Lowest corporate taxation for your headquarter

Source: Business Development LucerneYou are well advised to manage your international affairs from Lucerne. If your company generates more than 80% of its turnover and costs outside Switzerland it qualifies as a management company. The corporate tax rate of a management company lies between 8.5% and 11.5% (incl. 8.5% federal tax).

The chart below does compare the effective tax rate of the Canton of Lucerne with European competitors. The effective corporate tax burden is based on an investment theory approach for a manufacturing company (BAK Taxation Index, p. 8). This takes into account different types of financing, taxes on profits and on the capital invested and includes specific assumptions regarding write-downs and inventory valuations. For these reasons the tax rate for Lucerne differs from the tax rate of 12.2% specified on page 2 that only applies to corporate profits.

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Holding company

Holding companies are mainly involved in the administration of participations, which must comprise at least two thirds of the total assets or income. The activity of the group management also supports the task of the holding company. The holding company may hold trademarks and patents. The corporate tax department of the Canton of Lucerne decides whether a company qualifies as a holding company.

The holding company is only taxed on its capital. At 0.001 percent (at least CHF 500) the Canton of Lucerne has one of the lowest tax rates for holding companies in Switzerland. The profit of the holding company is tax exempt.