Tax Ordinance (StV) - Church Tax (Art. 2 Church Tax Act) (STV)

1. Natural persons pay income and wealth taxes to the parish of their denomination. Upon joining or leaving the church, the affiliation at the end of the year is decisive for the tax liability for the entire tax year.

1. The Cantonal Parliament establishes the tax rate according to Art. 3 para. 2 lit. a of the Tax Law during the budget deliberations.

1. The Status of Registered Partners under the Federal Act on the Registered Partnership of Same-Sex Couples of June 18, 2004, corresponds in this regulation to that of spouses.

1. An actual separation of the marriage is considered to exist if the joint household has been dissolved, there is no longer a sharing of resources for housing and maintenance between the spouses, and any support provided by one spouse to the other is rendered only in fixed amounts.

1. The benefits in kind received by employees are assessed at market value. They are generally valued according to the rates applicable to direct federal taxes.

2. The withdrawal of goods and services from one's own enterprise for the taxable persons, the persons they support, and the employees are accounted for at cost.

1. In the case of commercial bookkeeping, a capital gain is the profit that exceeds the income tax value.

2. If no commercially maintained books are present, the capital gain is calculated based on the difference between the proceeds and the reported cost of acquisition. Tax-deductible depreciations are deducted from the cost of acquisition.

3. When transferring elements of business assets to private assets, the actual market value is considered the definitive transfer value. For real estate, the official market value serves as the base value. For commercially used properties, the stipulated official market value is used, while for residential properties, the official estimated market value increased by 15% is applied; if a current valuation is not available, the owner or the tax authority may request a revaluation; upon the owner's request and at their expense, the tax authority will obtain an appraisal of the market value for residential properties, which will be applied without a surcharge.

4. When transferring a property subject to agricultural land law into private assets, the selling price that can be realized in good faith at the time of transfer is decisive. If it appears probable, due to leasing, that the farming operation will later be resumed by the farm operator or a direct descendant, the agricultural property may, upon the taxpayer's request, remain in the business assets against a revers. The transfer to private assets can be deferred, provided the property remains subject to agricultural land law and there is a serious expectation it will later again be used agriculturally by the owner or a direct descendant. A revers can typically be agreed for the initial lease term. If the aforementioned conditions continue to be met after the initial lease term, the revers can exceptionally be extended for a maximum of up to 15 years from the start of the lease.

1. Income from movable assets includes all returns on assets that accrue to the beneficiary, specifically through payment, transfer, credit, or settlement.

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3. The income is attributed to the year's income in which the taxpayer obtains a legal claim to it. Article 23, Paragraph 1, Letter c, 2nd Sentence of the Taxation Act remains reserved.

1. The following are considered as taxable gross rental income from real estate

a) rental income, including rent reductions granted to the caretaker for labor performed;

b) all tenant reimbursements for incidental costs, excluding payments for heating, water, cleaning, etc., insofar as they do not exceed the landlord's actual expenses.

2. To compensate for higher operating costs, when renting furnished apartments, generally four-fifths or, when including laundry, two-thirds of the rental income is considered as taxable gross rental income.

3. In-kind contributions made by the tenant or lessee are also considered part of the gross rental income.

1. For single-family and holiday homes, as well as owner-occupied apartments, the imputed rental value is periodically determined by the Board of Standards.

1. Only the current contributions are considered as maintenance payments that a spouse provides for the support of the other in the case of a divorced or separated marriage.

1. Depreciation for the impairment of business assets is permissible to the extent that it is shown in the accounts or in special depreciation schedules.

2. The amount of depreciation is determined based on the capital value (acquisition or production costs) and the residual value of the asset to be depreciated. Depreciation corresponds to the depreciation of individual assets within the fiscal year or is appropriately allocated over the expected useful life.

3. An upward valuation of assets can increase the starting value for depreciation insofar as it enhances business revenue or serves to offset losses that are chargeable according to Art. 33 of the Tax Act (StG). The commercial legal provisions of the Code of Obligations (OR) remain reserved.

4. Further depreciation is permitted in accordance with the directives of the professional commission.

1. Adjustments are permissible for only temporary changes in value.

2. Adjustments are correction entries on assets for devaluation that has already occurred or is expected to occur in the immediate future. In justified cases, correction entries on liabilities are also possible.

3. Adjustments on assets particularly include allowances for doubtful accounts, adjustments on real estate, participations, and inventories, as well as recorded, unrealized exchange losses on securities and foreign currencies as of the balance sheet date. The Council shall issue further detailed instructions.

1. Provisions for Offsetting Imminent Business Losses are Permissible

a) for obligations that arise from events in the fiscal years relevant for income taxation, the legal validity or amount of which is still indeterminate;

b) for imminent loss risks that are established in the relevant fiscal years.

1. The provision formed for a replacement procurement can be used for depreciation on the replacement object within three years. The period is extended if the delay is caused by circumstances beyond the control of the taxpayer.

2. The transfer of hidden reserves to a replacement object, whose acquisition already took place in the previous fiscal year, is also permissible.

3. The hidden reserves of a disposed of fixed asset can only be transferred to a replacement object to the extent that the income tax value of the replacement object does not fall below the previous income tax value of the disposed of fixed asset. Ordinary depreciation can be applied to the remaining income tax value.

1. An undercapitalization is defined as the amount by which liabilities exceed the recognized assets.

1. Considered as maintenance expenses are

a) the expenses for upkeep, repair, and replacement, provided they do not constitute value-enhancing expenditures, as well as contributions to the repair and renovation fund of condominium owner associations, insofar as these funds are used solely to cover maintenance costs for the communal facilities and are irrevocably withdrawn from the taxpayer;

b) in the case of personal use, the operating costs, provided they are not directly caused by usage;

c) in the case of rental or leasing, the operating costs that are not passed on to the tenant or lessee.

2. Deductible insurance premiums include premiums for property and liability insurance for the property.

3. Also deductible as administrative costs are the necessary actual expenses of the taxpayer, insofar as they do not constitute compensation for their own work.

4. ...

5. The taxpayer can choose between the deduction of actual costs and the standard deduction for each assessment period and for each property.

1. The term "children" refers to biological children as well as adoptive, step, and foster children.

2. Training costs in accordance with Art. 37 lit. b of the Tax Act (StG) are considered to be self-paid if the expenses for the attended school are primarily funded by parental contributions rather than by state benefits.

1. Household items include those objects that are part of the standard furnishing of a residence and genuinely serve residential purposes, namely furniture, carpets, pictures, kitchen and garden tools, tableware, books, as well as devices for both entertainment and consumer electronics.

2. Personal items are considered to be everyday items of use, namely clothing, jewelry, sports equipment, cameras, and film equipment.

3. Motor vehicles, boats, riding horses, and art collections, as well as assets and collections whose value significantly exceeds the commonly usual or are likely to become the basis for considerable capital gains, do not count as household items or personal items.

1. The assessment that is final or at least has been issued on the assessment date is decisive. If the issued assessment is the subject of an appeal, it becomes legally binding retroactively from the date of its issuance upon the conclusion of the appeal process.

2. Properties are generally re-assessed every ten years. The taxpayer or the tax authority may request a re-assessment at any time, particularly after structural changes.

1. In the calculation of the additional wealth tax, no tax-free amounts are deducted.

1. The wealth tax imposed on an interest is calculated in proportion to this interest relative to the total assets.

1. In international tax allocations, a change to the direct allocation of profit and capital shares requires the approval of the tax authority.

2. The allocation method once chosen shall be retained unless justified circumstances necessitate a change. This change requires the approval of the tax authority.

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1. Losses and Loss Carryforwards of Dissolved Legal Entities Cannot Be Claimed when the Merger, Consolidation, or Acquisition Is Executed for the Purpose of Tax Avoidance, Particularly in the Acquisition of Economically Liquidated Companies or Companies that Exist Solely as a Corporate Shell.

1. Legal entities whose profit and capital are partially or exclusively dedicated to public or charitable purposes for the duration can claim tax exemption for the corresponding parts of the profit and capital.

2. Exempt from tax liability are associations of public-law entities and public corporations that exclusively perform public duties such as water supply, wastewater treatment, and waste disposal.

1. Services are also accounted for at market value between related parties.

2. The market value is derived from the respective market price. If such a price is absent, the market value is calculated based on the production costs plus a reasonable markup (cost-plus method).

3. The parties involved are entitled to provide evidence of the correctness of a different valuation based on special circumstances.

4. In the transfer of real estate, Article 7 paragraph 3 of this regulation applies mutatis mutandis.

1. Voluntary contributions are not commercially justified insofar as they are made primarily in the interest of persons closely related to the donating legal entity.

1. The provisions of income tax concerning depreciations, value adjustments, provisions, and replacement procurements shall be applied mutatis mutandis.

2. Diminutions in value of participations pursuant to Article 68 paragraph 4 of the Tax Act are only final if the company has ceased its business activities, or to the extent that a permanent significant loss in value can be proven for other reasons.

1. An underbalance is the amount that is lacking to cover the share capital and statutory reserves.

2. A qualified deficit according to Article 670 of the Swiss Code of Obligations is not a prerequisite for the offsetting of losses with restructuring contributions.

1. The net profit calculated in accordance with Article 60 et seq. of the StG is decisive.

2. The reduction of the tax rate is excluded for those profit shares,

a) for which the participation deduction pursuant to Article 68 of the StG is already granted or

b) which are allocated to other tax domiciles based on intercantonal or international regulations for tax allocation.

1. Revenue from participations includes all ordinary and extraordinary profit distributions to the holder of the participation right, provided that they have been recorded as income and allocated to the taxable net profit.

2. The following are not considered participation income, in particular

a) Liquidation surpluses and merger gains, insofar as the acquisition costs exceed the taxable value of the gains;

b) Payments that constitute a business-related expense of the company or cooperative;

c) Capital and revaluation gains as well as proceeds from the sale of subscription rights, insofar as Article 68 paragraph 4 of the Tax Act is not applicable.

1. For the determination of the 10% quota, multiple disposals or revaluations within a financial year can be aggregated.

1. The timing of the financial statement closure may be exceptionally postponed with the approval of the assessment authority, without requiring a financial statement to be prepared every calendar year.

2. The postponement of the financial statement closure will be approved in advance if distortions in the assessment basis are excluded. The capital tax is owed on a pro rata temporis basis if the postponement of the financial statement closure is approved.

1. The Cantonal Executive Commission establishes the withholding tax rates for all taxable individuals and issues the further implementing provisions.

2. The Cantonal Executive Commission can, in particular, also regulate the transition from the withholding tax procedure to the ordinary assessment procedure and vice versa, as well as the exact timing and the crediting of already collected taxes.

3. In the case of districts that have incorporated a school community, the average values of the district and school community tax rates for the last three calendar years prior to the incorporation are used for the weighted average of the district and municipal taxes in the canton according to Art. 82 para. 2 StG.

1. The tax is calculated based on the shares to which the heir or beneficiary is entitled according to the provisions of inheritance law or by virtue of a testamentary disposition. If the testator has left a testamentary disposition, this is decisive for determining the taxable bequests. If there is no testamentary disposition, the individual inheritance shares are calculated in accordance with the statutory succession.

2. Deviations from the principles outlined in paragraph 1 are recognized for tax purposes if the agreement reached among the heirs is neither unusual nor primarily serves the purpose of tax savings.

3. A transfer is also subject to gift tax if there is a clear disproportion between the performance and the consideration (mixed donation). For tax purposes, a mixed donation is present if the difference in value amounts to at least 25%.

1. The proceeds from the sale can be used to purchase a replacement property within three years after the sale. The period is extended if the delay is due to circumstances beyond the control of the taxpayer.

2. The acquisition of the replacement property within one year prior to the sale of the property to be replaced is also permissible.

3. If the replacement acquisition occurs only after the sale, the tax amount already collected will be refunded in whole or in part without interest.

4. Capital gains from property, the taxation of which has been deferred, will be taxed upon the sale of the replacement property. For tax calculation purposes, the duration of ownership of the replaced property is taken into account.

1. Indemnities for inconvenience do not count as taxable revenue, insofar as the purchaser compensates for costs associated with the sale, such as adjustments, business relocation, move, and any potential loss of earnings.

2. Depreciation of the remaining properties cannot be claimed as inconvenience.

1. Third-party benefits deducted from the investment costs also include compensation for a reduction in value, provided they have not been or will not be captured by income tax.

1. The Official Commission may establish minimum thresholds up to which tax collection can be waived.

1. The invoice from the authority responsible for land registry matters is deemed an assessment order pursuant to Article 127 of the Tax Act.

2. The tax liability lies exclusively with the acquirer of the property, even if the seller has committed to partially or fully pay the property transfer tax. The acquirer is the taxable entity. The assessment order is to be delivered to them.

3. If the tax claim or tax calculation is contested, the taxpayer may file an objection in writing with the tax authority (Article 143 of the Tax Act).

1. After the divorce, the transfer of ownership in the course of the settlement of matrimonial property is tax-free, provided the transfer of the real estate is executed pursuant to the divorce decree.

2. Upon the death of a spouse, the transfer of ownership is tax-free according to the matrimonial and inheritance rights of the surviving spouse. The transfer of the common residence of the spouses is completely tax-free.

3. No tax exemption is granted for acquisition by an heir during the division of an estate or by a universal heir.

1. Information about legally binding tax factors may be provided exclusively to the taxpayer themselves, but not to third parties.

2. Districts and municipalities, whose taxes are collected by the canton, may request that the organs responsible for accounting (authorities, audit commission) be granted access to the tax collection lists at the cantonal tax administration. The organs must present proof of their audit mandate to the tax administration.

1. The employees responsible for the matter must be specified in the directive.

1. Employees of the cantonal tax administration may not represent parties in tax matters within the canton.

1. The exchange of data between the taxpayer and the tax authority may also take place electronically. The tax authority may regulate the conditions.

1. The heirs must submit the inheritance inventory as a tax declaration, as well as the partition documents, to the tax authority even if there is no inheritance tax obligation.

1. The state receives from the districts and municipalities an assessment compensation of 1.2% as well as a collection compensation of 0.8% of the tax revenues submitted to them.

2. As compensation for the collection of withholding taxes, the state receives 10% of the submitted tax amounts.

1. General Due Date for Periodically Owed Taxes is July 31 of the calendar year in which the tax period ends.

2. Inheritance and gift taxes become due 90 days after the claim arises according to Art. 96 para. 4 StG.

3. Other taxes, fines, and fees become due upon delivery of the invoice. Art. 160 para. 4 StG remains reserved.

4. In any event, the tax becomes due

a) on the day the taxpayer, who intends to permanently leave the country, takes steps to depart;

b) upon filing for the deregistration of a taxable person in the Commercial Register;

c) at the time when the foreign taxpayer ceases their business operations or their participation in a domestic business, their domestic permanent establishment, their domestic real estate, or their claims secured by domestic properties;

d) upon the opening of bankruptcy proceedings against the taxpayer;

e) upon the death of the taxpayer.

5. The due date remains unchanged even if at that time the assessment has not been carried out or if an objection or appeal against the assessment has been lodged.

6. The taxpayer can make advance payments before the due date.

7. If the owed tax amount is not settled within the payment period, the taxpayer must be sent a payment reminder. If payment is not made within the period set in the reminder, the taxpayer is subject to a penalty notice.

1. Deferrals and installment payments shall generally only be granted if it appears that the full payment of the amounts owed can be secured within one year from the date of invoicing.

1. Waiver of Debt Collection Proceedings

Debt collection proceedings can be waived if, based on the financial circumstances, they would obviously end with a certificate of loss.

1. The authority responsible for the land registry reports the estimated sales proceeds to the cantonal tax administration prior to the entry in the land register. Based on this, the tax administration invoices the provisional amount of the capital gains tax on real estate as a deposit.

2. The authority responsible for the land registry expressly informs the contracting parties about the existence and scope of the statutory lien for property and capital gains taxes. They specifically mention that the purchaser's property may be liable for all outstanding claims and that the purchaser can request written information from the tax authority regarding any unpaid property taxes. The fact that these notifications have been given must be recorded in the document.

1. Fines for the violation of procedural obligations fall into the state treasury.

2. Fines for tax evasion are allocated proportionately to the additional taxes among the state, districts, and municipalities.

1. As of January 1, 2001, private assets involving participations of at least 20% in the share or common capital, or a tax market value exceeding one million Swiss Francs, of a corporation or cooperative based in the canton of Appenzell Innerrhoden can be declared as business assets by taxable persons residing in the canton as of January 1, 2001, in the tax return for the tax year 2001.

2. On these participations, annual depreciations can be made from the income tax value according to paragraphs 3 and 4 of this article, for up to ten years, limited to the annual returns from distributions of old reserves up to the final value. For the determination of the tax rate, these distributions are decisive before deduction of the depreciations. The reduced dividend taxation according to Art. 38 para. 4 of the StG does not apply to the extent that corresponding depreciations oppose these distributions.

3. The income tax value of the participation is determined based on the nominal value of the participation, plus the proportional open reserves shown in the financial statements for the business year 2000, without taxed additional values and without the non-distributable reserves of the corporation or cooperative. The final value amounts to the nominal value of the participation.

4. In the case of participations in corporations and cooperatives, which were only partially subject to tax on their profits in the canton during the tax years 1999 and 2000, the income tax value is determined based on the nominal value of the participation, plus the proportional open reserves shown in the financial statements for the business year 2000, without taxed additional values and without the non-distributable reserves of the corporation or cooperative. Only the portion of the reserves corresponding to the taxable quota in the canton on average of the tax years 1999 and 2000 is considered. The final value amounts to the nominal value.

5. The participations according to para. 1 of this article transfer into private assets after they have been written down to the final value, no later than after the expiration of ten years.

6. Art. 21 para. 2 of the StG is not applied.

7. The income tax values and final values in terms of para. 3 and 4 of this article are established during the assessment of the involved taxable natural persons for the tax year 2001 in an appealable decree, against which opposition and complaint can be filed.

1. For transfers of residential properties from business assets to private assets made by December 31, 2019, Article 7 paragraph 3 of this regulation applies in its previous version.

1. This ordinance shall come into force on January 1, 2001, following its adoption by the Grand Council.