If you're VAT-registered in Switzerland, you must choose an accounting method: the flat rate method (simplified) or the effective method (with input tax deduction). The wrong choice can cost you hundreds to thousands of francs per year — especially for self-employed individuals with low or high expenses, the difference is significant.
01Compare VAT methods
Enter your annual revenue, business expenses, and industry. The calculator computes the VAT liability for both methods and shows you the cheaper option.
02What is the flat rate method?
With the flat rate method, you apply an industry-specific flat tax rate to your gross revenue. The VAT liability is calculated directly — without having to document individual input taxes. This saves effort but can be more expensive if your actual input taxes are high.
- Gross revenue = Revenue × 1.081
- VAT due = Gross revenue × flat tax rate
- No input tax deduction needed
03What is the effective method?
With the effective method, you calculate VAT precisely: you charge 8.1% VAT on your revenue and deduct the input tax paid on business expenses. It's more work, but worthwhile when expenses make up a large share of revenue.
- VAT collected = Revenue × 8.1%
- Input tax = Expenses × 8.1 / 108.1 (expenses include VAT)
- VAT due = Collected − Input tax
04Flat tax rates by industry
The SFTA sets a flat tax rate for each industry. Here are the most common rates for self-employed individuals:
| Industry | Flat tax rate | Typical input tax ratio |
|---|---|---|
| Consulting, IT, Design | 5.9% | Low (little material) |
| Photography | 4.4% | Medium (equipment) |
| Crafts, Construction | 3.7% | High (material + tools) |
| Therapy, Healthcare | 2.0% | Very low |
| Restaurants | 5.1% | High (goods purchasing) |
| Retail (goods) | 1.3% – 6.7% | Very high |
05Tips for choosing a method
- Calculate your expense ratio: Divide your annual business expenses by revenue. Over 40–50%? Then examine the effective method closely.
- Plan for investments: Are major purchases coming up (computer, vehicle, equipment)? With the effective method, you can deduct the input tax.
- Note the 3-year commitment: Switching to the flat rate method means you're bound for at least 3 years. Plan ahead.
- Administrative effort: The flat rate method saves bookkeeping effort — you don't need to collect input tax receipts. With good accounting software, the extra work of the effective method is manageable.
- SFTA settlement: Regardless of the method, you must file your VAT quarterly with the SFTA.