Tax deductions for companies in Switzerland

Updated on 22 August 2026. We reviewed loss offsetting, the depreciation rules, the research and development deduction and the rules for internationally active companies. What has changed since first publication: since 1 January 2024, the OECD minimum taxation of 15% has applied in Switzerland to groups of companies with annual revenue of EUR 750 million or more; the international top-up tax followed on 1 January 2025. In addition, on 19 December 2025, Parliament decided to extend loss offsetting from seven to ten years. This extension will enter into force on 1 January 2028 at the latest. Still valid without change: the seven-year period for loss offsetting under Art. 67 DBG, the depreciation rates in information sheet A/1995 of the Swiss Federal Tax Administration (ESTV), the cantonal additional deduction for research and development of up to 50% under Art. 25a StHG, and the principles on business expenses and provisions.

Basics of corporate taxation in Switzerland

In Switzerland, companies are subject in particular to profit tax (on profit) and capital tax (on equity). Tax rates differ depending on the canton and municipality. Taxable entities include public limited companies, limited liability companies and cooperatives. Permanent establishments and branches of foreign companies can also be liable to tax.

Tax treatment is based on the Federal Act on Direct Federal Tax (DBG) and the cantonal tax laws. Direct taxes are levied at federal, cantonal and municipal level. Key types of tax include profit tax, capital tax and VAT.

Tax deductions for companies in Switzerland

Companies can use various deductions to reduce their tax burden. These deductions can relate to operating costs, investments and certain strategic activities such as research and development.

Business expenses

Business expenses comprise costs incurred in connection with business operations, for example rent, salaries, material and administrative costs. Advertising, training, travel expenses and external services such as consulting or IT support can also be taken into account as business expenses.

This requires traceable documentation and retention of the relevant receipts.

Depreciation and write-offs

Fixed assets such as machinery, vehicles or buildings can be depreciated. This reduces taxable profit. Depreciation spreads the acquisition costs over several years, in line with the useful life.

The authoritative basis is ESTV information sheet A/1995. It sets standard rates as a percentage of book value, for example 25% for business furniture, 30% for equipment and machinery used for production, 40% for motor vehicles and 40% for data processing equipment. If depreciation is calculated on the acquisition value, these rates are halved. Depending on requirements and strategy, companies can use straight-line or declining-balance depreciation.

Research and development deductions

On application, the cantons can grant an additional deduction of up to 50% beyond the business-justified research and development expenses (Art. 25a StHG). Deductible are the directly attributable personnel costs plus a 35% surcharge, as well as 80% of the costs invoiced by third parties. This additional deduction does not exist for direct federal tax. Eligible costs include personnel expenses, material costs and external services in R&D. Expenses for patents and licenses within R&D projects can also be relevant.

Careful documentation of activities and costs is essential to be able to use the deductions.

Investment deductions

Investments in facilities, machinery or infrastructure are not deducted immediately; they are capitalized and depreciated over their useful life. For tax purposes, it is therefore the annual depreciation that counts, not the investment itself (Art. 62 DBG). This can support modernization and capacity expansion. Investment deductions can relate to IT infrastructure, production facilities or office equipment, among other things.

Some cantons have supplementary support programs.