Generally speaking, tax is calculated based on the taxpayer’s expenditure. The total expenditure must not be less than seven times the rental value of the taxpayer’s property, and must not fall below the minimum levels set by federal and cantonal legislation.
Additionally, it is necessary to compare the total taxable amount derived from expenses with the amount obtained on the basis of a number of factors involved in what is known as a control calculation. The higher of the two figures is taken as the taxable amount.
Some cantons differ from the others in requiring the lump-sum taxpayers to provide a list of their expenditure.
The level of expenditure related to direct federal tax, which constitutes the basis of roughly a third of the total tax, must not be less than CHF 400,000. Regarding communal and cantonal tax, which represents roughly the remaining two thirds, each canton fixes the minimum amount in its own legislation. In the main French-speaking cantons, the minimum level is CHF 400,000 in Geneva and Vaud, and CHF 250,000 in Valais.
It is important to note that cantons must also tax the wealth of the taxpayer, again in lump-sum form. This means that the minimum amount from which tax is calculated stands at CHF 440,000 and CHF 415,000 in the cantons of Geneva and Vaud respectively, taxed at the rate of income tax. For their part, the tax authorities in Valais have fixed a minimum amount of CHF 1,250,000, taxed not at the rate of income tax, but at the rate of wealth tax.
Therefore, the minimum amount of tax due is in the order of CHF 125,000 in Geneva and Vaud, and CHF 100,000 in Valais.