The companies which are primarily affected by the changes of the Capital Contribution Principle are those with Swiss individuals as shareholders (especially publically listed companies) as well as foreign-owned companies. The capital contribution reserves built up in the past will only be able to be agreed on once, i.e. in later years, retrospective declarations of privileged reserves will not be possible. Therefore, all corporations and cooperatives in Switzerland are, at least indirectly, affected. The impact of the Capital Contribution Principle should particularly be analyzed in detail where a company is loss-making, planning dividend distributions or in the process of a reorganization.
The assignment of capital contribution reserves to secure the privileged tax treatment is a one-off opportunity which should already be taken advantage in early 2011. As the change in law applies to all capital contributions since 31 December 1996, past corporate reorganizations such as mergers or demergers may result in future savings in the same way as past changes to the equity structure. Since the Swiss Federal Tax Authorities request apparently a disclosure under legal reserves in a single account, there might be need for action already today with regard to the upcoming general meeting for the business year 2010 in order that a transfer from free reserves to legal reserves can be completed if needed and the disclosure requirement in the balance sheet 2011 can be fulfilled as mentioned above.
KPMG's specialists are members of different committees and organizations, which means we are always up to date with the latest developments. We will gladly assist you with this important task, helping you to determine your company's tax-saving potential by using our specially developed methodology with respect to the Capital Contribution Principle.