The Federal Court confirms that the preferential taxation of hidden reserves provided for in art. 37b LIFD (cessation of self-employed activity after the age of 55) applies not only in the case of actual and systematic realization of assets, but also in the case of book realization.
This is in line with the aim of the provision, which is to reduce the tax burden on the taxpayer in the context of the cessation of self-employment, in order to compensate the lack of pension a self-employed person typically suffers.
In this case, the taxpayer had terminated his self-employed activity by converting it into a limited company (tax neutral). In this context, he revalued certain assets for which, according to the Federal Court, he was entitled to claim preferential taxation. The fact that the taxpayer could also have carried out a transformation at book value (without revaluing assets), and therefore fully neutral, does not run counter to this analysis.
It should be noted that the Federal Court ruled on the appeal lodged by the Swiss Federal Tax Administration, against the decision of the Vaud Cantonal Tax Administration (confirmed by the cantonal courts) to grant the taxpayer the benefit of 37b LIFD.
