The ordinary meeting takes place within six months of the end of the financial year: Art. 699 para. 2 CO.
• 5% of the profit goes to the statutory retained earnings, until they reach half of the share capital, or 20% for a holding company: Art. 672 CO. The dividend may only be set after these allocations: Art. 675 para. 3 CO.
• Withholding tax applies to dividends on shares and on GmbH capital contributions, at the rate of 35%: Art. 4 para. 1 let. b and 13 para. 1 let. a VStG, the Federal Act on Withholding Tax (German version: fedlex has no English one). It falls due 30 days after the tax claim arises: Art. 16 para. 1 let. c VStG.
• When the profit appropriation decision results in a taxable payment, or total assets exceed CHF 5 million, the company sends the FTA the annual accounts and the official form within 30 days of their approval: Art. 21 para. 1 VStV, the Withholding Tax Ordinance (German version: fedlex has no English one). The reporting procedure for a holding of at least 10%: Art. 26a VStV.