Subsequent insolvency is irrelevant to the valuation of an investment

A shareholder sold his stake in an unlisted public limited company to the sole shareholder for CHF 1. The tax authorities assumed a higher value and classified the difference as a benefit in kind subject to withholding tax.

The Federal Administrative Court upheld this decision: the value at the time of the sale is decisive. The company’s subsequent insolvency cannot be taken into account. As the company was still economically viable at the time, the shareholding was not worthless then.

Conclusion: A sale significantly below the actual value may give rise to a taxable benefit in kind. (Source: Federal Administrative Court A-8711/2025 of 18 June 2026)