No lump-sum benefit for transfers to vested benefits accounts

In a Federal Supreme Court judgement, the issue was whether the transfer of pension assets from two pension funds to vested benefits accounts is considered a taxable lump-sum benefit. The cantonal courts held that the taxpayer had acquired the right to receive a lump-sum benefit through his partial retirement. However, the Federal Supreme Court clarified that the transfer of pension assets to vested benefits accounts is permitted and that this is not a due benefit, but only a future entitlement. This transfer is therefore not a taxable capital benefit.

The Federal Supreme Court also found that the payments made before partial retirement remained in the pension scheme. Therefore, the court – unlike the lower courts – did not see a breach of the three-year time limit. Tax avoidance was also denied, as the taxpayer had not withdrawn any funds from the vested benefits accounts. The mere possibility of determining the time of payment is not sufficient. The taxpayer’s appeal was upheld. (Source: BGE 9C_527/2023 of 27.6.2024)