TF, 18.05.2026, 9C_39/2026
Facts
A., director and majority shareholder (80%) of B. SA, was subject to tax back-payment and tax evasion proceedings for the 2010 to 2016 tax periods. These proceedings were initiated after the Federal Tax Administration (FTA), during VAT and withholding tax audits, informed the Vaud Cantonal Tax Administration (ACI) that the company had covered numerous private expenses for its shareholder. These expenses, classified as constructive dividends, included "track days," "ski trips," allegedly fictitious sponsorship fees, and the rental of parking spaces near the appellant's home. (Facts A.a to A.c)
The ACI opened parallel proceedings against the company and A. On December 15, 2022, it notified the latter of a tax back-payment decision for 2008-2014 and an assessment for 2015-2016, as well as fines. In a decision on the objection dated January 29, 2025, the ACI acknowledged the statute of limitations for 2008-2009 and slightly reduced the tax adjustments. The taxpayer appealed this decision to the Vaud Cantonal Court, which separated the fine proceedings from the tax back-payment case. (Facts A.d to B.a)
In a partial judgment on December 2, 2025, the Cantonal Court partially upheld the appeal but confirmed the existence of constructive dividends in principle. It remanded the case to the ACI for a new decision and recalculation of the amounts due. The taxpayer (hereinafter: the appellant) filed a public law appeal with the Federal Supreme Court, seeking the annulment of the cantonal judgment. (Facts B.b and C)
Legal Analysis
The Federal Supreme Court reiterates the applicable legal principles. First, it examines ex officio the issue of the statute of limitations for tax back-payment. Regarding Federal Direct Tax (art. 152 para. 3 DBTA) as well as Cantonal and Communal Tax (art. 53 para. 3 HTA and art. 208 para. 3 LI/VD), this right expires fifteen years after the end of the relevant tax period. (cons. 4.1, 4.2)
Second, the right to be heard (art. 29 para. 2 Const.) guarantees the interested party the right to produce relevant evidence, to participate in its administration, and to comment on the results. It also includes the right of access to the file (art. 114 DBTA, Art. 41 LHID). This right may be restricted to protect overriding interests, such as tax secrecy. In such cases, the authority must disclose the essential content of the confidential document to the taxpayer so that they may state their position. A claim of violation of the right to be heard must be raised without delay, under penalty of foreclosure. (cons. 5.3, 6.2, 6.3.2)
Third, regarding the establishment of facts and the assessment of evidence, the Federal Supreme Court only intervenes if the previous authority acted arbitrarily (Art. 9 Cst.), meaning if it ignored relevant evidence without serious reason, misunderstood its meaning or scope, or drew unsustainable conclusions. The mere fact of not following a party's line of argument does not constitute arbitrariness. (cons. 2.2, 5.3)
Finally, the Federal Supreme Court reiterates the principle of the independence of tax proceedings. The tax authority for direct taxes is not bound by the findings or assessments of an authority in charge of indirect taxes (VAT) or withholding tax. Each authority conducts its own investigation and proceeds with its own assessment of the facts and the law. (cons. 7.2.1)
Application to the specific case
The Federal Supreme Court examines the statute of limitations ex officio. The right to initiate a tax back-payment for the 2010 tax period expired on December 31, 2025. As the cantonal judgment was rendered on December 2, 2025, the statute of limitations had not yet expired at that time. However, it occurred during the proceedings before the Federal Supreme Court. Consequently, the appeal must be upheld on this point, and the tax back-payment for 2010 (federal and cantonal/communal income tax) is cancelled. (cons. 4.2, 9)
Regarding the appellant's grievances, the Federal Supreme Court rejects the argument of arbitrary assessment of evidence. It finds that the Cantonal Court could, without acting arbitrarily, judge that the client testimonials produced were too general and late, and that the testimonies had reduced probative value due to the acknowledged friendships between the witnesses and the appellant. Likewise, the analysis of the company's turnover, which showed no clear correlation with representation expenses, is not deemed unsustainable. (cons. 5.2, 5.4, 5.5, 5.6)
The grievance regarding the violation of the right to be heard, linked to the inability to consult C.'s statements (relating to sponsorship), is also dismissed. The Federal Supreme Court notes that the appellant raised this grievance for the first time before it, which is late and contrary to the principle of good faith. Furthermore, the essential content of these statements, protected by tax secrecy, had been communicated to him, allowing him to defend himself. (cons. 6.1, 6.3.1, 6.3.2)
The Federal Supreme Court also rejects the argument based on the violation of the principle of good faith, according to which the cantonal tax authority (ACI) had unfairly deviated from the findings of the Federal Tax Administration (AFC). It recalls that the ACI was not bound by VAT or withholding tax audits and was entitled to conduct its own investigation, which it did by carrying out its own verifications. (cons. 7.1, 7.2.2)
Finally, the classification of parking space rental fees as a constructive dividend is confirmed. The Cantonal Court ruled in a non-arbitrary manner that the rental of spaces near the appellant's home, far from the company's premises, and in very limited numbers compared to the vehicle fleet, did not meet a credible business justification. (cons. 8.1, 8.2, 8.3)
Outcome
The Federal Supreme Court partially upholds the appeal. It annuls the cantonal judgment insofar as it concerns the 2010 tax period, as the right to initiate a tax back-payment for that year is time-barred for both federal and cantonal/communal income tax. For the remainder, the appeal is dismissed, thereby confirming the principle of tax adjustments for the 2011 to 2016 periods. Legal costs are partially charged to the appellant, who receives reduced legal fees, to be paid by the Federal Supreme Court's treasury. (cons. 1, 2, 9, 10)
Silex Tax Newsletter published in collaboration with Anna Vladau, Attorney at Law
