Federal Supreme Court, 23.06.2026, 9C_452/2025
Facts
A.________ AG (hereinafter: the appellant) has had its registered office in the canton of Zug (ZG) since 2015. It was definitively taxed by the Zug tax administration for the 2015 to 2018 tax periods, with all of its tax factors assessed there. In 2020, the tax administration of the canton of Zurich (ZH) informed the appellant that it suspected its effective management was actually located within its territory, due to the activities of its sole shareholder and sole director, C.________. Consequently, Zurich claimed tax sovereignty over the company as of January 1, 2015, which was confirmed by the Zurich judicial authorities. (Sachverhalt A.a, A.b)
In parallel, the appellant attempted to have its Zug tax assessments for the years 2015 to 2018 revised, but its request was declared inadmissible due to being filed out of time, a decision confirmed in the final instance by the Federal Supreme Court. Based on the uncontested Zurich decision regarding tax sovereignty, the Zurich tax administration proceeded to tax the appellant for the 2015 to 2019 periods without performing an intercantonal apportionment. This taxation was confirmed by the Administrative Court of the canton of Zurich. (Sachverhalt A.c, A.d, B)
The appellant filed a public law appeal with the Federal Supreme Court. It requested the annulment of the Zurich judgment, a reduction of the tax factors assessed in Zurich, and the annulment (or, alternatively, a reduction to zero) of the Zug tax assessments for 2015-2018, along with a request for the refund of taxes unduly collected by Zug. (Sachverhalt C)
Legal Analysis
The Federal Supreme Court reiterates the admissibility rules regarding intercantonal double taxation. Pursuant toArt. 100 para. 5 LTF, a final tax assessment decision from another canton may be challenged in conjunction with an appeal against the decision of the second canton in order to resolve the conflict of double taxation. A request for the refund of taxes unduly collected is also admissible in this context, unlike a request for default interest, which does not derive directly fromArt. 127 para. 3 Cst. (consid. 1.1, 1.2)
On the merits, harmonized tax law (Art. 20 para. 1 LHID) provides that a legal entity is subject to unlimited tax liability (personal attachment) in the canton where its registered office or its place of effective management is located. In the event of a conflict between the canton of the registered office and that of the place of effective management, case law regarding the prohibition of double taxation (Art. 127 para. 3 Cst.) gives primacy to the place of effective management, which constitutes the principal tax domicile. The canton of the registered office retains only a limited right of taxation if the company maintains a secondary tax domicile there, such as a permanent establishment (Art. 21 LHID). (recital 3.2.1)
Effective management is defined as the place where important day-to-day management decisions are made, where the company's operations are coordinated, and where the actual center of its economic existence is located. It involves determining the center of gravity for daily business operations based on the totality of the circumstances. (recital 3.2.2)
Regarding taxpayer conduct contrary to good faith, the Federal Supreme Court reaffirms its updated case law (BGE 149 II 354). The forfeiture of the right to appeal on these grounds has been abandoned. On the merits, a taxpayer only loses the right to the elimination of double taxation if their conduct is classified as abusively contrary to good faith and the canton that lacks the right to tax has an exceptional legitimate interest in retaining the taxes collected. Mere distortions in the national fiscal equalization scheme (NFE) do not constitute such an interest. (recital 4.2)
Application to the case at hand
The Federal Supreme Court first examines the issue of the primary tax domicile. It relies on the findings of the Zurich authorities, which are not arbitrary. These findings established that the appellant's sole shareholder and director, C.________, carried out intense operational activities (personnel consulting) from prestigious premises in Zurich, where the group's subsidiaries were also located. In contrast, at its registered office in Zug, the appellant had only minimal and low-cost infrastructure (a sublet office), which was insufficient for conducting actual management activities. The Federal Supreme Court therefore confirms that the center of gravity of management and the company's true economic center were located in Zurich. (recitals 3.3.1, 3.3.2)
The Federal Supreme Court rejects the appellant's argument that it could rely, under the principle of protection of good faith, on a restrictive interpretation of the Zurich tax sovereignty decision. That decision unequivocally established a personal nexus and thus unlimited tax sovereignty for the Canton of Zurich, rather than a mere economic nexus for a portion of its activities. Furthermore, the Federal Supreme Court confirms that in the absence of significant qualitative and quantitative activity in Zug, the appellant did not have a permanent establishment there that would justify a secondary tax domicile. Consequently, the full taxation by the Canton of Zurich for the 2015 to 2019 periods is correct. (recitals 3.4, 3.5)
Next, the Federal Supreme Court addresses the current double taxation situation for the years 2015 to 2018, resulting from taxation by Zug (now deemed without right) and by Zurich (with right). The Zug tax administration argues that the appellant acted in bad faith by concealing its Zurich activities and should therefore forfeit its right to a tax refund. While the Federal Supreme Court deems the appellant's conduct "at least questionable," it finds that it does not meet the criteria for qualified abuse of rights. Above all, the Canton of Zug fails to demonstrate any exceptional legitimate interest in retaining taxes it collected wrongfully. Double taxation must therefore be eliminated. (recitals 4.1, 4.3)
Outcome
The Federal Supreme Court dismisses the appeal insofar as it is directed against the Canton of Zurich. It grants the appeal insofar as it is directed against the Canton of Zug. Consequently, the tax assessments of the Canton of Zug for the 2015 to 2018 tax periods are annulled, and the Canton of Zug is ordered to refund the taxes already collected for these periods to the appellant. (dispositive parts 1, 2)
Regarding costs and legal fees, the Federal Supreme Court departs from the principle that the losing party bears the costs. Although the appellant prevails against the Canton of Zug, its conduct is deemed contrary to good faith because it concealed the reality of its Zurich activities from the Zug authorities, thereby causing the dispute. For this reason, the entire court costs are charged to the appellant. Furthermore, due to the unnecessary procedural work caused, the appellant is ordered to pay legal fees to the Canton of Zug, even though the latter lost on the merits. (recitals 5.2.2, 5.3, dispositive parts 3, 4)