Blog
Consulting Sàrl with CHF 140,000 turnover: CHF 1,893.60 net VAT
Fictional Geneva case: a consulting Sàrl with CHF 140,000 turnover. CHF 100,000 threshold, effective method, flat-rate (TDFN) and VAT return, calculated line…
Published on
The starting case: a Geneva consulting Sàrl
The case below is fictional but plausible. A Sàrl (limited liability company) providing organisational consulting is entered in the Geneva commercial register on 1 January 2026. It invoices services to clients in Switzerland. Its projected turnover for 2026 is CHF 140,000, excluding VAT.
The company does not yet have a VAT number. Its first deadline is the Q1 return, to be filed no later than 60 days after 31 March, i.e. 30 May 2026. The manager wishes to know the amount due and whether the administrative burden can be reduced.
All amounts are expressed in CHF. They are based on the provisions of the Federal VAT Act (LTVA) and on the information published by the Federal Tax Administration (FTA).
The assumptions of the case
The activity is a consulting service, taxed at the standard rate. Since 1 January 2024, the rates are 8.1% (standard), 2.6% (reduced) and 3.8% (accommodation). Only the 8.1% rate applies here.
Expected monthly turnover, excluding VAT:
January: CHF 6,000
February: CHF 8,000
March: CHF 10,000
April to August: CHF 12,000 per month, i.e. CHF 60,000
September to December: CHF 14,000 per month, i.e. CHF 56,000
The total reaches CHF 140,000. The first quarter represents CHF 24,000, the second CHF 36,000.
Expenses with recoverable VAT over the year: office rent and management costs of CHF 16,000, IT equipment and services of CHF 9,000, fees and miscellaneous costs of CHF 7,000. The total is CHF 32,000, amounts excluding VAT, invoiced at 8.1%.
Return frequency: quarterly under the effective method. The VAT return is filed by period, and the FTA assigns the frequency upon registration.
The effective method requires input tax to be calculated on each invoice received. The flat-rate net tax rate (TDFN), by contrast, applies a flat rate to turnover, with no input tax deduction.
The CHF 100,000 threshold: when VAT liability begins
Under Article 10 LTVA, VAT liability begins when taxable turnover reaches CHF 100,000 over the coming twelve months. The threshold is projected, not observed at the annual close.
In our case, the projection of CHF 140,000 over twelve months exceeds the threshold from day one. VAT liability therefore arises upon incorporation, on 1 January 2026. The company must register with the FTA within 30 days of the start of liability, i.e. no later than 31 January 2026.
If the projection had been CHF 90,000, later exceeded during the year, liability would have begun at the end of the month in which the threshold is crossed. Late registration leads to retroactive assessment: VAT is due on transactions since the date of liability, even if it was not invoiced to clients. This shortfall remains at the company's expense.
The projection should be documented: signed contracts, ongoing mandates, accepted quotes. This evidence serves as proof in the event of an audit.
The calculation, line by line
The calculation is carried out first by quarter, then for the year. Let us take Q1, from January to March.
VAT due on turnover:
taxable base: 6,000 + 8,000 + 10,000 = CHF 24,000
rate: 8.1%
VAT due: 24,000 x 8.1% = CHF 1,944.00
Deductible input tax. The quarter's expenses are CHF 8,000 excluding VAT, including CHF 5,000 of incorporation costs and furniture:
base: CHF 8,000
rate: 8.1%
input tax: 8,000 x 8.1% = CHF 648.00
Q1 balance: 1,944.00 - 648.00 = CHF 1,296.00 payable.
For the following quarters, the logic is identical. Expenses are spread as follows: CHF 8,000 in Q2, CHF 8,000 in Q3, CHF 8,000 in Q4.
Quarter 2: VAT due 36,000 x 8.1% = CHF 2,916.00. Input tax CHF 648.00. Balance CHF 2,268.00.
Quarter 3: turnover of CHF 36,000, balance of CHF 2,268.00.
Quarter 4: turnover of CHF 42,000, VAT due CHF 3,402.00, input tax CHF 648.00, balance CHF 2,754.00.
Over the year:
VAT due: 140,000 x 8.1% = CHF 11,340.00
input tax: 32,000 x 8.1% = CHF 2,592.00
net balance: CHF 8,748.00
According to the FTA, net VAT payable is the difference between VAT on sales and deductible input tax, calculated per return period (LTVA, Art. 36 et seq.).
The completed VAT return: what goes to the FTA
The Q1 return carries the following figures in the FTA form, filed via the electronic portal:
item 200 (total turnover): CHF 24,000
item 302 (services taxed at the standard rate): CHF 24,000, tax of CHF 1,944.00
item 400 (input tax on expenses and investments): CHF 648.00
item 500 (amount payable): CHF 1,296.00
The item numbers are indicative and should be checked against the FTA form currently in force.
The filing deadline is 60 days after the end of the period. For Q1, it falls on 30 May 2026. Payment is due within the same period.
In the event of late payment, default interest runs from the due date. The rate is set by the Federal Department of Finance and can be consulted on the FTA website. A fixed rate should not be assumed from one year to the next.
For each return, the company keeps the invoices issued, the invoices received showing the supplier's VAT number, and the general ledger. The LTVA requires supporting documents to be kept for ten years. For a general overview of the mechanics, see our article on how to calculate sales tax in Switzerland.
Key takeaway
With projected turnover of CHF 140'000, the Sàrl is liable for VAT from incorporation and must pay CHF 1'296 no later than 30 May 2026 for Q1.
Source: Art. 10 and Art. 36 et seq. LTVA — Federal Tax Administration (FTA) — fedlex.admin.ch
Variants: effective method or flat-rate net tax rate
The TDFN is available to small businesses whose turnover does not exceed CHF 5,024,000 and whose annual tax liability does not exceed CHF 103,000. These limits are set by the VAT Ordinance and may change. The return is then half-yearly.
The rate depends on the sector. For consulting services, the usual TDFN is 6.2% according to the FTA's list of rates. This value depends on the sector and the year: it must be confirmed on the official list before any choice is made.
Calculation over the year:
turnover including VAT: 140,000 x 1.081 = CHF 151,340.00
VAT due under the TDFN: 151,340 x 6.2% = CHF 9,383.08
no deductible input tax
The balance is therefore CHF 9,383.08, against CHF 8,748.00 under the effective method. The difference is CHF 635.08 to the disadvantage of the TDFN.
This result stems from the expenses: CHF 32,000 of expenditure with VAT generates CHF 2,592.00 of recoverable input tax. If expenses were only CHF 10,000, input tax would fall to CHF 810.00. The effective method would give CHF 10,530.00 and the TDFN would remain at CHF 9,383.08: the difference would reverse.
Selection criteria: level of expenses with VAT, planned investments, administrative burden. Opting for the TDFN commits the company for a minimum period of one year, with a notice period to be observed in order to leave it.
Variant: turnover below CHF 100,000
Let us revisit the case with a projected turnover of CHF 85,000. The company is not liable for VAT: it does not charge VAT and does not file a return.
It may, however, opt for voluntary liability (LTVA, Art. 11). The CHF 85,000 of revenue then generates VAT due of CHF 6,885.00 (85,000 x 8.1%). Input tax on CHF 32,000 of expenses is CHF 2,592.00. The balance is CHF 4,293.00.
What is gained: recovery of CHF 2,592.00 of input tax, useful if clients are themselves VAT-liable and deduct the VAT invoiced. What is lost: if clients are private individuals, the VAT of CHF 6,885.00 is added to the price or reduces the margin. Added to this are the administrative burden and the long-term commitment.
This choice therefore depends on the client profile, more than on the amount of expenses. For the general framework, our article on what VAT is in Switzerland, its rates and refunds recalls the principles.
Comparison table of the scenarios
Same company, three scenarios, over one year. The effective method and TDFN amounts are based on CHF 140,000 of turnover and CHF 32,000 of expenses. The non-liable scenario is based on CHF 85,000 of turnover.
Effective method (CHF 140,000 turnover):
VAT due: CHF 11,340.00
VAT recovered: CHF 2,592.00
net balance: CHF 8,748.00
administrative burden: high, four quarterly returns and tracking of every invoice
TDFN at 6.2% (CHF 140,000 turnover):
VAT due: CHF 9,383.08
VAT recovered: CHF 0.00
net balance: CHF 9,383.08
administrative burden: reduced, two half-yearly returns
Not liable (CHF 85,000 turnover):
VAT due: CHF 0.00
VAT recovered: CHF 0.00
net balance: CHF 0.00
administrative burden: minimal, but the VAT paid on expenses (CHF 2,592.00) remains a cost
The ranking between the effective method and the TDFN depends on the share of expenses with VAT. Here, the effective method comes out ahead by CHF 635.08. With lower expenses, the TDFN becomes more advantageous. The table must therefore be redone with each company's actual figures, never with those of another case.
Three transferable lessons
First lesson: project the CHF 100,000 threshold from the very first month, over a rolling twelve months, with contracts in hand. Late registration leads to a retroactive assessment that the company bears out of its margins.
Second lesson: before choosing between the effective method and the TDFN, simulate both on the year's actual expenses with VAT. The sector rate is read from the official FTA list, never from memory. Cases of input tax refund are detailed in our article on VAT refunds in Switzerland.
Third lesson: for each return, keep the breakdown of turnover by rate, the supplier invoices showing their VAT number, and proof of filing within the 60-day deadline.
A chartered accountant can validate the threshold projection, the method and the first return before the deadline.
"This article is provided for information purposes only and does not constitute personalised legal, tax or accounting advice; as Swiss VAT rates and rules change regularly, we recommend consulting a qualified professional or the Federal Tax Administration before making any decision."
FAQ
VAT liability begins when taxable turnover reaches CHF 100,000 over the coming twelve months (LTVA, Art. 10). The projection is made from incorporation, not at the close of the financial year.
The VAT return is filed within 60 days following the end of the return period. For Q1, the deadline is 30 May. Default interest is due in the event of late payment, at the rate set by the Federal Department of Finance.
No. The TDFN removes the input tax deduction. It is more advantageous when expenses with VAT are low. With high expenses, the effective method often gives a lower balance. The calculation must be redone for each case.
Yes, through voluntary liability (LTVA, Art. 11). It recovers input tax on its expenses but charges VAT to its clients. The option is mainly suitable if the clientele is itself VAT-liable and deducts the VAT invoiced.
Élodie Rochat
