Switzerland: Personal Taxation
Inheritance taxes are levied at a cantonal level, and by all 25 cantons, except for the canton of Schwyz. Where a canton imposes both an inheritance tax and a gift tax the rates are normally identical. The right to tax inheritances belongs to the canton in which the deceased died domiciled. The tax is levied on the estate of the deceased and not on the heir. Inheritances received by a resident from abroad are not taxable. The basis of assessment to inheritance taxes is as follows:
- Deceased Residents: the estate is assessed to inheritance taxes based on the value of world wide estate (with the exception of real estate situate in a foreign jurisdiction);
- Deceased non-residents: the estate is assessed to inheritance taxes based on the value of real estate situate in Switzerland.
The rate of inheritance tax is progressive and is based on the relationship between the deceased and the heir - the closer the blood relationship the lower the inheritance tax levied, with the result that in some cantons transfers to children and the surviving spouse remain tax free whereas transfers to parties with whom there is no blood relationship are charged at the highest rates.
Gift taxes are levied at a cantonal level and are imposed by 24 out of the 25 cantons. Where a canton imposes both an inheritance and a gift tax the rates are normally identical. The right to tax gifts belongs to the canton in which the donor is domiciled. The tax is levied on the donor and not on the donee. The basis of assessment and the rates charged for gift taxes follow those for inheritance tax.