Switzerland | Swiss Post Publishes VAT Registration Rules for Online Retailers

Swiss Post have issued a factsheet setting out the steps that foreign online retailers registered for Swiss VAT need to take if they are using Swiss Post to send postal consignments into Switzerland.

This is to ensure the correct customs clearance treatment and invoicing for those consignments.

The guidance explains that foreign online retailers should register with Swiss Post through its portal if they want to make sure that import VAT is correctly charged to them. Failure to do so may result in the client being incorrectly invoiced for the import VAT, the supplier being unable to recover import VAT if they paid it or the consignment being sent back to the supplier.

In addition, the Swiss Federal Tax Administration (FTA) also hosts a list of e-commerce businesses actively involved in mail-order activities. Inclusion on this list is also supposed to help parties undertaking customs clearance formalities know whether they should charge the import VAT to the parcel recipient or the supplier. Companies that wish to be added to the FTA’s list have to give their express consent.

Mandatory registration for Foreign eCommerce Companies

As reported earlier, Switzerland’s new rules on imports of low value goods, targeting e-commerce companies, came into effect from the start of 2019. They provide that any person making supplies of such goods into Switzerland and generating a turnover from these supplies of at least CHF 100,000, in the previous 12 months, must register for Swiss VAT, because the place of supply of the goods is shifted to Switzerland.

Low value imports are goods that are exempt from Swiss import VAT due to the insignificant tax amount (no more than CHF 5).  This means that standard-rated goods with a value of up to CH 65 and reduced-rated goods with a value of up to CHF 200 are exempt.

When a business starts making supplies of low value imports of goods into Switzerland, the place of supply continues to be abroad, provided that the CHF 100,000 threshold isn’t breached. But, from the beginning of the month following the month in which the threshold is exceeded, the place of supply for all imports of goods shifts to Switzerland and the business is required to register for Swiss VAT.

If you should like to discuss how this development affects you further, or of you have other questions on recent changes to the Swiss VAT rules, please do get in touch with us for a chat.