In Switzerland, tax avoidance occurs when a taxable person ends up paying less taxes than they are legally required to as the result of omitting information in their tax returns. For example, if a person fails to declare a bank account in their tax returns, that is considered tax avoidance.
In tax avoidance, income or wealth are either not declared in full, are declared incorrectly, or are not declared at all.
Tax avoidance is punishable with a fine. Typically, the fine is equal to the difference between the incorrect and the correct amount of taxes due. But according to Swiss law, tax avoidance is punishable with a fine of up to 1000 francs. In extreme cases, or in the case of recurring tax avoidance, a fine of up to 10,000 francs can apply. In addition to fines, the culprit must also pay the difference owed.
In Switzerland, taxable entities can voluntarily admit to tax avoidance if they have failed to declare income or wealth in past tax returns. If the self-declared tax avoidance is not already known to the tax authorities, no fines will be applied. However, the taxes owed must be paid in arrears.
Tax fraud, on the other hand, occurs when a person deliberately submits documents that are counterfeit, forged, or contain incorrect information.
If you have questions about your Swiss taxes, it is best to inquire at your cantonal or municipal tax office directly.
