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.
