VAT for Freelancers in Switzerland: The Complete Guide

Sooner or later, every freelancer in Switzerland faces the question: do I have to charge VAT? And if so, how do I show it correctly on my invoices? This guide summarises the essentials – from the turnover threshold and current rates to filing with the Federal Tax Administration (FTA).

Note: this article is for general information only and does not replace professional tax advice. If in doubt, consult a fiduciary or the FTA directly.

When does VAT registration become mandatory?

The key number is CHF 100,000 in annual turnover. If your self-employed activity generates more than CHF 100,000 in worldwide turnover from taxable supplies within a year, you become liable for VAT and must register with the FTA.

Key points:

• What counts is your worldwide turnover, not just revenue earned in Switzerland.
• Liability generally starts when you begin your activity if it is foreseeable that you will exceed the threshold – or at the start of the following year if you crossed it during the current year.
• If you are just starting out, a realistic estimate is enough: if you expect more than CHF 100,000 in your first twelve months, you need to register from day one.
• Below the threshold you are exempt from VAT liability, but you may register voluntarily.

Voluntary registration: when does it make sense?

Even below CHF 100,000 in turnover, registering voluntarily can pay off:

• Input tax deduction: you can reclaim the VAT paid on your business expenses (laptop, software, rent, consulting). If you invest heavily in your start-up phase, that is real money back.
• B2B clients: for business customers, the VAT on your invoice is usually neutral, since they deduct it as input tax. You lose no competitiveness.
• Professional image: a VAT number signals scale and seriousness – some clients pay attention to it.

Voluntary registration is less attractive if your clients are mainly private individuals: for them, your services effectively become 8.1% more expensive, because they cannot deduct input tax.

Current Swiss VAT rates (since 2024)

Since 1 January 2024, the following rates apply in Switzerland:

• Standard rate: 8.1% – applies to most services and products, including typical freelance work such as design, programming, consulting or copywriting.
• Reduced rate: 2.6% – for everyday goods such as food, medication, books and newspapers.
• Special lodging rate: 3.8% – for accommodation including breakfast.

For the vast majority of freelancers, only the standard rate of 8.1% is relevant.

Effective method vs net tax rate method

When settling with the FTA, you can choose between two accounting methods.

Effective method

The standard method: you report the VAT you collected from clients and deduct the VAT you paid on your expenses (input tax), then transfer the difference. Filing is quarterly.

• Advantage: you reclaim the full input tax – ideal if you have high expenses or investments.
• Disadvantage: more bookkeeping, since every expense with input tax must be recorded.

Net tax rate method (Saldosteuersatz)

The simplified method for smaller businesses: you charge your clients the normal 8.1%, but pay the FTA only a flat industry-specific rate on your gross turnover (e.g. 5.9% or 6.2% depending on your sector). Input tax deduction is settled on a flat-rate basis. Filing is only semi-annual.

• Available up to roughly CHF 5.024 million in turnover and CHF 108,000 in tax due per year.
• Advantage: significantly less administration.
• Disadvantage: with high expenses and lots of input tax, the effective method often works out better.

For many service freelancers with low costs, the net tax rate method is the more convenient – and often financially attractive – choice.

Showing VAT correctly on your invoice

Once registered, your invoice must include the following VAT details:

1. Your VAT number: the UID with the suffix, e.g. CHE-123.456.789 MWST (or TVA / IVA depending on language)
2. The applied rate: e.g. 8.1%
3. The tax amount (or a note that VAT is included in the price)

Mini example: a VAT line on an invoice

Here is what a correct invoice with VAT looks like:

Item	Amount
Web design, 20 hrs at CHF 250	CHF 5,000.00
Subtotal (net)	CHF 5,000.00
VAT 8.1%	CHF 405.00
Total (gross)	CHF 5,405.00

Plus, in the invoice header or footer: VAT no.: CHE-123.456.789 MWST. Your client pays CHF 5,405 – and you pass the CHF 405 on to the FTA (under the effective method).

Filing and deadlines

• Effective method: filing per quarter.
• Net tax rate method: filing per half-year.
• Each return must be submitted and the tax paid within 60 days of the end of the period, online via the FTA portal.
• Late payments trigger default interest – so put the deadlines in your calendar.

Practical tip: move the VAT you collect into a separate account as you go. That way you never run into liquidity trouble when the return is due.

Input tax deduction: money back on your expenses

Under the effective method, you may deduct the VAT you paid on business expenses, for example on:

• hardware and software
• office rent and coworking
• training and professional literature
• consulting, fiduciary services, hosting

The condition is a correct supplier invoice showing their VAT number. Keep your receipts for at least 10 years.

FAQ

I earn CHF 60,000 per year. Do I have to charge VAT?

No. Below CHF 100,000 in annual turnover you are exempt from VAT liability. Voluntary registration is possible but not required.

Does the threshold apply to turnover or profit?

Turnover (your total income from taxable supplies), not profit.

Can I show VAT on my invoices without being registered?

No. If you are not registered, you must not show VAT. Tax shown without entitlement is still owed to the FTA.

Which method is better for me?

Rule of thumb: low expenses and little appetite for admin → net tax rate method. High expenses or investments → effective method. Switching is possible subject to certain notice periods.

How do I get a VAT number?

You register online with the FTA. Your VAT number is your UID with the suffix "MWST" (or "TVA"/"IVA").

Create invoices with VAT in minutes

With or without VAT, your invoices need to be formally correct – including the QR payment part according to the Swiss standard. With our free invoice generator, you enter your VAT number, rate and tax amount directly and get a ready-made QR-bill as a PDF: Create a free invoice now.