Contents
- When does VAT belong on the invoice?
- The three rates: 8.1 %, 2.6 % and 3.8 %
- Required details under Art. 26 of the VAT Act
- Inclusive or exclusive of VAT: a worked example
- Effective method or net tax rate: what changes on the invoice
- Rounding, currency and invoices in foreign currency
- VAT in Payvetia: what the app takes off your hands
- Frequent questions about VAT invoices
When does VAT belong on the invoice?
VAT belongs on your invoice only if you are registered as a taxable person with the Federal Tax Administration (FTA). Registration becomes mandatory when your turnover from taxable supplies reaches CHF 100,000 per year. Below that, you are exempt and issue invoices without VAT: no rate, no tax amount, no VAT number.
If you are under the threshold, you can register voluntarily, for instance to reclaim input tax on your own purchases. Whether that pays off depends on your industry and cost structure, and that is a question for your accountant. The conditions for tax liability and the current rates are published by the Federal Tax Administration.
What matters for the invoice is the effective date of your registration. From that day on you show VAT; before it, you do not. An invoice that shows VAT while you are not registered is more than a formatting slip: the tax you printed is owed to the FTA, even though you never had to charge it.
The three rates: 8.1 %, 2.6 % and 3.8 %
Since 1 January 2024, Switzerland has three VAT rates. The rate follows the supply, not your company. A design studio nearly always applies the standard rate, a bookshop the reduced rate, a hotel the special rate on overnight stays.
| Rate | Name | Typical supplies |
|---|---|---|
| 8.1 % | Standard rate | Services, consulting, trades, most goods |
| 2.6 % | Reduced rate | Food, books and newspapers, medicines |
| 3.8 % | Special rate for accommodation | Overnight stays including breakfast |
One invoice can carry several rates. A caterer bills the food at 2.6 % and the service at 8.1 %. In that case the tax amount is shown separately per rate, so the client and the FTA can see which share was taxed how. Which supply falls under which rate is governed by the VAT Act and its ordinances; when in doubt, the FTA's published practice or your accountant has the answer.
Required details under Art. 26 of the VAT Act
Art. 26 of the Swiss VAT Act defines what an invoice must contain so that your client can deduct input tax. A missing detail does not void the invoice, but it stops working as an input tax document for the recipient, and that is what triggers queries and corrected invoices. The six points:
- 1Supplier: your name or company, your address and your VAT number in the format CHE-123.456.789 MWST. It belongs in the invoice header, where nobody has to hunt for it.
- 2Recipient: the client's name and address as they appear in business dealings.
- 3Date or period: when the supply was made, if that differs from the invoice date. For monthly retainers the month, for projects the period.
- 4Type, object and scope: what was delivered, concrete enough for a third party to recognise it: not "services" but "concept and layout, annual report 2026, 24 pages".
- 5Consideration: the price of the supply, as line items and as a subtotal, in the currency of the invoice.
- 6Tax rate and tax amount: the rate applied and the resulting amount in francs. If the price is stated inclusive of tax, a reference to the rate is enough, such as "incl. 8.1 % VAT".
Inclusive or exclusive of VAT: a worked example
Between businesses, prices are usually quoted net and grossed up on the invoice. The example shows an invoice from Atelier Nordwand GmbH to Muster AG: three net line items, subtotal, tax at the standard rate and total.
| Line item | Amount |
|---|---|
| Concept and consulting, 8 h at CHF 150.00 | CHF 1'200.00 |
| Layout annual report, flat fee | CHF 850.00 |
| Image licences, recharged | CHF 200.00 |
| Subtotal excl. VAT | CHF 2'250.00 |
| VAT 8.1 % on CHF 2'250.00 | CHF 182.25 |
| Total incl. VAT | CHF 2'432.25 |
The tax is calculated once on the subtotal, not rounded per line and then added up; that avoids one-centime rounding differences. With private clients it often runs the other way: the price is agreed inclusive, and the VAT has to be extracted. To do that, divide the gross total by 1.081. CHF 2'432.25 becomes CHF 2'250.00 net, and the difference of CHF 182.25 is the VAT contained. For the reduced rate divide by 1.026, for the special rate by 1.038.
A common mistake is subtracting 8.1 % from the gross amount. CHF 2'432.25 minus 8.1 % gives CHF 2'235.24, a net figure almost 15 francs too low. Carry that into your VAT return and you report too little tax to the FTA.
Effective method or net tax rate: what changes on the invoice
Short answer: nothing. The invoice looks the same either way. You show the statutory rate, 8.1 %, 2.6 % or 3.8 %, and your client pays the same amount. The net tax rate is an industry rate you apply only in your return to the FTA, never on the invoice. A design studio with a net tax rate of 5.9 % still prints 8.1 % on every invoice.
The difference appears when you file. Under the effective method you report the VAT you collected and deduct the input tax on your purchases, usually every quarter. Under the net tax rate method you multiply your gross turnover by your industry rate and file twice a year; input tax is not tracked separately. Who may use the net tax rate and which rates apply is published by the FTA under net tax rates.
Which method works out cheaper for you depends on your input tax. Payvetia shows a preview for both methods in its reports, based on your actual invoices and expenses. That is not advice, but it gives you numbers rather than a hunch before you talk it through with your accountant.
Rounding, currency and invoices in foreign currency
The VAT amount is shown to the centime, meaning two decimals: CHF 182.25, not CHF 182.30. Rounding to 5 centimes applies to the total only, and only when it is paid in cash, because smaller coins do not exist. When paid by bank transfer or QR-bill, the total stays exact to the centime.
Invoices in euros or dollars are allowed; rate and tax amount are then stated in the invoice currency. Towards the FTA you still report in francs, converted at the exchange rates the FTA publishes for that purpose. Payvetia issues invoices in several currencies and keeps the CHF equivalent alongside, so the reports add up.
VAT in Payvetia: what the app takes off your hands
As soon as you enter your VAT number in your profile, it appears in the header of every invoice, quote and credit note. Each line item carries its own rate; the standard rate is preset, the reduced and special rates are one click away. If an invoice mixes several rates, the PDF shows the tax amount separately per rate, exactly as Art. 26 requires.
The app does the arithmetic: subtotal, tax per rate and total incl. VAT are calculated from the line items, without rounding differences and without a spreadsheet formula. The QR payment part picks up the total automatically. In the reports you see your turnover by rate and the preview mentioned above for the effective method and the net tax rate.
Invoices without VAT are available on the free plan; your first 3 documents are free. Documents that show VAT are part of Payvetia Pro, in the browser and in the iOS app, from CHF 29 per month or CHF 250 per year.
Frequent questions about VAT invoices
Under Art. 26 of the VAT Act it carries your name, address and VAT number, the client's name and address, the date or period of the supply, a concrete description, the consideration, and the tax rate and tax amount. No particular layout is prescribed; what counts is that every detail is complete and legible.
