Swiss Depreciation Rates for Self-Employed

For self-employed individuals in Switzerland, understanding depreciation rates is crucial for tax planning and asset management. The Swiss tax authorities recognize two main methods of depreciation, each with their own specific rates. This guide breaks down the official rates and helps you choose the right method for your business assets.

Understanding the Two Methods

Declining Balance Method

• Calculates depreciation based on the remaining value each year
• Provides higher deductions in early years
• More commonly used in Switzerland
• Better for assets that lose value quickly

Straight Line Method

• Calculates depreciation based on the original purchase price
• Provides equal deductions each year
• Simpler to calculate and track
• Better for assets that lose value steadily

Official Swiss Depreciation Rates

Declining Balance Method Rates

Straight Line Method Rates

(Half of declining balance rates)

Special Considerations

1. Energy-Saving Investments

   • Up to 50% can be depreciated in the first two years
   • Applies to qualifying energy-efficient improvements

2. Catch-up Depreciation

   • If maximum rates weren't used in previous years due to poor business performance
   • Can be recouped in subsequent profitable years

3. Cantonal Variations

   • Some cantons may apply different methods or rates
   • Always verify with your local tax authority

Choosing the Right Method

Consider these factors when selecting your depreciation method:

1. Asset Type

   • Fast-depreciating assets (like computers) → Declining balance
   • Stable-value assets (like buildings) → Straight line

2. Tax Planning

   • Need higher initial deductions → Declining balance
   • Prefer consistent deductions → Straight line

3. Administrative Effort

   • Simple tracking → Straight line
   • Willing to track changing values → Declining balance

Practical Tips

1. Stay consistent with your chosen method for similar assets
2. Document your depreciation calculations thoroughly
3. Keep records of original purchase prices and dates
4. Consider consulting with a tax professional for high-value assets
5. Review your depreciation strategy annually

Remember: While these rates represent the maximum allowed, you're not obligated to use the full rate. Choose a depreciation strategy that accurately reflects your asset's value decline while optimizing your tax position.