Start a small online store in Switzerland - what about taxes?

Finance, Taxes, Banking, Insurance and Retirement
1
Hello!!

I am living in Switzerland at the moment, my husband works here so I have a resident permit. Sometime ago I created a website that I want to turn into a small online shop, selling stuff that I made and stuff I purchase.

It wouldn't be something big, since I will be doing this on my own, without physical store or employees or anything like that.

I found different e-commerce builders but I started to see stuff about collecting taxes, and I wonder how does this work here, do I have to register a company to sell online? I would like to sell locally and internationally even if I won't be offering lots of products at the same time.

Do I have to declare taxes?

If you have any information regarding regulations to sell online please let me know, clearly I am completely out of my element here.

thanks a lot!

2
If you are a non-EU/Swiss citizen, you will need to obtain permission to be self-employed:

https://www.ch.ch/en/working-foreign...-requirements/

If you are able to obtain permission to be self-employed, you will need to pay income taxes on your earnings from the business. If your annual revenues exceed CHF 100'000, you will also need to register the business and charge VAT:

https://www.ch.ch/en/becoming-self-employed/

3
Hi, thank you for your answer.

Even if it is only online, and selling like 10 pieces at a time, I have to gain permission to be self employed??? income taxes shouldn't be pay after certain amount? Like if I earn with this less than 300 CHF a month, do I still need to pay income taxes and obtain permission for this?

4
Possibly & in theory yes it depends on how much less. You just register as part time self employed AHV payments will be a minimum of 475 a year.

5
Interesting... is this applicable to the odd hobby items being sold through eBay or Ricardo also?

e.g. if the net sales are well within 10,000 CHF annually.

6
Couldn't you operate at a loss, and then reduce your tax liabilities?

By the way, are you aware of any Swiss laws about moonlighting? I understand employee contracts commonly prohibit work outside of regular employment.

7
Depends if it's just the odd sale or a business, only you can decide the answer to that.

8
Based on the Beobachter article below, occasional hobby sales of items from your own household over the internet are not considered a business and not subject to income tax and AHV social charges. However, if the seller is regularly selling products over the internet to earn a profit, then it would be considered a profit-oriented business subject to income tax and AHV. Relevant expenses from this business could of course be deducted to determine the taxable income.

"Muss ich die auf E-Bay erzielten Verkaufserlöse versteuern? Frau S., Kanton Zürich Die Eidgenössische Steuerverwaltung schreibt dazu: «Solange es sich bloss um den Verkauf von eigenem Hausrat, eines Sportgeräts oder auch des eigenen Privatfahrzeugs über eine Online-Börse handelt, bleiben solche Verkäufe steuerfrei.» Schliesslich konnten Sie die Anschaffung dieser Objekte auch nicht vom steuerbaren Einkommen in Abzug bringen. Und selbst gelegentliche Online-Verkäufe für Freunde und Bekannte, von denen Sie für den Dienst eine Kommission erhalten, sind steuerfrei, solange es sich um einen reinen Hobbybetrieb handelt.

Anders sieht es aus, wenn Sie aus dem Online-Handel einen eigentlichen Erwerb machen möchten, egal ob teilzeitlich oder vollberuflich. Wenn Sie also systematisch Ware zusammensuchen und sie als sogenannter Powerseller über eine Internetplattform wie E-Bay, Ricardo oder sonst eine Online-Börse regelmässig und mit Gewinnabsicht weiterverkaufen, handelt es sich um einen selbständigen Erwerb. Und darauf sind Einkommenssteuer und Sozialversicherungsbeiträge fällig. Immerhin dürfen Sie dann im Gegenzug als Selbständigerwerbende auch Ihren Aufwand (Anschaffungskosten der Waren, Lagerhaltung, Transport, Auktionsgebühren und so weiter) vom Ertrag in Abzug bringen. Wichtig ist, dass Sie sämtliche Belege geordnet aufbewahren, um Ihren Aufwand gegenüber der Steuerbehörde gegebenenfalls auch beweisen zu können."

http://www.beobachter.ch/dossiers/st...us-der-praxis/

9

For income taxes and AHV there is no de minimus sales amount. For purposes of taxation it is a matter of whether the sales are occasional and the items from one's own household, or whether the sales are profit seeking as in a business.

Occasional minor profits from hobbies may not be taxable and hobby losses cannot be deducted from other income.

For purposes of registering the business and charging VAT, there is a threshold of CHF 100'000 in sales.

This might also be helpful:

"Declaring supplementary income

If you have earnings in addition to you main employment, you must also pay tax on that income. You also have to pay social security contributions on these subsidiary earnings. Basically, any wage or salary is subject to AHV / IV / EO deductions. There is one exception: If you do not earn more than CHF 2,300 in one year with one employer, you only have to pay social security contributions if you choose to.

If you correctly declare your subsidiary earnings in your tax return, you can make deductions for business expenses as you can with your main source of income. If your subsidiary earnings are from self-employment, you can claim the actual business expenses for this activity."

https://www.ch.ch/en/declaring-supplementary-income/

10
Thank you all for your answers,

I have no job, it is my husband who works here in Switzerland and I have a B permit because of that.

It would be more like occasional hobby sales of items online. That's why I mentioned selling maximum 10 pieces at a time. Sometimes it would be things I do myself, or things I purchased elsewhere while traveling and stuff like that. So that is why I was asking if

a) I need to register in order to sell like this

b) If I have to pay taxes for this since I won't be earning much

c) Am I allowed to ship this goods outside of Switzerland? Do I have to charge people for VAT or taxes?

So technically, as I understand, for what I want to do, I won't have to register as a company, charge VAT or pay taxes.

11
You won't have to register for VAT, probably AHV & taxes, but it's up to you in the end if you bother.

12
You won't be able to register for MwsT (VAT) as your sales will be too low so you won't be able to charge VAT

You can sell abroad, just make sure you fill in the customs declaration form at the Post Office correctly so your customer doesn't get too stung by import costs.

TBH, I wouldn't even bother registering as self employed for such small sales, it's clearly a hobby "business".

13
Hello, I am new here.

Very Interesting post. I was also wondering the same thing and came across this and it has been really helpful, so thanks to everyone answering questions here, it is great for people like me trying to understand the system here.

My case is similar, I want to sell handmade products, but other stuff as well that I haven't done myself online. I have a small blog, that I started 3 months ago, with followers mostly on Instagram and I was looking into selling things online. To start and test the waters, I was thinking as well about selling a very small quantity, lets say 10 pieces at a time, nothing mass production or anything like that.

But thinking about registering a company, paying tax and all that seems a lot when I don't even know if its going to be a success.

Do you think I can install a ecommerce service on my blog and start selling stuff (note that the small amount of followers I have are from around the world, not necessarily from Switzerland) so I would be shipping things to other countries.

I have to find more about this since I know nothing about "exporting" stuff. Thanks for mentioning this.

How can I know if my thing is more like a "hobby business" and won't be required to pay tax or anything like that?

If I keep it as something ocassional and only sell small quantities would it be ok?

As the other person on the comments, I won't be earning lots of money out of this, I was thinking maybe I can make around 300 a month if I am lucky, since the stuff I plan to sell is not expensive and as I said I don't plan to sell lots of stuff at the same time.

For now I just want to try this and see if it has potential, and then of course I would make this more official, but for now talking about taxes, charging VAT and registering seems like too much for me.

14
Let's go over two points again:

VAT: once your annual sales reach CHF 100'000, you need to obtain a VAT number and begin charging Swiss VAT to your Swiss customers:

"Value added tax (VAT)

If you generate an annual turnover of more than CHF 100,000, you must pay VAT. You must register with the Federal Tax Administration (FTA) of your own accord within 30 days from when you begin generating income."

https://www.ch.ch/en/becoming-self-employed/

Commercial Register registration:

If you are a sole trader, you need to apply for registration in the Commercial Registry when annual sales reach CHF 100'000:

"Im Handelsregister müssen namentlich eingetragen sein:

Einzelfirmen ab CHF 100'000 Jahresumsatz" Excepting sole traders, other legal forms must be registered in the Commercial Register at set-up of the company.

http://www.kmu.admin.ch/kmu-gruenden...x.html?lang=de

These two items are separate from obtaining permission to be self-employed.

15
Would you have more resources (books/websites/advisor) about this topic? I am interested in learning more about this way of operating a company.

Reason: we own a GmbH (online retail). I noticed last year, that an increase in value of the goods that we have is taxed. Due to that, it is impossible to invest all profit in a larger product portfolio. I am searching for "long lasting" investments that I can do to increase the revenue in the future that can be deducted now, so I can grow the company and save on taxes....

16
Just found this thread. These links even if very informative, do not offer specifics regarding the setting of an online business. I've found this one where one can get real advice on how to do it, and the know how of the various business aspects step by step with financial help also, just click on the tags. Have a look.

http://https://www.ifj.ch/index.cfm?...entpool_id=117

17
1) To be honest, I personally think, if you are on a b-permit, unless it is restricted (should state it on the permit document) you have the right to work. Check your b-permit.

2) If you make a profit ( Profit = Revenue - Material Cost- Labor ), then you will have to declare that as well.

3) Typically any sales, should collect VAT from the buyer. [you probably havent noticed, but its on your bill] If you are not collecting it explicitly, then ~approximately 8% of your sales value is owed as VAT. If you are keeping detailed records of your purchases and sales, then you can also make a detailed calculation.

https://www.ch.ch/en/vat/

In the end it is not too complicated.

If you go to www.startups.ch they will guide you with everything. They have a lot of seminars.