manage the tax risks on real estate transactions
The Swiss real estate market has lived an impressive growth during the last ten years and the tendency is not to recession. The Swiss real estate is therefore still an interesting market for the private and institutional investor, should they be Swiss or foreigners.
Whatever the acquisition form is (in own name or through a special purpose vehicle), the real estate investor has to face multiples obstacles. Those can be legal as well as tax. For example, there are still limitations for foreigners who wish to acquire Swiss real estate and the question of the acquisition vehicle is absolutely crucial, particularly when the time to exit will come. Other barriers can arise, especially regarding taxation of the private investor (tax free capital gain or taxable wealth income, real estate gain tax, etc.) or of the institutional investor (dividend distribution, real estate gain tax, intercantonal tax allocation, VAT, etc.).
All those hurdles need a professional and well thought approach, especially regarding tax and legal issues. This approach has to take into account not only the situation of seller, but also the one of the purchaser and this for his short, middle and long term projects.
The tax risks related to the real estate market are very high, notably the underlying risks of an existing structure or unpaid taxes. There is also a number of tax duties, notably the obligation to prepare an intercantonal tax allocation between the cantons and the communes, issues with real estate gains, real estate transfer tax, real estate ownership tax, other taxes and for sure VAT.
To avoid any bad surprise, our specialists are at your disposal to advise you on the best way to invest in real estate to lower your tax risk and maximize your possible tax savings, should it be at the time of purchase, during the holding period or at the time of exit. Our services in that field start from the due diligence until exit, including the design of the acquisition structure, the management of the tax duties, the follow-up with the notary and the tax authorities, the tax returns and the management of the VAT issues and returns.