Find out what drives us and what defines our values
Meet the experts who manage your finances with passion.
Discover our current job offers or apply proactively!
Tax and Legal
David Merz | Founding Partner
Zurich, June 16, 2024
Few people are excited by the prospect of the dreaded “tax season”. Filing taxes can be a complex and daunting task, especially for small businesses and freelancers navigating Swiss tax laws. While some may choose the do-it-yourself route to save costs, others might find hiring a tax advisor more beneficial for ensuring accuracy and optimizing tax liabilities.
This article explores the pros and cons of both approaches, helping you decide whether to tackle tax returns on your own or seek professional assistance to save time and make the most of your financial situation.
Book a free initial consultation with our experts.
Filing annual tax returns is an unavoidable aspect of financial responsibility for individuals and businesses alike. Even permanent employees whose employers withhold their income tax at source are generally still responsible for filing their own tax returns if their income exceeds certain thresholds, if they have additional income, or if they wish to claim deductions not considered in the source tax.
As for self-employed individuals and business-owners, tax filing is essential and often much more arduous. Swiss tax laws can be complex with variations depending on the canton you live or in which your business is registered. Understanding your obligations is the first step in ensuring compliance and avoiding penalties. Personal tax advisors and accountants can be a major aid in helping you clarify your filing obligations and undertaking the task of filing your tax returns for you.
Filing your own taxes can be a difficult and time-consuming task, especially when dealing with the nuances of Swiss tax laws. This leads many small businesses and freelancers to consider whether hiring a tax advisor might be more beneficial.
A tax advisor is a professional who specializes in tax law, planning, and compliance. Their primary role is to provide guidance and support to individuals and businesses in managing their tax obligations. Their main duties and services include:
Good tax advisors need to ensure they stay up to date with the latest tax regulations so they can use their expertise to help optimize their clients’ tax strategies, minimize tax liabilities, and identify opportunities for deductions or tax credits.
There are many reasons why it makes sense to hire a good tax advisor. Experienced tax advisors don’t only file your annual tax returns for you; they offer much more value, with services ranging from financial advice and strategic planning to tips for reducing and optimizing your tax liabilities. They will even communicate with the tax authorities on your behalf and therefore make your tax matters altogether simpler and more hassle-free.
Here are some key reasons to consider hiring a tax advisor:
There are not many drawbacks to hiring a tax advisor other than the additional costs involved and the risk of hiring an incompetent advisor:
The typical hourly rate for a tax advisor in Switzerland ranges from CHF 100 to CHF 250, but they can be as little as CHF 70 and as much as CHF 400 in extreme cases. The costs can vary significantly depending on several factors:
It is important to note that a higher rate doesn’t always mean a better consulting service. You should be as cautious of tax practitioners which charge an exorbitantly high rate as you should of those which charge an unrealistically low rate.
It is also possible to enlist the services of a freelance or in-house accountant to prepare your financial statements, payroll, and help you in submitting your tax returns. The benefit is that an accountant or bookkeeper will generally charge a lower rate than a professional tax advisor. That said, a tax advisor offers specialized knowledge in tax laws which may be needed in more difficult situations and could result in improved tax optimization. For simple tax situations, an accountant might suffice, but for more complex scenarios, a tax advisor’s expertise can be invaluable.
It is not mandatory for everyone to hire a tax advisor. Fortunately, tax tools and software have become more widely available, sophisticated and easy-to-use, meaning those with simple tax situations can often manage to complete their own tax returns. This is made easier with the help of free software that can be downloaded from the cantonal tax authorities’ websites.
The primary reason why some freelancers and business owners opt to file their own tax returns is to save on the cost of hiring a professional tax advisor. This can make sense if your tax situation is relatively straightforward, and/or you have some personal experience with accounting and tax filing.
Some of the benefits of filing your own tax returns include:
While it is possible to complete your own tax returns if your situation is relatively simple; if you want to save yourself the time and hassle and ensure that everything is accurate, it’s still worth hiring a tax consultant to help you. Filing your own tax returns comes with some risks that a qualified tax advisor can help you avoid, such as:
Fortunately, major advances in tax software and tools over recent years make it easier than ever for those who are determined to do their own tax returns without the support of a tax advisor. To mitigate the risks associated with completing their own tax returns, many are turning to these software solutions that simplify and automate their filing process. These programs offer step-by-step guidance, ensuring compliance and helping to identify potential deductions and credits.
Popular tax software options in Switzerland include:
The benefits of using tax and accounting software include:
While tax software and accounting tools are a useful aid in preparing your own tax returns, often the hands-on expertise of a tax advisor is irreplaceable. Those with simpler financial situations, such as full-time employees without multiple sources of income can, in most cases, get by on their own with the use of software tools. For businesses and self-employed entrepreneurs with multiple income streams, high-earning potential, and complex tax requirements, a tax advisor is generally still recommended.
Navigating the complexities of the Swiss tax system can be challenging, but you don’t have to do it alone. As a trusted accounting and tax advisory provider with a proven track record in Switzerland, Nexova offers expert services tailored to SMEs, startups and freelancers. With the use of advanced ERP, accounting and tax software such as Microsoft Dynamics 365 Business Central and SwissSalary, our team of experienced tax advisors and accountants can ensure the utmost accuracy, compliance, and optimization of your tax liabilities.
Whether you are an entrepreneur with your own startup, a small business owner or a freelancer, Nexova offers you the comprehensive and reliable tax advisory services you need to handle the complex world of taxes in Switzerland. Our comprehensive range of tax solutions, tailored to meet your individual needs, include:
Partnering with Nexova means gaining peace of mind, knowing that your tax matters are in capable hands. Contact us today to learn more about how we can assist you during tax season and beyond.
Your email address will not be published. Required fields are marked *
Comment *
Name *
Email *
Website
Submit Comment