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Caution with cash payments over CHF 15’000

Caution with cash payments over CHF 15'000

If large sums are paid in cash, caution is advised, especially in the construction industry. Recently, the VAT authorities have not accepted input tax deductions during inspections if only receipts for cash payments were available. The Federal Supreme Court has supported this decision.

In the construction industry, orders are often only carried out against cash payment, especially by subcontractors who are often only active for a short time and then file for bankruptcy. This makes it difficult for the tax authorities to check whether the VAT shown on the invoices has actually been paid. The tax authorities therefore refuse input tax deductions if payment is only proven with cash receipts.

It is advisable not to pay for services worth CHF 15’000 or more in cash but via bank accounts in order to avoid problems with the input tax deduction calculation.