Tax return for sole proprietorships in Switzerland – explained simply
Anyone running a sole proprietorship in Switzerland with an annual turnover of less than CHF 500,000 benefits from simplified accounting obligations. Yet every year, the same question arises: how do I correctly complete my tax return – without double-entry bookkeeping?
Here, you will learn step by step what you really need – and how to avoid unnecessary stress.
Does a sole proprietorship under CHF 500,000 need double-entry bookkeeping?
No. According to Art. 957 CO, a turnover of less than CHF 500,000 is sufficient for simple accounting.
This means:
- No double-entry bookkeeping
- No balance sheet requirement
- No income statement
- No complex chart of accounts
A so-called “milk bookkeeping” method – a systematic record of income and expenses – is allowed. This significantly reduces administrative effort.
How does simple accounting (milk bookkeeping) work?
The calculation is straightforward: Income – Expenses = Profit
This profit is considered:
- Personal income
- Basis for income tax
- Basis for AHV contributions
Important: Even if you do not transfer the profit to your personal account, it is still taxable.
What does the tax office require for the tax return?
For your sole proprietorship tax return, you need:
- Total income
- Total expenses
- Net profit
- Overview of business assets (e.g., business account, outstanding invoices)
The profit is entered in the self-employed section of your personal tax return. For small sole proprietorships, this is all that is required.
Which expenses are deductible?
In small businesses, the savings potential is significant. Typical deductible business expenses include:
- Home office portion
- Phone & Internet (business portion)
- Software subscriptions
- Website & marketing
- Continuing education
- Work materials
- Vehicle costs (business portion)
- Insurance
- Accounting/fiduciary fees
Rule of thumb: Anything that is business-related can be deducted.
Common mistakes in small business tax returns
Many self-employed individuals underestimate the requirements for clean simple accounting.
Typical issues:
- No clear separation of personal and business finances
- Missing receipts
- Numbers gathered only shortly before the deadline
- Unexpected AHV back payments
- Excel sheets become confusing
Simple accounting can be simple – but it must be traceable.
Which accounting software is suitable for small sole proprietorships?
Many programs are designed for LLCs or corporations – with double-entry bookkeeping, chart of accounts, and complex financial statements. For sole proprietorships under CHF 500,000 turnover, this is often unnecessarily complicated.
This is exactly why Effizo was developed. Effizo is intentionally simple accounting software for sole proprietorships in Switzerland – essentially a digital milk bookkeeping system.
With Effizo, you can:
- Easily record income and expenses
- Store receipts digitally
- View your current profit anytime
- Export a clean overview for the tax return
- Avoid stress before the deadline
No double-entry bookkeeping. No unnecessary complexity. Just what you really need.
Who is Effizo ideal for?
Effizo is especially suitable for:
- Freelancers
- Consultants
- Craftsmen
- Online self-employed
- Part-time self-employed
- Sole proprietorships with less than CHF 500,000 turnover
So for anyone looking for simple, compliant accounting in Switzerland.
Conclusion: Sole proprietorship tax return in Switzerland – simple when the structure is right
For small sole proprietorships, the tax return is much simpler than many think.
With a well-maintained milk bookkeeping system:
- you stay on top of things
- avoid back payments
- save time
- reduce stress
And this is exactly where Effizo supports you.