ETFs and taxes in Switzerland: the overview
Capital gains stay tax-free, but accumulated income is taxable too. Here's what to watch for with ETFs.
Distributing or accumulating: almost the same for tax
Distributing ETFs pay out dividends and interest regularly. Accumulating ETFs reinvest them inside the fund. Many people think that means no tax applies to the latter. That's not true: the accumulated income is taxable income too, even though nothing lands in your account.
The Federal Tax Administration determines what amount is taxable and publishes it in the price list (ICTax). Many ETFs report their income for this purpose. Before buying, check whether your ETF appears in the price list. Several comparison sites offer an overview of ETFs with this reporting.
Capital gains are tax-free
As with stocks, you pay no income tax as a private investor on capital gains from ETFs. You can't deduct losses. Anyone who trades very actively may be classed as a securities dealer; the criteria are in the stocks overview. A regular savings plan is far from that.
Wealth tax
ETF units count towards your taxable wealth, regardless of whether they distribute income. What matters is the tax value on 31 December. For ETFs in the price list you'll find it there per ISIN. If an ETF is missing, you need a documented value, such as the closing price on its home exchange, converted to francs.
Fund domicile and withholding tax
Where the fund is domiciled affects its tax treatment.
Swiss ETFs
Their income is subject to withholding tax, whether distributing or accumulating. You get it back if you declare correctly.
Foreign ETFs, for example from Ireland
Here, foreign withholding tax often already arises inside the fund, on the dividends of the stocks it holds. You don't see it on your statement and as an investor you generally can't reclaim it yourself. That's why DA-1 usually can't help with ETFs; more in the article Reclaiming foreign withholding tax.
Two similar ETFs can therefore perform differently after tax. That's a point worth checking before buying, alongside fees and index.
How to declare ETFs
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Get the tax statement
Most brokers provide a tax statement with quantity, tax value and income. Check whether accumulated income is included.
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Enter the ETF in the securities register
Enter ISIN, quantity and the tax value as of 31 December. For ETFs in the price list, tax software often pulls the income per unit itself.
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Declare the income
Distributions and accumulated income count as income. If the ETF is missing from the price list or it's unclear what to declare, ask your broker or the tax authority.
Frequently asked questions
Is an accumulating ETF better for tax?
In Switzerland both are similar for tax, because accumulated income is taxed too. The difference is more practical: with accumulating ETFs you have to set aside the tax money yourself, since no distribution arrives.
Do I have to declare an ETF with no distributions?
Yes. It counts towards your wealth, and depending on the ETF, accumulated income must also be declared.
Are custody fees deductible?
Asset management costs charged by third parties can sometimes be deducted, either as a flat rate or with receipts. Rules vary by canton.
Further reading: Stocks and taxes, Crypto and taxes and Broker comparison.