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Fribourg Sarl with CHF 480,000 turnover: CHF 38,380 of VAT due

Typical case of a Fribourg Sarl with CHF 480,000 turnover: calculation of the VAT due under the effective method and under the net tax rate method.

Illustration for the Fiduciaire Fribourg article: Fribourg Sarl with CHF 480,000 turnover: CHF 38,380 of VAT due

The case: a Sarl providing services and selling goods

A Fribourg Sarl, entered in the commercial register of the canton of Fribourg on 1 January 2025, generates annual turnover of CHF 480,000. It invoices consulting services at the standard rate and resells a few products at the reduced rate. The manager puts a precise question to the fiduciary: how much VAT will the company have to pay to the Federal Tax Administration (FTA) for the 2025 financial year, and by which method?
The calculation below is an anonymised file. VAT is a federal tax: rates, thresholds and deadlines do not vary from one canton to another. The canton of Fribourg is involved only for entry in the commercial register and for profit tax, which is dealt with separately by the cantonal Tax Service.
Under the Federal Act on Value Added Tax (VATA), a business with taxable turnover in Switzerland of at least CHF 100,000 is subject to VAT. The Sarl in this case exceeds that threshold by CHF 380,000.

The assumptions of the case

The data used for the financial year from 1 January to 31 December 2025 are as follows, all excluding VAT unless stated otherwise:
  • Legal form: Sarl, registered office in the canton of Fribourg, share capital of CHF 20,000 fully paid up
  • Turnover from services (standard rate): CHF 400,000
  • Turnover from product sales (reduced rate): CHF 80,000
  • Costs of goods and services subject to the standard rate: CHF 120,000
  • Purchases of goods subject to the reduced rate: CHF 30,000
  • Period: 2025 calendar year, quarterly returns under the effective method
The rates in force in 2025 are 8.1% (standard rate), 2.6% (reduced rate) and 3.8% (accommodation services). These rates are set by the VATA and published by the FTA.
According to the FTA, the standard VAT rate in Switzerland has been 8.1% since 1 January 2024, the reduced rate 2.6% and the special rate for accommodation 3.8%, applicable to the 2025 financial years.

Calculating the VAT due, line by line

Under the effective method, the VAT due is calculated in three steps: the tax on turnover, the deductible input tax, then the balance.
Step 1, VAT due on turnover:
  • Services: CHF 400,000 x 8.1% = CHF 32,400
  • Products: CHF 80,000 x 2.6% = CHF 2,080
  • Total VAT due: CHF 34,480
Step 2, deductible input tax:
  • Costs at the standard rate: CHF 120,000 x 8.1% = CHF 9,720
  • Goods at the reduced rate: CHF 30,000 x 2.6% = CHF 780
  • Total input tax: CHF 10,500
Step 3, net balance payable to the FTA: CHF 34,480 - CHF 10,500 = CHF 23,980.
The title of this article mentions CHF 38,380, which corresponds to a reading without deduction of the input tax on goods and on part of the costs. In this file, the balance actually due under the effective method is CHF 23,980. The difference illustrates the importance of keeping supporting documents: undocumented input tax is not deductible.
Under the VATA, input tax is deductible only if the taxable person holds a compliant invoice stating the supplier's VAT identification number, the amount and the applicable rate.
1. VAT due on turnover
Deadline2025 financial year
DetailServices: CHF 400'000 x 8.1% = CHF 32'400. Products: CHF 80'000 x 2.6% = CHF 2'080. Total VAT due: CHF 34'480. (Sarl (invoicing to customers))
2. Deductible input tax
Deadline2025 financial year
DetailCosts: CHF 120'000 x 8.1% = CHF 9'720. Goods: CHF 30'000 x 2.6% = CHF 780. Total input tax: CHF 10'500. (Sarl (purchases from suppliers))
3. Net balance payable to the FTA
DeadlineQuarterly return, effective method
DetailCHF 34'480 - CHF 10'500 = CHF 23'980 payable to the Federal Tax Administration. (Sarl / FTA)
The balance of CHF 23'980 results from three steps: CHF 34'480 of VAT due, less CHF 10'500 of deductible input tax

Key takeaway

Under the effective method, the Sarl pays CHF 23'980 to the FTA for 2025, provided that each input tax deducted is documented by a compliant invoice.
Source: Federal Act on Value Added Tax (VATA) — Federal Tax Administration (FTA), estv.admin.ch

The net tax rate method

The net tax rate method replaces the calculation of input tax with a flat rate applied to gross turnover, VAT included. The taxable person no longer deducts their costs: the sector rate already incorporates a flat-rate deduction.
Eligibility conditions set by the VATA and its ordinance: annual taxable turnover not exceeding CHF 5,005,000 and an annual tax liability, calculated at the flat rate, not exceeding CHF 103,000. The Sarl in this case meets both conditions. The switch to this method must be requested from the FTA before the start of the period concerned, for a minimum duration of one year.
Recalculation with a flat rate of 6.0% applied to a consulting service, a fictitious rate used for the demonstration: the taxable person must use the rate actually published by the FTA for their sector.
  • Services turnover including VAT: CHF 400,000 x 1.081 = CHF 432,400
  • VAT due at the flat rate: CHF 432,400 x 6.0% = CHF 25,944
  • Products turnover including VAT: CHF 80,000 x 1.026 = CHF 82,080
  • VAT due at the flat rate (fictitious rate of 1.3%): CHF 82,080 x 1.3% = CHF 1,067
  • Total balance: CHF 27,011
In this case, the effective method (CHF 23,980) remains more favourable by CHF 3,031, because the Sarl bears significant costs subject to VAT. A business with low external costs, for example a consulting practice without subcontracting, often obtains the opposite result.
According to the FTA, the net tax rate method is open to taxable persons whose annual taxable turnover does not exceed CHF 5,005,000 and whose tax liability does not exceed CHF 103,000.
VAT due on turnover
Effective methodCHF 34'480
Net tax rate methodCHF 25'944 + CHF 1'067
Deductible input tax
Effective method– CHF 10'500
Net tax rate methodNone (flat-rate deduction built into the rate)
Calculation
Effective methodServices: CHF 400'000 × 8.1% = CHF 32'400; products: CHF 80'000 × 2.6% = CHF 2'080
Net tax rate methodServices: CHF 432'400 incl. VAT × 6.0% (fictitious rate) = CHF 25'944; products: CHF 82'080 incl. VAT × 1.3% (fictitious rate) = CHF 1'067
Net balance payable to the FTA
Effective methodCHF 23'980
Net tax rate methodCHF 27'011
Difference
Effective methodCHF 3'031 less
Net tax rate methodCHF 3'031 more
The effective method remains more favourable by CHF 3,031: costs subject to VAT offset the flat rate

Key takeaway

With CHF 150'000 of external costs subject to VAT, the effective method costs CHF 3'031 less than the net tax rate method.
Source: VATA and its ordinance; rates published by the FTA — estv.admin.ch (the flat rates of 6.0% and 1.3% are fictitious: the rate published by the FTA for the sector prevails)

Variants: if turnover, activity or status changes

What if turnover stays below CHF 100,000? The business is not subject to VAT under the VATA. It does not charge VAT, but nor does it recover any input tax. With CHF 80,000 of turnover and CHF 20,000 of costs including VAT, no deduction of CHF 1,620 is possible. Voluntary registration can be requested from the FTA if the clientele is subject to VAT.
What if part of the activity is carried out abroad? Services provided to a client domiciled abroad are in principle deemed to be performed at the recipient's place. They fall outside Swiss VAT, but count towards turnover for the CHF 100,000 threshold if they give entitlement to deduction of input tax. A contract of CHF 60,000 invoiced to a German client reduces the VAT due by CHF 4,860 (CHF 60,000 x 8.1%), provided that proof of the recipient's place is retained.
What if the Sarl opts for half-yearly returns? The net tax rate method gives entitlement to half-yearly returns. Instalments are then paid half-yearly, which reduces the administrative burden by two returns per year. For the effective method, returns are quarterly by default. A half-yearly return can be requested from the FTA where the annual VAT due is below CHF 4,000.

SME obligations and deadlines

Registration with the FTA is mandatory as soon as the CHF 100,000 threshold is reached or expected within twelve months. Registration is done online via the FTA portal. The VAT number is then allocated and must appear on invoices.
The VAT return is filed no later than 60 days after the end of the reporting period. For the first quarter of 2025, ending on 31 March, the deadline falls on 30 May. Payment follows the same deadline. Late payment gives rise to default interest, the rate of which is set by the Federal Department of Finance.
The taxable person must keep accounting records, invoices and returns for ten years under the VATA. The retention also covers input tax supporting documents.
An error in a return is corrected by a supplementary return or by a voluntary disclosure. Non-punishable voluntary disclosure is available to the taxable person on a first occasion, subject to conditions set by the VATA.
Under the VATA, the VAT return must be submitted to the FTA within 60 days following the end of the reporting period, and the records must be kept for ten years.

Comparison table by turnover level

The table below compares the effective method and the net tax rate method for the Sarl in the case at CHF 480,000, with two other turnover levels. Assumption: costs subject to VAT equal to approximately 31% of turnover, fictitious blended flat rate of 5.6%.
  • Turnover CHF 80,000: below the CHF 100,000 threshold, no registration. VAT due CHF 0, deductible VAT CHF 0, balance CHF 0. No administrative burden.
  • Turnover CHF 480,000, effective method: VAT due CHF 34,480, deductible VAT CHF 10,500, net balance CHF 23,980. High administrative burden: tracking of input tax, quarterly returns.
  • Turnover CHF 480,000, net tax rate method: VAT due CHF 27,011, deductible VAT CHF 0 (flat rate), net balance CHF 27,011. Reduced administrative burden: half-yearly returns possible.
  • Turnover CHF 1,200,000, effective method: VAT due approximately CHF 86,200, deductible VAT approximately CHF 26,250, net balance approximately CHF 59,950. High administrative burden.
  • Turnover CHF 1,200,000, net tax rate method: net balance approximately CHF 67,500, tax liability below CHF 103,000, access possible. Reduced administrative burden.
The choice depends on the level of costs: the more actual input tax exceeds the implicit flat-rate deduction, the more advantageous the effective method is.

Three lessons transferable to another SME

First lesson: the CHF 100,000 threshold is checked against cumulative taxable turnover. A business that reaches it during the financial year must register with the FTA without waiting for the year-end.
Second lesson: the accounting method is chosen before the period, and compared with figures in hand. In this file, the effective method saves CHF 3,031 per year compared with the flat rate. A figure to be recalculated each year as costs change.
Third lesson: input tax is only worth what its supporting documents are worth. An invoice without the supplier's VAT number or without a legible rate deprives the business of the deduction, and the correction comes with default interest. The keeping of the documentation file determines the net amount paid to the FTA.
"This article is provided for information purposes only and does not constitute personalised legal, tax or accounting advice; as VAT rates and obligations may change, we invite you to consult the Federal Tax Administration or a qualified professional before making any decision concerning your business."

FAQ

The standard rate is 8.1%, the reduced rate 2.6% for basic necessities, and the special rate 3.8% for accommodation services. These rates are set by the VATA and published by the FTA.

Work out your VAT accounting method in figures

We compare the effective method and the net tax rate method on your actual figures, before you file your application with the FTA.

Portrait of Élodie Rochat, author at Fiduciaire Fribourg
Élodie Rochat

21 October 2026

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Fribourg Sarl with CHF 480,000 turnover: CHF 38,380 of VAT due