Lump-sum taxation (taxation according to expenditure)

In Swiss federal law, Article 14 of the Federal Act on Direct Federal Tax lets a natural person pay tax based on expenditure instead of income tax if they do not hold Swiss citizenship, become subject to unlimited tax liability in Switzerland for the first time or after at least 10 years, and carry on no gainful activity in Switzerland. Spouses living together must both meet the conditions.

The tax base is the annual worldwide living costs of the taxpayer and the people they support, but at least the highest of a fixed amount (CHF 435,000 in the federal text in force in 2026), seven times the annual rent or rental value, three times the annual board and lodging price for people without their own household, and a control calculation on Swiss-source and treaty-relief income. The tax is computed at the ordinary rates.

Cantons decide whether to offer it for their own taxes and set their own minimum. The Swiss Federal Tax Administration says Zurich, Basel-Stadt, Schaffhausen and Appenzell Ausserrhoden abolished it and Basel-Landschaft restricted it. The phrase lump-sum is also used loosely for flat annual charges in other countries, such as regimes for new residents, which work differently.

Not to be confused with

• Remittance basis. A remittance basis taxes foreign income when it is brought into the country, while Swiss expenditure taxation measures tax by living costs.
• Non-dom. Non-dom regimes depend on domicile, while Swiss expenditure taxation depends on citizenship, years away and having no Swiss gainful activity.

Sources

• Bundesgesetz über die direkte Bundessteuer (DBG), SR 642.11, Art. 14 (Stand 2 September 2026)Primary law
• Geltende Steuern (Stand der Gesetzgebung: 1. Januar 2026), ESTVOfficial guidance

Related

Countries covered

General

Sources

2 sources

Tax year

Current rules as checked

Review

Not professionally reviewed
Sources checked November 9, 2026