A nine-digit number identifying a specific bank or branch within the United States banking system. It routes domestic payments (such as ACH transfers and wire payments) to the correct institution.
Format: 9 digits, numeric only.
Example: 021000021 (JPMorgan Chase, New York).
ABA routing numbers are used exclusively inside the US banking system. For payments to or from Switzerland, the IBAN and BIC/SWIFT code play the equivalent routing role.
The legal requirement to keep financial records and prepare accounts.
In Switzerland the obligation is set by the Code of Obligations and scales with size. Sole proprietorships and partnerships with annual turnover below CHF 500,000 keep simplified accounts (income, expenses and asset position), often called comptabilité simplifiée. Above that threshold, and for all companies entered in the commercial register such as an SA or Sàrl, full double-entry accounting with annual accounts is required.
Accounting records must be kept for ten years.
Amounts a company owes its suppliers for goods or services bought on credit. They appear under current liabilities on the balance sheet.
In bookkeeping, a supplier invoice creates a payable when it is recorded, and clears it when paid. The gap between the two is what a cash flow forecast depends on, and the aged payables list is how a fiduciary sees what is falling due.
Amounts customers owe the company for goods or services already delivered. They appear under current assets on the balance sheet.
A customer invoice creates a receivable when it is issued, and clears it when the payment arrives. Matching incoming payments to the right invoice is reconciliation, which is why structured references such as the QR reference exist.
Receivables that are unlikely to be collected must be written down, since Swiss accounting requires assets to be stated prudently.
An automated bank arrangement that moves balances between accounts at the end of each day, so that funds end up where they are needed.
Typically, surpluses are swept up to a main account and deficits covered from it, leaving subsidiary accounts at a target balance, often zero.
The purpose is to avoid holding idle cash in one account while paying overdraft interest on another.
The Automated Clearing House: the US network for processing high volumes of electronic credit and debit transactions in batches.
Identified by: a nine-digit ABA routing number plus the bank account number.
Used for payroll, direct deposit, utility bills, mortgage payments and government transfers. ACH suits recurring and batch payments rather than urgent ones, since transactions settle in batches rather than instantly.
The VAT that a recipient in Switzerland must declare itself when it buys services from a foreign business that is not registered for Swiss VAT. The tax liability shifts from the supplier to the recipient (the EU calls this reverse charge).
What it covers: mainly services such as consulting, advertising, software licences, IT and legal services. A few special cases also apply: work on Swiss real estate by a foreign business, supplies of electricity and gas, and (since 2025) emission certificates.
Who declares it:
Rate (2026): usually 8.1% (standard rate) on the invoiced amount, converted into francs.
What it changes in practice:
Example: a fiduciary buys CHF 2,000 of consulting from a German firm, with no Swiss VAT on the invoice: CHF 162 of acquisition tax. Effective method: CHF 162 declared and deducted. Net tax rate method: CHF 162 of cost.
Good to know: if the supplier is listed in the UID register (uid.admin.ch) and charges Swiss VAT, no acquisition tax is due.
Known in French as impôt sur les acquisitions and in German as Bezugsteuer.
The default VAT reporting basis in Switzerland: VAT is declared for the period in which the invoice is issued, regardless of when the customer pays.
The practical consequence is that a business owes the VAT on an invoice before the money arrives, and carries it until the customer settles. Input VAT follows the same logic: it is deducted for the period in which the supplier's invoice is received, not when it is paid.
This reporting basis can be combined with any of the reporting methods (effective, net tax rate, flat tax rate).
Also known as: the agreed consideration method. Comparable terms elsewhere: accrual basis or invoice basis. The Swiss term refers only to when VAT is declared, not to how the books are kept.
Known in French as contre-prestations convenues, and in German as vereinbarte Entgelte.
Old-age and survivors' insurance, the first pillar of the Swiss social security system. Despite the English name, it covers old age and survivors; disability (IV/AI) and loss of earnings (EO/APG) are collected alongside it.
Rate (2026): 10.6% of gross salary for AHV, IV and EO combined, split equally between employer and employee at 5.3% each. There is no upper salary ceiling: the contribution applies to the whole salary.
Self-employed people pay their own contributions at a maximum of 10.0%, on a sliding scale for income below CHF 60,500.
Contributions are mandatory from the first franc of salary, and the employer is responsible for declaring and paying both shares to the compensation fund.
An Account Information Service Provider: a third party licensed to read a customer's bank account data, with their consent, but not to move money.
This is the licence behind account aggregation apps, budgeting tools and the automatic import of transactions into accounting software. Under PSD2 an AISP registers rather than holding a full payment institution licence, which is a lighter regime than that applying to PISPs.
Unemployment insurance, which provides income support to people who lose their job.
Rate (2026): 2.2% of gross salary, split equally between employer and employee at 1.1% each, on salary up to CHF 148,200 a year.
Unlike AHV, the contribution is capped: no contribution is due on salary above CHF 148,200.
The year-end financial statements that present a company's financial position and performance.
Under Swiss law they comprise three parts:
Larger companies must add a cash flow statement and a management report. The accounts are approved by the shareholders' meeting and form the starting point for the tax return.
An Application Programming Interface: a defined way for one piece of software to request data or actions from another, without a person in between.
An API sets out what can be asked, in what format, and what comes back. That contract is what allows systems built by different companies to work together reliably.
In finance, APIs are what replaced file downloads and manual re-entry: instead of exporting a statement and importing it elsewhere, one system queries another directly.
A provider that connects to many banks and exposes them through a single interface, so that a software company integrates once instead of bank by bank.
The aggregator absorbs the differences between institutions: varying API standards, authentication flows, data formats and coverage. Without one, supporting twenty banks means twenty integrations to build and maintain.
The trade-off is a dependency and a cost per connection, against the engineering effort saved.
The resources a company owns and expects to draw economic benefit from. They appear on the left side of the balance sheet.
Swiss accounting splits them in two:
Total assets always equal liabilities plus equity.
An independent professional who reviews and verifies a company's financial statements, giving an opinion that the accounts present a true picture.
Switzerland distinguishes two levels. An ordinary audit applies to companies that, in two successive financial years, exceed two of three thresholds: CHF 20 million total assets, CHF 40 million turnover, or 250 full-time employees on annual average. Everyone else falls under a limited audit, which is lighter in scope.
Companies with fewer than ten full-time employees on annual average may waive the audit entirely, with the agreement of all shareholders. This is known as opting out and is common among Swiss SMEs. Conversely, shareholders representing at least 10% of share capital can demand an ordinary audit, known as opting up.
Associations are subject to lower thresholds for an ordinary audit: CHF 10 million total assets, CHF 20 million turnover, or 50 full-time employees on annual average.
Banking as a Service: licensed banks providing their regulated infrastructure to non-banks, so that another company can offer accounts, cards or payments under its own brand.
The bank holds the licence and carries the regulatory obligations, while the partner owns the customer relationship and the interface. A retailer offering a branded card is usually doing so on a BaaS arrangement rather than holding a banking licence itself.
Bankers' Automated Clearing Services: the UK system for direct debits and credit transfers between UK bank accounts.
Identified by: no code of its own; payments are addressed with a six-digit sort code and account number.
Commonly used for salary payments, bill payments and government disbursements. BACS runs on a three-working-day cycle, which is why urgent UK payments go through Faster Payments or CHAPS instead.
A financial statement presenting what a company owns and owes at a specific date, usually the close of the financial year.
It has two sides that always balance:
Unlike the income statement, which covers a period, the balance sheet is a snapshot at one moment. It is one of the three parts of the Swiss annual accounts, alongside the income statement and the notes.
An interface published by a bank that lets authorised external software query account data or submit payments directly, rather than through file transfer or a web portal.
In Switzerland, most bank APIs are reached through bLink, the SIX platform that standardises the connection, so a software provider integrates once rather than separately with each bank.
For accounting work, a bank API is what makes transactions appear automatically, where EBICS or camt.053 downloads require a file to be fetched and imported.
A report from a bank listing all transactions on an account over a given period, with the opening and closing balances.
For bookkeeping, the statement is the source document reconciled against the ledger: every entry on it should correspond to a booked transaction, and anything unmatched points to a missing or duplicated entry.
Statements are delivered on paper, as PDFs, or as structured camt.053 files, which accounting software can import and reconcile automatically.
The date on which a transaction is officially recorded in the account ledger.
It can differ from the value date because of processing delays or bank cut-off times: a payment made late on Friday may be booked on Friday but only take value on Monday.
In a camt.053 statement, the booking date is what determines which statement period an entry appears in, which makes it the date accounting software generally posts against.
The Bank State Branch number: a six-digit code identifying a bank and branch for domestic payments in Australia.
Format: 6 digits, usually written XXX-XXX.
Example: 082-900 (National Australia Bank).
Used with the account number to route funds within Australian payment systems.
Note: the hyphen is a writing convention only. The BSB itself is six digits: 082900.
Occupational pension provision, the second pillar of the Swiss system. It supplements the first pillar so that together they maintain an accustomed standard of living in retirement.
Key figures (2026):
Contribution rates rise with age, from 7% of coordinated salary for younger employees to 18% for the oldest band. The employer must pay at least half.
The coordination deduction weighs disproportionately on part-time and low salaries, since it is subtracted in full regardless of workload.
A family of ISO 20022 XML messages used for cash management and account reporting, sent by banks to their corporate clients.
Bringing the balances of several accounts together into one, physically or notionally, to manage the total rather than each account separately.
It improves interest terms and gives a single view of available cash. Notional pooling is restricted or unavailable in some jurisdictions.
A measure of how closely a cash forecast matched what actually happened, usually expressed as the variance between forecast and actual over a period.
It matters because decisions rest on the forecast: how much to keep liquid, whether to draw on credit, when to invest a surplus. A forecast that is consistently wrong in the same direction points to a fixable assumption, often customer payment behaviour.
The management of a company's cash: knowing what is available, where it sits, and making sure obligations can be met without holding more idle cash than necessary.
It spans monitoring balances across accounts, forecasting inflows and outflows, covering shortfalls and placing surpluses.
For a small company this is a weekly look at the bank balance. For a group with subsidiaries it becomes a structured discipline with dedicated tools, which is where most of the terms in this section come from.
An organisational model in which one central function manages cash, financing, foreign exchange and risk for an entire group, rather than each entity doing so itself.
The benefits are negotiating power with banks, netting across entities, and one consolidated view of exposure. The cost is a layer of coordination and intercompany arrangements.
This is a model for groups with multiple entities, not for a single company.
The Clearing House Interbank Payments System Unique Identifier: a code identifying US banks within CHIPS, a large-value payment system.
Format: 6 to 9 digits.
Example: 000123456 (illustrative).
Used mainly for large US dollar wire transfers between financial institutions.
A twelve-digit code identifying bank branches in China's national payment system, the China National Advanced Payment System (CNAPS).
Format: 12 digits.
Example: 123456789012 (illustrative).
Required for domestic RMB clearing and transfers within China.
The official public record of companies and legal entities in Switzerland, maintained by each canton.
Registration gives a company legal personality and makes its key details public: legal form, registered office, purpose, share capital and the people authorised to sign on its behalf.
Companies such as an SA or Sàrl must register. Sole proprietorships only have to register once annual turnover exceeds CHF 100,000. Each registered entity holds a unique business identification number (IDE/UID), which also serves as its VAT number.
The processes by which a customer grants, reviews and withdraws permission for a third party to access their financial data or initiate payments.
Consent must be explicit, limited to a defined scope and duration, and revocable at any time. Under PSD2 an access consent is time-limited and must be renewed, which is why aggregation connections periodically stop and require the customer to re-authenticate.
Good consent management means the customer can see at a glance who has access to what, and end it in one step.
A credit facility a bank makes available up to an agreed ceiling, which a company draws on as needed and repays, paying interest only on the amount used.
For a business it is a buffer against timing gaps: covering supplier payments and salaries while waiting on customer receipts, without borrowing a fixed sum in advance.
Common forms include an overdraft on a current account and a committed revolving facility.
The right of individuals to obtain their personal data in a structured, commonly used and machine-readable format, and to have it transferred to another provider.
In the EU it is established by the GDPR. Switzerland's revised Federal Act on Data Protection, in force since September 2023, introduced an equivalent right.
Applied to banking, data portability is the principle behind being able to take your transaction history with you when you change provider, rather than leaving it behind.
What a company owes to third parties. Liabilities appear on the right side of the balance sheet, alongside equity.
In everyday use, "debt" tends to mean borrowed money specifically, while "liabilities" covers every obligation, including unpaid invoices.
The standard method of calculating Swiss VAT: the business applies the statutory rates to its taxable turnover and deducts the input VAT charged on its purchases and investments.
It is the only method that recovers input VAT at its exact amount. Every deductible purchase must therefore be backed by a compliant invoice and booked with its VAT amount.
Filing frequency (2025): returns are filed quarterly. Since 1 January 2025, businesses with annual turnover of no more than CHF 5,005,000 can opt for an annual return, with three instalments during the year.
The alternative is the net tax rate method, which trades this precision for simplicity. The effective method usually suits businesses whose input VAT is high relative to turnover, for example because of large investments or purchases of goods.
It is independent of the reporting basis: a business on the effective method reports on either agreed or received consideration.
Known in French as the méthode effective and in German as the effektive Abrechnungsmethode.
Financial services offered inside a non-financial product, at the moment they are needed, rather than through a separate bank or provider.
Examples include paying in instalments at an online checkout, insurance offered during a booking, or an accounting tool that lets a business pay a supplier invoice without leaving the software.
Embedded finance is what BaaS infrastructure is generally used to build.
The share of social insurance contributions deducted from the employee's gross salary.
For 2026 these are AHV/IV/EO at 5.3%, ALV at 1.1% up to CHF 148,200, at most half of the BVG contribution, and, depending on the employer, shares of daily-sickness and non-occupational accident insurance.
The employer withholds these amounts and pays them to the relevant funds together with its own share.
The share of social insurance contributions borne by the employer, on top of the gross salary paid to the employee.
For 2026 this includes AHV/IV/EO at 5.3%, ALV at 1.1% up to CHF 148,200, at least half of the BVG contribution, occupational accident insurance in full, and family allowance contributions, which vary by canton.
In total, employer contributions typically add somewhere between 15% and 20% on top of gross salary. That is the gap between what an employee costs and what their contract says.
The owners' residual interest in the business: what would remain if every asset were realised and every liability settled.
Assets − liabilities = equity.
For a Swiss company it typically comprises share capital, legal and voluntary reserves, and retained earnings carried forward. Minimum share capital is CHF 100,000 for an SA, of which at least 20% of each share's nominal value must be paid in, subject to an absolute floor of CHF 50,000. For a Sàrl the minimum is CHF 20,000, fully paid in.
When liabilities exceed assets, equity turns negative. This is overindebtedness, which triggers specific duties on the board under Swiss law.
A cost incurred in running the business, recorded in the income statement and reducing profit for the period.
Common categories include rent, salaries and social charges, utilities, insurance, professional fees and office supplies.
An expense is distinct from an asset purchase: buying a laptop creates an asset that is depreciated over several years, while the monthly software subscription to run it is an expense in the period it relates to.
Collecting and consolidating financial data from several banks or sources, usually through APIs, into a single view.
For a company with accounts at three banks, aggregation is what produces one consolidated cash position instead of three separate logins. It is the service an AISP licence permits, and the foundation on which cash management and accounting tools are built.
Financial technology: the use of software and digital infrastructure to deliver financial services, often by companies outside traditional banking.
It covers payments, lending, investment, insurance, accounting automation and the open banking infrastructure connecting them.
The term describes an approach rather than a sector: established banks run fintech products too, and the line between a fintech and a bank with good software has largely stopped being useful.
A simplified VAT method reserved for public bodies and related institutions, including associations and foundations: a flat tax rate set per activity is applied to turnover, instead of deducting input VAT separately. Organisations that want to use it must notify the ESTV in writing.
It works like the net tax rate method, but is open only to these organisations, and with no turnover limit. Revenue must be booked separately for each approved flat tax rate, and invoices still show the statutory VAT rate, not the flat tax rate. Returns are filed quarterly, or annually with instalments, on application and subject to conditions.
Conditions (2025): a switch to the effective method is only possible after one full tax period. On switching to the flat tax rate method, input VAT previously deducted must be repaid, based on residual value. Group taxation is not available.
Known in French as the méthode des taux forfaitaires and in German as the Pauschalsteuersatzmethode. Not to be confused with the UK Flat Rate Scheme, whose closest Swiss equivalent is the net tax rate method.
The total remuneration owed to an employee before any deductions: base salary, plus any thirteenth month, bonuses, commissions and allowances subject to social contributions.
Gross salary is the figure stated in the employment contract and the basis on which every social insurance contribution is calculated. It is what appears at the top of the payslip, before employee contributions are subtracted to give net salary.
The International Bank Account Number: a standardised format for identifying bank accounts, designed to make international transfers reliable.
Structure:
Length: fixed per country: 21 characters in Switzerland, 22 in the UK, 27 in France.
Example: CH93 0076 2011 6238 5295 7.
An IBAN contains no information about the account holder's name or balance.
How IBAN compares with other bank codes
Note: the spaces in an IBAN are for readability only. In payment files and online forms it is written without them: CH9300762011623852957. The same applies to the spaces and dashes shown in the table.
The Indian Financial System Code: an eleven-character code identifying bank branches in India for electronic payments.
Format: 11 alphanumeric characters.
Example: SBIN0005943 (State Bank of India).
Required for NEFT, RTGS and IMPS transfers in India.
A statement summarising revenue, expenses and the resulting profit or loss over a period, typically the financial year. Also called the profit and loss account.
Where the balance sheet is a snapshot at one date, the income statement covers the span between two such dates, and explains how equity changed over it.
Swiss law allows two presentations: by nature, grouping expenses by type such as salaries and rent, or by function, grouping them by activity such as production and administration. Most Swiss SMEs use the presentation by nature.
The right of a VAT-registered business to deduct the VAT it paid on business purchases from the VAT it collected on its sales, so that only the difference is paid to the ESTV.
This is what makes VAT a tax on final consumption rather than a cost at every stage of the chain. A business buying CHF 10,000 of supplies plus CHF 810 of VAT can set that CHF 810 against the VAT it owes.
Input VAT can only be deducted where the purchase serves the taxable business activity, and where a compliant invoice shows the supplier's VAT number and the tax amount. Businesses using the net tax rate method do not deduct input VAT separately, since the net tax rate already accounts for it.
Cash available to a company during the business day, as distinct from the closing balance.
A company may end the day comfortably positive yet be short at eleven in the morning, when a large payment leaves before customer receipts arrive. Intraday liquidity is about having funds at the moment each payment must settle.
Real-time payments and intraday reporting through camt.052 have made this easier to monitor.
An international, XML-based messaging standard for exchanging financial data between banks and their clients. It covers payments, account reporting, securities, trade services, cards and foreign exchange.
ISO 20022 replaced a patchwork of national and proprietary formats with one structured standard, carrying far more detail per transaction than the older SWIFT MT messages. That richer structure is what makes automated reconciliation possible.
Switzerland migrated its domestic payment traffic to ISO 20022 between 2018 and 2022, retiring the old DTA and ESR formats. CAMT, PAIN and SEPA messages are all ISO 20022.
The older family of SWIFT message types for international payment instructions and reporting, now being replaced by ISO 20022 messages.
SWIFT began migrating cross-border payments from MT to ISO 20022 in 2023. Many banks still offer MT940 alongside camt.053, but it carries less detail, which is why reconciliation is generally more reliable from camt.053.
The amount actually paid to the employee, after the employee's share of social contributions and any source tax has been deducted from gross salary.
Typical deductions are AHV/IV/EO at 5.3%, ALV at 1.1%, the employee's BVG share, and accident and daily-sickness insurance premiums. Net salary generally lands between 83% and 88% of gross, varying with age and pension plan.
A simplified VAT method, available on application to the ESTV, under which a fixed industry rate is applied to gross turnover instead of deducting input VAT separately.
Conditions: annual turnover from taxable supplies of no more than CHF 5,024,000 including VAT, and tax due of no more than CHF 108,000 a year. Because of the tax limit, the turnover ceiling is lower for the higher rates, for example about CHF 1.59 million at 6.8%.
There are ten rates, set by sector, from 0.1% to 6.8% (2026). Each is set to approximate the input VAT a typical business in that sector would reclaim. Returns are filed semi-annually rather than quarterly, which is the main administrative saving.
Invoices still show the statutory rate of 8.1%, not the net tax rate. Known in French as the méthode des taux de la dette fiscale nette and in German as the Saldosteuersatzmethode. It should not be confused with the flat tax rate method (Pauschalsteuersatz), which is reserved for public bodies and related institutions, including associations and foundations.
Comparable abroad: the UK Flat Rate Scheme, which also applies a sector percentage to VAT-inclusive turnover instead of reclaiming input VAT. Despite the similar name, it does not correspond to the Swiss flat tax rate method.
The body set up in 2016 by the UK Competition and Markets Authority to create open banking standards for the nine largest British banks.
It produced the Open Banking Standard, one of the first detailed API specifications of its kind, and influenced open banking design well beyond the UK.
OBIE was succeeded in 2022 by Open Banking Limited, which continues the work. The term still appears in older documentation.
The practice of banks opening access to account data and payment initiation to licensed third parties, with the customer's explicit consent, through secure APIs.
In the EU it is mandated by PSD2: banks must give authorised providers access to payment accounts. Switzerland took a different route. There is no equivalent legal obligation, and access is market-led, developed through bLink, the SIX platform through which Swiss banks expose standardised interfaces to software providers.
For a fiduciary, the practical consequence is that bank data can flow automatically into accounting software instead of being downloaded and imported by hand.
The extension of open banking principles beyond payment accounts, to savings, pensions, insurance, mortgages and investments, so that a customer can authorise access to their full financial picture.
In the EU this is the aim of the proposed Financial Data Access framework (FiDA), still in negotiation. Open banking covers the current account; open finance would cover everything else.
The first balance sheet of a company, drawn up when it is founded, showing its assets, liabilities and equity at that moment.
For a Swiss SA or Sàrl it records the capital contributed by the founders, whether in cash or in kind, and is a required part of the incorporation file.
It also sets the baseline against which every later financial statement is compared.
A family of ISO 20022 XML messages used by companies to send payment instructions to their bank. The counterpart of CAMT messages, which flow the other way.
The Primary Account Number: the number printed on a credit or debit card, identifying the card account.
Format: 13 to 19 digits.
Example: 4111 1111 1111 1111 (Visa test card).
Used worldwide for card payments and transaction processing.
Note: the spaces mirror how the number is printed on a card and are not part of it: 4111111111111111.
A centralised function that executes all of a group's outgoing payments, instead of each entity paying from its own accounts.
Entities submit payment requests, and the payment factory validates, batches and transmits them to the banks, typically as pain.001 files or through a bank API.
The gains are consistency of controls, fewer bank connections to maintain and lower transaction costs.
The channels a company uses to exchange payment files (such as pain.001) and account statements (such as camt.053) with its bank.
A broad term for the infrastructure and mechanisms that move funds between parties.
It covers:
These systems are overseen by central banks and regulators. In Switzerland, SIX Interbank Clearing operates the domestic system on behalf of the Swiss National Bank.
The payslip: the document an employer must give each employee setting out how their pay was calculated.
It shows gross salary and its components, each social contribution deducted with its rate, any source tax, and the resulting net amount. Employer contributions are often shown alongside for transparency, though they are not deducted from the employee.
Swiss law requires employers to provide a written statement of account for each pay period.
Payment Initiation Service: the regulated service, defined by PSD2, by which a third party initiates a payment on a customer's behalf, directly from their bank account.
Example: paying an online invoice straight from a bank account through a third-party application, rather than entering card details.
Providers: PISPs such as Tink, Token or TrueLayer.
The appeal is cost and speed: the payment travels on bank rails, so there is no card interchange fee, and the merchant sees the funds sooner.
A Payment Initiation Service Provider: a third party licensed to initiate a payment directly from a customer's bank account, with their consent.
The customer authorises the payment in their own banking app, and the funds move by bank transfer rather than through a card network. Because no card scheme sits in the middle, fees are generally lower.
PISPs require a full payment institution licence, a heavier regime than the registration applying to AISPs, because they move money rather than only reading data.
The EU Payment Services Directive 2, in force since 2018, which created the legal basis for open banking in Europe.
It obliges banks to give licensed third parties access to payment accounts with the customer's consent, introduced the AISP and PISP licence categories, and imposed strong customer authentication on electronic payments.
PSD2 does not apply in Switzerland, which is not an EU member. Swiss banks open their interfaces by commercial agreement rather than legal obligation.
What comes next: PSD2 is being replaced by a package of two texts, the PSD3 directive and the directly applicable Payment Services Regulation (PSR). Co-legislators reached political agreement in November 2025 and the parliamentary committee approved the texts in May 2026, but formal adoption and publication were still pending, so PSD2 remains the operative framework. Application is expected around 21 months after publication.
A Swiss IBAN variant used exclusively for payments with the Swiss QR-bill. It is linked to a dedicated collection account and used with a structured QR reference, which lets the recipient reconcile incoming payments automatically.
Format: same structure as a Swiss IBAN, but the bank identifier (QR-IID) falls within the reserved range 30000-31999.
Example: CH44 3199 9123 0008 8901 2.
A QR-IBAN cannot be used for standard or international transfers, only for QR-bill payments.
Note: the spaces in a QR-IBAN are for readability only. In payment files and online forms it is written without them: CH4431999123000889012.
Payments that settle within seconds, at any hour, including weekends and public holidays, rather than in batches on working days.
Switzerland launched instant payments on 20 August 2024, on the SIC5 platform operated by SIX for the Swiss National Bank. Institutions that handled more than 500,000 incoming customer payments in 2020 had to be able to receive them from that date, covering over 95% of Swiss customer payments; the remaining institutions follow by the end of 2026.
An important nuance: receiving instant payments is compulsory, while sending them remains optional and is often charged. Elsewhere, the equivalent schemes are SEPA Instant in the euro area and Faster Payments in the UK.
The shift matters for reconciliation: when funds and the account statement arrive together, matching a payment to an invoice stops being an end-of-day exercise.
An alternative VAT reporting basis, granted by the ESTV on application: VAT is declared for the period in which payment is actually received.
The advantage is cash flow. No VAT falls due on an invoice until the customer has paid, so a business never advances the tax on unpaid invoices. This suits businesses that grant long payment terms or often face late payment. The counterpart is that input VAT can only be deducted once the supplier's invoice has been paid.
Like agreed consideration, it can be combined with any of the reporting methods (effective, net tax rate, flat tax rate).
Also known as: the received consideration method. The official English translation of the Swiss VAT law uses collected consideration. Comparable term elsewhere: cash basis. The Swiss term refers only to when VAT is declared, not to how the books are kept.
Known in French as contre-prestations reçues, and in German as vereinnahmte Entgelte.
Matching bank transactions to accounting entries automatically, rather than line by line.
Software compares incoming payments against open invoices using references, amounts, dates and counterparty names, clearing what matches and leaving only exceptions for a human.
Structured references are what make this reliable: a QR reference or an ISO 20022 end-to-end reference lets a payment be matched with certainty, where a free-text message requires guesswork. Automating reconciliation is typically the single largest time saving available in a fiduciary's bookkeeping work.
The total income generated by a company's business activities before any costs are deducted. Also called turnover, and the top line of the income statement.
Revenue matters beyond performance measurement, because several Swiss obligations are keyed to it: VAT registration from CHF 100,000 of worldwide taxable turnover, full double-entry accounting above CHF 500,000 for sole proprietorships and partnerships, and eligibility for the net tax rate method up to CHF 5,024,000 including VAT.
Revenue is recorded net of VAT, since VAT collected is owed to the ESTV rather than earned.
Regulatory Technical Standards: the detailed binding rules that specify how a piece of EU legislation must be applied in practice.
In open banking, the RTS on strong customer authentication and secure communication set out how SCA works, which exemptions exist, and what a bank's interface for third parties must do. They are drafted by the European Banking Authority and adopted by the Commission.
The distinction matters because the directive states the principle while the RTS determine what a provider actually has to build.
An isolated test environment that replicates a bank's or provider's API, using fictitious data, so developers can build and test an integration without touching real accounts.
Under PSD2, banks must make a testing facility available to third parties before going live. A sandbox is also how a software company validates an integration after a bank changes its interface.
The term is also used for regulatory sandboxes, where a supervisor lets firms test innovative services under relaxed conditions. The two meanings are unrelated.
Strong Customer Authentication: the PSD2 requirement that electronic payments and account access be confirmed with at least two independent factors.
The three categories are:
Two factors must come from different categories, which is why a password plus a security question does not qualify. Certain low-value or recurring payments are exempt.
The Single Euro Payments Area: an EU initiative that standardises euro-denominated bank transfers so that cross-border payments work like domestic ones.
It defines three main schemes:
SEPA covers more than 30 countries, including Switzerland, which participates for euro payments while keeping the Swiss franc outside the scheme.
The date on which the actual transfer of cash or securities is completed.
It follows the trade date, with the gap set by market convention: most stock markets settle two business days after the trade, written T+2. The United States moved to T+1 in May 2024.
The mandatory contributions funding the Swiss social insurance system, levied on salaries and shared between employer and employee.
They cover the first pillar (AHV, IV, EO), unemployment insurance (ALV), occupational pensions (BVG), accident insurance (UVG) and family allowances. Some are split equally, others fall wholly on the employer.
For the employer they are not simply a deduction but an additional cost: the real cost of an employee is their gross salary plus the employer's share.
A six-digit code identifying bank branches in the United Kingdom for domestic payments.
Format: 6 digits, usually written XX-XX-XX.
Example: 20-00-00 (Barclays).
Used for Faster Payments, BACS and CHAPS transfers in the UK.
Note: the dashes are a writing convention only. The sort code itself is six digits: 200000.
Tax withheld directly from salary by the employer and paid to the tax authority, instead of the employee filing an ordinary tax return.
In Switzerland it applies mainly to foreign workers without a C permit, and to cross-border commuters. The employer is responsible for deducting the right amount, using the scale of the canton concerned, and for paying it over.
Source tax should not be confused with withholding tax (impôt anticipé), which is levied on investment income and is a different tax entirely.
The Bank Identifier Code, also called SWIFT code: a globally unique code identifying banks and financial institutions for international transfers.
Format: 8 or 11 characters.
Example: DEUTDEFF (Deutsche Bank, Frankfurt).
Used alongside the IBAN to route cross-border payments to the right bank.
A Treasury Management System: software that consolidates bank balances, forecasts cash, executes payments and tracks financial risk in one place.
A TMS sits between the company's accounting system and its banks, and is what makes concentration, forecasting and a payment factory workable at scale.
Historically a tool for large corporates, though lighter cloud-based alternatives now serve smaller companies.
Replacing a sensitive value, such as a card number, with a substitute token that has no exploitable meaning outside the system that issued it.
When a card is added to a phone wallet, the device stores a token rather than the actual PAN. If the token is intercepted, it cannot be used elsewhere.
Tokenization reduces the scope of data a merchant must protect, since the real card number never reaches their systems.
A Third Party Provider: a company authorised under PSD2 to access bank accounts on a customer's behalf, without being the bank holding the account.
TPPs fall into two licensed categories, which a provider may hold either or both of:
TPPs are supervised and must be authorised by a national regulator before they can connect to banks.
The date on which a financial transaction, such as a stock or bond trade, is executed or agreed.
It marks the point at which contractual obligations begin between buyer and seller, even though the money and securities change hands later, on the settlement date.
The date on which funds are effectively credited to or debited from an account.
It determines when money actually becomes available, and when it starts or stops earning interest. A credit booked today with a value date two days out is visible on the statement but not yet usable.
The gap between booking date and value date is why a bank balance and an available balance can differ.
The Swiss consumption tax, levied on most goods and services. Known as MWST in German and TVA in French.
Rates since 1 January 2024:
Registration becomes compulsory once worldwide taxable turnover reaches CHF 100,000 a year. Below that, a business may register voluntarily, which can be worthwhile when it incurs significant input VAT.
VAT is a tax on the end consumer: a registered business collects it on its sales, deducts the VAT it paid on its purchases, and pays the difference to the ESTV.
Returns are filed quarterly under the effective method and semi-annually under the net tax rate method, each within 60 days of the end of the period. Since 1 January 2025, smaller businesses may opt for an annual return with instalments.
Every Swiss VAT return rests on two independent choices: when VAT is declared (the reporting basis) and how the amount owed is calculated (the reporting method).
1. When: the reporting basis
2. How much: the reporting method
Any reporting basis can be combined with any method. For example, a consultancy might report on received consideration under the net tax rate method, while a business with large purchases or investments usually stays on the effective method.
In practice, the reporting basis decides which documents drive the return: invoices issued and received, or payments received and made, as they appear on bank statements. The method decides whether input VAT has to be tracked invoice by invoice.
In French: mode de décompte and méthode de décompte. In German: Abrechnungsart and Abrechnungsmethode.
A sub-account defined within a real bank account, used to identify who a payment came from without opening a separate account for each.
Each customer or purpose is assigned its own virtual account number. Payments arrive in the single real account but carry the virtual reference, so they can be allocated automatically.
In Switzerland, the QR-IBAN with a structured reference achieves much the same reconciliation outcome by a different route.
A Swiss federal tax levied at source on investment income, principally dividends, bond interest and bank interest, as well as on lottery winnings and certain insurance benefits.
Rates: 35% on investment income and lottery winnings, 15% on life annuities and pensions, 8% on other insurance benefits.
Its purpose is to discourage undeclared income: a Swiss taxpayer who declares the income properly reclaims the tax in full, through the cantonal tax return for individuals or directly from the ESTV for companies. It therefore functions as a security deposit rather than a final charge. Residents abroad may reclaim part of it under a double taxation treaty.
Known in German as Verrechnungssteuer and in French as impôt anticipé. It is a different tax from source tax on salaries (Quellensteuer, impôt à la source), though English often renders both as withholding tax.
Reducing the cash tied up in day-to-day operations, by managing receivables, payables and inventory.
The three levers are collecting from customers sooner, holding less stock, and using supplier payment terms fully without paying late.
Each franc released this way is a franc that need not be borrowed, which is why working capital is often a cheaper source of funding than credit.