Feb 2023


Law Over Borders Comparative Guide:

Private Client


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Contributing Firm


Politically and economically, Switzerland is one of the most stable countries in the world. It is a federal republic made up of 26 cantons, each of which has considerable autonomy in the areas of taxation, healthcare, social welfare, law enforcement and education; this creates a number of differences in local governance.

Switzerland has a population of almost 8.5 million. The country has four official languages (German, French, Italian and Romansh) and English is also widely spoken.

As is the case with most European countries, Switzerland is a civil law jurisdiction. The judiciary comprises of federal and cantonal courts. Each canton has its own courts of first instance and a second instance of appeal. The highest judicial authority is the Federal Supreme Court located in Lausanne, which is the final instance of appeal against decisions of: 

  • the cantonal courts of appeal; 
  • the Federal Criminal Court, located in Ticino; 
  • the Federal Administrative Court in St. Gallen; and 
  • the Federal Patent Court, also located in St. Gallen.

1 . Tax and wealth planning

The question of whether a person is obliged to pay taxes in Switzerland depends on whether they meet the requirements of tax residence. This applies if they have had an uninterrupted stay of at least 30 days in the country with professional activity or a stay of at least 90 days without professional activity. Unless a double taxation treaty specifically allocates the person’s tax residence to another state, they will then become subject to unlimited tax liability in Switzerland. This means that their worldwide income and wealth become subject to income tax at the federal, cantonal and municipal levels, and to wealth tax on the cantonal and municipal levels.

For Swiss tax residents, income tax is generally levied on all forms of income, for example, from employment, investment, pension or real estate (exceptions apply for income deriving from foreign real estate or business, capital gains on privately held assets (for example shares) and income constituting a repayment of nominal capital or qualifying capital contribution reserves in companies). The applicable tax rate depends on a number of factors. Income tax rates are progressive and vary depending on the canton and, within a canton, on the specific municipality of residence.

Further to the taxation of income and moveable and immoveable assets, Swiss tax residents are also subject to wealth taxation at the cantonal and municipal (but not federal) level. For taxation purposes, gross wealth may also be reduced by various deductions, such as for debt (e.g. mortgages) or, depending on the canton, certain tax-free amounts (e.g. social deductions).

As an alternative to the ordinary regime of income and wealth taxation, most cantons provide taxpayers the option of being taxed on their worldwide living expenses by way of lump sum taxation. Lump sum taxation is only available to persons who are not Swiss nationals, who do not exercise a professional activity in Switzerland and who have recently relocated to Switzerland or have not lived here during the past ten years. In a lump sum regime, the income tax basis is determined by a tax ruling that must be obtained from the cantonal tax authorities.

Persons not resident in Switzerland for tax purposes may nonetheless be subject to limited tax liability here if they have a specific economic nexus to the country (for example: permanent establishments in Switzerland; brokering in or ownership of Swiss real estate; exercising professional activities in Switzerland and so on). If limited tax liability applies, only a certain portion of income will be taxable in Switzerland. At a minimum, this will include the revenue earned from Swiss sources. However, as a general rule, a person’s global revenue will be used to calculate the applicable tax rate.

Other relevant taxes are inheritance tax and gift tax, which are levied at the cantonal and municipal level but not federally. The applicable tax rates and tax-exempt amounts vary between the cantons and depend on the relationship between the deceased/donor and the heir/donee. As a result, wealth and succession planning structures, such as trusts and foundations, still require individual assessment for tax purposes. For such structures, it would typically be appropriate to obtain a tax ruling from the competent cantonal tax authorities.


1.1. National legislative and regulatory developments

Revision of Swiss inheritance law

One of the most significant legislative developments is the revision of the Swiss inheritance law. The provisions of the first part of the revision came into force on 1 January 2023. The first part of the revision focused on increasing the testator's freedom of disposition by reducing the minimum share in the estate guaranteed by law to certain persons close to the deceased, the so-called forced heirship share. According to the new law, the descendants' forced heirship share is reduced to one half of their statutory share (instead of 3/4 as it currently stands), while the parents share was abolished completely. The entitlement of spouses and registered partners has remained unchanged. Due to this reduction or abolition of the compulsory shares, a testator can now freely dispose of at least half of the estate. Hence, there is more flexibility for favouring life partners or other persons or for allocating a larger share to specific heirs, whereby the relevant cantonal inheritance tax consequences must be considered when benefiting non-relatives.

A further change in Swiss succession law relates to the testator's freedom to dispose of their assets by way of lifetime gifts where the testator has concluded an inheritance pact. Under the new rules, testamentary dispositions and lifetime gifts – with the exception of occasional customary gifts – can be challenged by the contractual party to the inheritance pact if they are incompatible with the undertakings in the inheritance pact and such dispositions have not explicitly been reserved.

Moreover, since the revision, in cases where a spouse dies during ongoing divorce proceedings, the surviving spouse is no longer entitled to their forced heirship share, provided the proceedings have been initiated at the spouses' joint request or if they have been living separately for two years. Furthermore, spouses no longer have any inheritance claims during pending divorce proceedings based on former testamentary dispositions in last wills or succession pacts unless this has explicitly been stated. The spouses will, however, keep their statutory inheritance rights until the divorce is final. Therefore, a respective testamentary disposition is required if the testator no longer wants their spouse to benefit from the estate. 

The ongoing comprehensive reform of Swiss succession law may also have significant impact on trusts and foundations. The Swiss legislator has indicated reforms with regard to information requests of heirs and other interested persons towards foundations and trusts.

The reduction of the forced heirship shares of descendants means greater freedom to dispose of assets, which may make succession planning easier, for example, for entrepreneurs – particularly in situations where a family business constitutes either the largest portion of the estate, or at least a significant element of it. In a further step, the Federal Council plans to facilitate the succession for family businesses. The new rules should apply to a broad range of “companies”, i.e., to all forms of legal entities except pure investment companies and listed companies. The Federal Council signed off the dispatch on the new law for discussion in Parliament in June 2022. 

In light of the new provisions which entered into force on 1 January 2023, existing wills and succession pacts should be reviewed, also given the new planning opportunities in the event of a divorce.

Same-sex marriage

Another recent change in Swiss legislation concerns the provisions on same-sex relationships. Until 1 July, 2022, same-sex couples could only enter into a registered partnership, but not get married. The registered partnership confers certain rights that are comparable to marriage (for example, right to share a surname, right to inherit from their partner, right to be protected from termination in rental agreements, and so on) but differs with regard to important aspects such as the default marital property regime or the right to adopt.

As of July 1, 2022, same-sex couples are able to get married or have their registered partnership converted into a marriage. Since that date, same-sex couples can no longer enter into new registered partnerships. However, existing partnerships may continue to exist without any specific declaration.

This development has far-reaching consequences for the wealth planning of same-sex couples, as the rules concerning the matrimonial property regime changed. The previous ordinary matrimonial property regime of the registered partnership – the separation of property – is no longer applicable should the partners decide to convert their partnership into a marriage. From the time of conversion into marriage, the ordinary matrimonial property regime of the participation in acquired property applies. If the couple wishes to convert their registered partnership into a marriage but retain the regime of separation of property, a respective marital agreement must be concluded. If such an agreement already exists, it remains valid following the conversion of the registered partnership into a marriage. The registered partnership is, to a large extent, treated in a similar way to marriage from a tax perspective. Same-sex marriage is treated like traditional marriage from a Swiss tax perspective.

Registration of Swiss family foundations

Existing Swiss family foundations had to register with the commercial register by the end of 2020, and new ones are considered validly set up only if duly registered. Swiss family foundations remain, however, exempt from supervision and there is no statutory requirement for an auditor. The new registration requirement in Switzerland might be regarded as a further impediment for Swiss family foundations since their confidentiality privilege has now been removed. That said, Swiss law prevents Swiss family foundations from granting unconditional maintenance payments to members of a family over generations. Therefore, Swiss family foundations are not often used in the context of wealth and estate planning.

Revision of Swiss foundation law

Swiss foundation law has recently been reformed by a Parliamentary Initiative to strengthen the Swiss foundation sector. Originally intended as a moderate modernization dealing with particular issues (e.g., tax exemption for charitable foundations with remuneration for the members of the foundation board, collection of data of charitable foundations, simplifications to amend the organization after the establishment of the foundation), the consultation process quickly demonstrated the interest of the sector to initiate a broader reform, especially when taking into account the parallel intentions to create a genuine Swiss trust law. However, only a few provisions have been revised. Most notably, it will be possible to reserve the right to amend the foundation’s organization and minor amendments of the foundation deed shall be possible if they “appear justifiable on reasonable grounds”. These new provisions will enter into force on 1 January 2024.

Supervision of Swiss trustees

Switzerland is host to many trusts and many trustees operate in Switzerland. In recent years, and as a result of international trends towards transparency, the regulatory environment for trusts and trustees has significantly changed. The introduction of the Financial Institutions Act brought a new supervisory regime for trustees, portfolio managers, managers of collective assets, fund management companies and securities firms (see Section 2.1 below).


1.2. Local legislative and regulatory developments

As is the case with most continental European countries, Switzerland is a civil law jurisdiction. One of the most important pieces of Swiss legislation is the codification of private law in the Civil Code and Code of Obligations. Since all important issues are codified at the national level (for example, succession and family law), there are no noteworthy local legislative or regulatory developments to report.


1.3. National case law developments


Apart from the impact of CRS reporting (see Section 1.5 below), there have been court decisions relating to the place of effective management of foreign (often offshore) companies being in Switzerland due to the key decision-maker's place of residence and activity for the structure in Switzerland. With the place of effective management in Switzerland, Switzerland claimed taxation rights on the companies (e.g., underlying companies in trust structures).

Recognition of foreign family foundations

In a decision concerning a Liechtenstein family foundation from 2009, the Swiss Federal Supreme Court ruled that a foundation is recognized in Switzerland as long as it has been established in accordance with the applicable (in this case: Liechtenstein) law. The paradoxical result of this decision is that it is possible for a Swiss resident client to establish a Liechtenstein (dynastic) family foundation which allows for distributions to enhance the living standards of the beneficiaries, while a Swiss family foundation has to obey the strict rules. This situation has been criticized by some authors and it is anticipated that these aspects may be dealt with in upcoming reforms of Swiss foundation law.

Swiss divorce law

In a landmark decision of the Swiss Federal Tribunal of February 2021, the Federal Supreme Court abandoned the application of the so-called "45 rule". This rule meant that a spouse could no longer be expected to take up gainful employment if they had not worked during the marriage and had already reached the age of 45 at the time of the divorce. Now, it must always be assumed that gainful employment is reasonable, provided that such a possibility actually exists and there are no impediments, such as the care of small children. Parents who mainly took care of the children during the marriage and therefore did not pursue gainful employment are therefore forced to take up employment after the dissolution of the marriage, even at an advanced age.

Another recent decision of the Swiss Federal Tribunal of March 2022 also addresses the issue of post-marital maintenance. The Federal Supreme Court has ruled that – contrary to previous case law – the existence of joint children does not necessarily lead to a life-shaping marriage justifying post-marital maintenance.

Recent case law of the Swiss Federal Supreme Court further clarified the question of the binding nature of post-divorce maintenance payments agreed in prenuptial agreements. Swiss divorce courts are now bound to approve a respective agreement by the spouses, provided it is clear, complete and not manifestly unreasonable in light of the circumstances at the time of divorce.


1.4. Local case law developments

The judiciary comprises federal and cantonal courts. Each canton has its own courts of first instance and a second instance of appeal. The highest judicial authority is the Federal Supreme Court located in Lausanne, which is the final instance of appeal against decisions of: 

  • the cantonal courts of appeal; 
  • the Federal Criminal Court, located in Ticino; 
  • the Federal Administrative Court; and 
  • the Federal Patent Court, both located in St. Gallen. 

Therefore, similar to legislation, the important and fundamental decisions are to be found at the national level.


1.5. Practice trends

Relocation to Switzerland

Switzerland has a stable economy thanks to its highly developed professional services sector and thriving manufacturing and pharmaceutical industries. Competitive taxation levels both for individuals and corporations help to stimulate business and migration. The trend to move to Switzerland has increased during the pandemic. The reason for this increase in immigration seems to be that Switzerland took a liberal approach to the pandemic and tried to restrict citizens' rights as little as possible. Therefore, Switzerland seems to provide what the wealthy in particular are looking for: mobility as well as legal and financial security.

Tax litigation

While the Swiss tax landscape with its tax ruling system provides for a strong tool to avoid litigation and to increase legal certainty for taxpayers, tax litigation has slightly increased in recent years, mainly as a consequence of the transparency rules introduced globally. The same rules also fostered onshoring activities, to render the planning and handling of structures less complex.


1.6. Pandemic related developments

The impacts of the COVID-19 pandemic are wide-ranging and created not only social but also legal and commercial challenges. Due to Switzerland's approach to fighting the pandemic, coupled with the conditions already in place, more and more people are moving their center of life to Switzerland. This relocation to Switzerland is also favored by the trend to work remotely. Due to the pandemic, there has been a significant and sustained increase in employers' acceptance of remote working. Accordingly, there is no longer a need to live where one works.


2 . Estate and trust administration


2.1. National legislative and regulatory developments

Discussions are currently underway as to whether a new legal concept – the Swiss trust – should be introduced. However, the legislative process is still at an early stage. On 12 January 2022, the Federal Council opened the consultation on a first draft for a Swiss trust law. The proposal of the Federal Council provided that under certain circumstances a trust could be taxed as a foundation, i.e., as a separate legal entity. During the consultation it became clear that the proposed tax rules were met with criticism as they would eliminate both the established practice of the federal tax authorities as well as the discretion of cantonal tax authorities in a specific case at hand. From the authors’ points of view, discussions over the introduction of a Swiss trust should also include the current treatment of Swiss family foundations. It is yet unclear if, and how, Switzerland will introduce the concept of a Swiss trust.

Another development that will impact estate and trust administration is the newly introduced obligation to register trustees. On 1 January 2020, the new Financial Institutions Act (FinIA) came into force and with it the new supervisory regime for asset managers and trustees. The FinIA provides that anyone who acts as a trustee on a commercial basis must be licensed by FINMA. This only applies if various financial, organizational as well as personal terms are met. Trustees who have started their activities before 1 January 2020 should have applied for a license by the end of 2022. Those who started their activity as trustees in 2020 had to do so by 6 July 2021.


2.2. Local legislative and regulatory developments

As already mentioned, the important issues are regulated at the national level. Accordingly, reference can be made to Section 2.1 above.


2.3. National case law developments

Over the last few years, practice has also confirmed the importance for executors and trustees to diligently handle their tax-related duties. Particularly in cross-border situations, not only the proper handling of Swiss filing obligations for income and wealth tax as well as inheritance and gift tax purposes is crucial but also the adequate liquidity planning and handling of tax payments from the estate as well as by heirs in Switzerland and abroad has shown to be increasingly relevant. In this context, executors and trustees are required to issue suitable documentation for heirs and beneficiaries in order for them to meet their local reporting obligations.


2.4. Local case law developments

There have been no noteworthy local case law developments.


2.5. Practice trends

Cross-border estates and structures

A quarter of the Swiss population are not Swiss nationals and half of all marriages are binational. Due to this increasing internationalization, a clear trend towards cross-border estates is emerging, which in turn makes more comprehensive estate planning necessary.

Review of "older structures" 

The Automatic Exchange of Information (Common Reporting Standard (CRS)) and other cross-border reporting obligations imposed within the European Union (EU Council Directive 2011/16 in relation to cross-border tax arrangements (DAC6)) have become important driving forces, as cross-border structures in many cases are subject to reporting. Older and more complex structures have shown to be more exposed to suffer incorrect or multiple reporting within the automatic exchange of information.


2.6. Pandemic related developments

From a Swiss succession and tax planning perspective, the pandemic has increased the trend to plan residency and relocation more consciously and to consider aspects of infrastructure (e.g., medical system, schooling), environmental (e.g., access to recreational areas) and general systematic (e.g., stability, approach of government to crisis). 


3 . Estate and trust litigation and controversy


3.1. National legislative and regulatory developments

The concept of trusts is (as yet) alien to Swiss civil law. However, properly established trusts under foreign law are generally recognized in Switzerland as a matter of Swiss private international law (Switzerland is a signatory state of the Hague Trusts Convention). Nevertheless, the treatment of trusts in Switzerland continues to be defined by case law. However there has not yet been any precedent of the Swiss Supreme Court as regards the treatments of trusts in the context of Swiss succession.


3.2. Local legislative and regulatory developments

There have been no noteworthy local developments.


3.3. National case law developments

A difficult undertaking for heirs of settlors who pass away in Switzerland leaving assets in a trust that is unknown to the heirs is the information gathering process. In a decision of the Swiss Supreme Court in 2020, the Court clarified that heirs requesting information from Swiss banks with regard to trust accounts of which the deceased was a beneficial owner can only do so on the basis of Swiss succession law, but not contract law. This means that the heirs must show that the information is relevant for their inheritance claims (e.g., to determine forced heirship claims). In practice, this is often a cumbersome undertaking, as the heir is obviously lacking the necessary information to show the court why the sought information is relevant for their inheritance claim.


3.4. Local case law developments

There have been no noteworthy local developments.


3.5. Practice trends

In the context of cross-border estates planning, foreign trusts increasingly play a role, given that many testators are relocating to Switzerland with trust structures. Swiss law does not mention the concept of trusts and at the moment, they cannot be created under Swiss law. However, foreign trusts are fully recognised (see Section 3.1 above). As a result, trust-related disputes are on the rise. When disputes arise from situations involving trusts, they frequently involve the trustees. They are often the target of aggrieved beneficiaries or ex-spouses and can become involved in Swiss trust-related disputes, in particular in divorce and inheritance proceedings.


3.6. Pandemic related developments

The suspension of social life during the COVID-19 pandemic would suggest that there was less litigation due to fewer social contacts. However, the opposite is true. The frequency of disputes in private law has increased by about five percent overall in Switzerland during the last two years.


4 . Frequently asked questions

1. What are recent trends and developments you see in the market from a tax perspective?

We see a growing interest in relocation to Switzerland for (U)HNWI and their family members, among others due to the stable economic, fiscal and political environment and the solid infrastructure. Switzerland is perceived as a reliable hub to structure and plan family wealth and succession, with planning security in particular due to the possibility of discussing cases with the tax authorities and securing tax treatment within the framework of advance tax rulings.

2. Is it essential for an owner of assets in your jurisdiction to make a will in your jurisdiction? Does the will have to be governed by the laws of your jurisdiction?

When a Swiss-domiciled individual dies intestate, Swiss courts claim jurisdiction and apply Swiss inheritance law to the worldwide estate (except in relation to real estate located abroad, when the foreign state claims exclusive jurisdiction over real estate within its territory).

Under Swiss inheritance law, the deceased’s intestate estate passes to his/her statutory heirs. If an individual wishes to deviate from the intestacy rules, or if they want to appoint an executor, they should make a will. Foreigners living in Switzerland, can opt for the law of the state of their citizenship to govern their worldwide estate. 

If the deceased’s last domicile (as defined under Swiss law, i.e. the deceased had their vital interests in Switzerland) was not in Switzerland, the competent foreign courts have, in general, jurisdiction over the entire estate, including assets in Switzerland. However, if the foreign authorities do not deal with the deceased’s estate of a Swiss citizen living abroad, Swiss courts are competent to deal with the deceased’s estate and will apply Swiss succession law. Additionally, if a foreign national dies with their last domicile being abroad and leaves Swiss assets, the Swiss authorities are competent in relation to such Swiss assets if the foreign authorities do not deal with the Swiss assets. In such a case, the Swiss courts will apply the succession law designated under the conflict of law rules of the deceased's last domicile.

Therefore, although it is generally not necessary (and sometimes also not recommended, depending on the case in question) from a Swiss law perspective to make a separate will specifically for assets located in Switzerland, depending on the law at the place of the last domicile of the deceased, there may be situations where a specific will is necessary.




Craig MacIntyre
Grace Quinn


Adriane Pacheco
Beatriz Martinez
Humberto Sanches
Juliana Cavalcanti


Marilyn Piccini Roy

England & Wales

Bethan Byrne
Patrick Harney


Line-Alexa Glotin


Dr. Andreas Richter
Dr. Katharina Hemmen


Matt Guthrie


Lyat Eyal


Camilla Culiersi
Gian Gualberto Morgigni
Giovanni Cristofaro
Raul-Angelo Papotti


Tomoko Nakada


Sarajane Kempster


Johannes Gasser


Bilal Ajabli
Ellen Brullard
Eric Fort
Guy Harles


Mark McKeown
Paul Macaulay


Florentino Carreño

United States

Jonathan Byer
Joshua S. Rubenstein

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