News Value Added Tax

Intermediary Services in the Financial Sector

The recent decision of the Swiss Federal Administrative Court (A-3283/2024 of 5 December 2025), involving an additional VAT assessment in the six-figure range, once again demonstrates how important it is to clarify the VAT treatment of intermediary services in the financial sector in advance, in order to avoid subsequent corrections in the course of a VAT audit. This applies even where the additional assessment was not based exclusively on a different qualification of the intermediary services by the Swiss Federal Tax Administration (SFTA).

In the course of a VAT audit, the SFTA determined, among other things, that the taxable person had treated turnover generated from the recording and forwarding of customer orders to a bank as VAT-exempt. However, the SFTA qualified these transactions as taxable at the standard rate and levied additional VAT of a total of CHF 163k for the tax periods under review.

In this case, all parties appear to be resident in Switzerland and the input tax deduction does not appear to be significant. If high amounts of input tax had been claimable as a result of the activity now being classified as taxable, the additional assessment would not have had the same financial impact.

In the case of the same activity performed for a bank domiciled abroad, it would even be advantageous for the taxable person if the activity were classified as taxable from a Swiss VAT perspective, since no VAT would be due irrespective of the qualification, while input tax could be claimed in the case of a service that is in principle taxable.

Accordingly, in the case of intermediary services in the financial sector, it is advisable to clarify as early as possible whether the activity actually constitutes an intermediary service within the meaning of the practice of the Swiss Federal Tax Administration (SFTA):

Independent intermediary activity
Acting to bring about the conclusion of a contract without being a party thereto and without having any own interest in the content of the contract
The intermediary service must be distinct from the contractual services of the parties
Reference to individual transactions

In particular, intermediary activities must be distinguished from advisory services, the outsourcing of a task to a third party, and so-called finder’s fees (without a direct link to an individual transaction). As these activities are generally taxable, the distinction is relevant for VAT purposes where the underlying transaction is VAT-exempt.

The VAT treatment of an intermediary service is generally determined by the VAT treatment of the underlying transaction. That is, where an intermediary service relates to a taxable transaction, the service is in principle taxable, irrespective of whether it qualifies as advisory services, a finder’s fee, or the intermediation of a taxable service.

In practice, the possible constellations are diverse and the distinction between an intermediary service and other services is often fluid. There is frequently room for interpretation. It should therefore be examined in each case whether the facts are sufficiently clear or whether a ruling should be requested from the Swiss Federal Tax Administration. As illustrated above by the variant involving a foreign bank, the potential amount of any additional VAT assessment also varies depending on the specific circumstances.

For further information or individual advice, please contact Matthias Höhn, Manager VAT, under matthias.hoehn@fineac.ch.

WHAT we do is not unique, but HOW we do it!

Matthias Höhn, January 2026