Swiss Federal Supreme Court, 30.12.2025, 9C_209/2025
Facts
A taxpayer, who was an employee of a company he owned, held a stake in company C., which he had declared as part of his private assets. In 2016, following the conversion of loans into capital and the merger by absorption of C. into a new company, D. (wholly owned by the taxpayer), the capital of D. saw a significant increase without any cash payment.
The Ticino tax authority deemed this gratuitous increase in the nominal value of the D. shares to be a monetary benefit and added CHF 764,573 to the taxpayer's taxable income for 2016. It also increased the valuation of the stake for wealth tax purposes for the years 2016 to 2018.
The taxpayer challenged these decisions, arguing that his stake in D. should be classified as business assets rather than private assets. His claims were rejected by the tax authority and subsequently by the cantonal court, which confirmed that the stake was part of his private assets. The taxpayer appealed to the Federal Supreme Court.
Legal Analysis
In accordance withArt. 20 para. 1 let. c of the Federal Direct Tax Act (LIFD) (and the equivalent cantonal provision), monetary benefits derived from shareholdings, including gratuitous increases in nominal value, are taxable as income from movable assets. This taxation is based on the nominal value principle, which applies to holdings classified as private assets.
Conversely, if a stake is classified as business assets for an individual, the book value principle applies. In such cases, a gratuitous increase in nominal value is not considered taxable income.
For an individual to hold business assets, they must generally engage in self-employed professional activity. Case law recognizes that such activity can exist in the case of professional securities trading. Several indicators help determine this: the systematic and planned nature of the operations, the use of specialized knowledge, third-party financing, or the existence of actual buying and selling transactions.
Application to the Case
The dispute concerns the classification of the appellant's stake in company D.: private assets or business assets. The appellant maintains that he is a professional securities trader, which would justify classifying the stake as business assets.
The Federal Supreme Court rejects this argument. It first notes that the appellant failed to sufficiently demonstrate how the cantonal court's assessment of the facts was arbitrary. He merely presented his own interpretation of events.
Crucially, the Federal Supreme Court points out that an essential condition for recognizing professional securities trading is missing: an actual buying and selling transaction. The appellant has not sold his stake in D.; he still holds it. In the absence of such a transaction, one of the fundamental criteria for trading activity is not met.
The Federal Supreme Court also dismisses the secondary argument that self-employed activity should be recognized even in the absence of the criteria for securities trading, due to a lack of evidence of economic activity conducted at his own risk for profit. It further notes that the taxpayer had himself declared his stake as part of his private assets, which, while not decisive, corroborates the position of the tax authorities.
Outcome
The Federal Supreme Court dismisses the appeal regarding both federal direct tax and cantonal taxes. It confirms that the stake in company D. must be classified as the taxpayer's private assets. Consequently, the gratuitous increase in its nominal value was correctly taxed as income from assets for the 2016 tax period. The legal costs are to be borne by the appellant.
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