Common Mistakes in Tax Returns and How to Avoid Them

Every year, many taxpayers in Switzerland make avoidable mistakes in their tax returns. These lead not only to unnecessary inquiries from the tax office, but can also result in a higher tax burden or even fines.

In this article, you will learn which mistakes occur most frequently – and how you can avoid them with a few simple measures.

Mistakes Regarding Deadlines

Submitting Tax Return Too Late

A common mistake is late submission. Those who miss the deadline (usually March 31) risk:

• Reminder from the tax office
• Reminder fees (varies by canton)
• In the worst case, a discretionary assessment (estimate by the tax office)
• Fines for violation of procedural obligations

Reminder Fees by Canton (2026)

The costs for reminders vary greatly between cantons:

• Zurich (City): First reminder free
• Bern: CHF 60
• Basel-Stadt: CHF 40
• Aargau: CHF 35
• Other cantons: CHF 0 to CHF 100

Important: The reminder period is usually 10 days and cannot be extended.

Request Extension on Time

In most cantons, the deadline can be extended free of charge online:

Zurich:

• First extension until September 30 (free, apply before March 31)
• Second extension until November 30 (can be applied for from August)

Bern:

• Extensions possible (online, by phone, or in writing)
• If late: CHF 60 reminder fee

Basel-Stadt:

• First extension until September 30 (free)
• Further extensions: CHF 40 fee
• Beyond year-end only with valid reasons and advance payment

Aargau:

• Employees: until March 31, self-employed: until June 30
• Online extension possible

Important: The extension must be requested before the deadline expires. After the deadline, an extension is usually no longer possible.

Tip: Even if you think you'll make it – request an extension as a precaution. This is free in most cantons and can be done online within minutes.

Discretionary Assessment – What Happens?

Those who do not submit a tax return despite a reminder will be assessed according to discretion. This means:

• The tax office estimates your income and assets
• The estimate is usually significantly higher than the actual tax burden
• You can only appeal due to obvious inaccuracy (within 30 days)
• The appeal must be justified and include the complete tax return with all receipts
• You additionally risk a fine for violation of procedural obligations

Costs of discretionary assessment:

• Basel-Stadt: CHF 100 to CHF 500
• Basel-Stadt (legal entities): CHF 200
• Other cantons: Variable

Mistakes Regarding Income and Assets

Incomplete Income Declaration

Frequently forgotten:

• Side income (e.g., freelance work, side jobs, fees)
• Pensions and daily allowances: IV pensions, unemployment benefits (ALV), sickness daily allowances (also from private insurance), accident pensions, maternity benefits
• Capital income: Dividends (also from abroad), interest on bank and savings accounts, bond interest, returns from investment funds
• Alimony (maintenance for ex-partner)
• Bonuses and gratuities from employer
• Rental and lease income (also from parking spaces, garages)
• Lottery winnings over CHF 1,000 (Sport-Toto, number lottery)
• Refunds of withholding tax
• Income from foreign sources

Consequences:

• Back taxes with interest
• Fine for tax evasion (1/3 to 3× the back tax)
• If intentional: Criminal proceedings for tax fraud

Tip: Collect all salary statements, account statements as of December 31, insurance confirmations, and other proof of income and declare them completely.

Incorrect Asset Declaration

Frequently missing:

• Balances in foreign bank accounts (including interest income)
• Cryptocurrencies (Bitcoin, Ethereum, etc. in securities list)
• Vehicles (car, motorcycle, boat – market value)
• Life insurance with surrender value (Pillar 3b)
• Precious metals (gold, silver physical or as securities)
• Jewelry and art objects (from a certain value)
• Shareholdings in unlisted companies
• Loans to third parties (receivables)
• Pension fund balances (vested benefits account, Pillar 3a)

Special feature cryptocurrencies (increasingly controlled since 2022):

• Must be declared as assets
• Valuation as of December 31 at daily rate
• Rates on www.estv.admin.ch or at cantonal tax administration
• Staking rewards and mining income are also taxable income

Important: Tax offices increasingly automatically compare data (Automatic Exchange of Information with foreign countries, reports from banks, crypto exchanges, etc.).

Tip: Collect account statements from all banks as of December 31. Be sure to declare foreign accounts and assets – discovery by the tax office leads to severe penalties.

Withholding Tax: Forgetting Subsequent Ordinary Assessment

Persons subject to withholding tax (foreign employees without permanent residence permit) must submit a tax return if:

• Gross income over CHF 120,000 per year
• Assets over CHF 80,000 (single person) or CHF 160,000 (married couple)
• Other income over CHF 3,000 (e.g., rental income, investment returns)

Those who exceed these thresholds and do not submit a tax return risk back taxes and fines for violation of procedural obligations.

Tip: If uncertain, contact the responsible municipal tax office.

Mistakes Regarding Deductions

Forgetting Important Deductions

Many taxpayers do not use all options. Frequently forgotten:

Pension provision:

• Payments into Pillar 3a (Maximum 2026: CHF 7,258 for employees with pension fund)
• Purchases into pension fund (Pillar 2)
• Insurance premiums (health insurance, accident insurance, life insurance)

Illness and accident costs:

• Self-paid medical and dental costs (over 5% of net income)
• Medications (prescribed by doctor)
• Glasses and contact lenses (with doctor's prescription)
• Alternative therapies (if recognized by health insurance)
• Hospital costs (not covered by insurance)
• Aids (wheelchair, hearing aids, etc.)
• Celiac disease flat rate: CHF 2,500 per year without receipts

Donations:

• To charitable organizations (min. CHF 100)
• To political parties (represented in parliament, min. 3% share of votes)

Occupational expenses:

• Commuting costs (public transport passes, mileage rate CHF 0.75)
• Meal costs (CHF 15/30 per working day)
• Continuing education costs (max. CHF 13,000 federal tax 2026)
• Work equipment (computer, professional literature, tools)
• Home office costs (if all requirements are met)

Childcare:

• External childcare by third parties (daycare, childminder, after-school care)
• Maximum varies by canton

Interest on debt:

• Mortgage interest
• Credit interest (also consumer credits)
• Up to CHF 50,000 + gross investment income

Alimony:

• To divorced or separated ex-partner
• For children up to 18 years

Tip: Go through list of all possible deductions and check if they apply to you. Software programs (BalTax, TaxMe, VATax, etc.) help to not forget any deductions.

Claiming Incorrect Deductions

A common misconception is that these are not deductible:

• Rent for the apartment (only imputed rental value and mortgage interest for owned property)
• Private living expenses (clothes, food, hobbies)
• Normal business attire (suit, blouse – only special work clothing)
• Education costs for first degree at upper secondary level (apprenticeship, Matura)
• Commute to workplace if public transport is reasonable (still used car)
• Meal costs if returning home is possible
• Leasing rates for private car (only purchase price and interest on credit)
• Fines (traffic fines, tax fines)
• Private insurance over maximum (e.g., household insurance doesn't count toward deduction)

Consequences: Correction by tax office, inquiries and delays for larger amounts, in worst case: fine for incorrect information.

Tip: Claim deductions only for legally permitted costs. If in doubt, consult cantonal guide to tax return or contact tax office.

Mistakes Regarding Real Estate

Not Declaring Imputed Rental Value

What is imputed rental value?Imputed rental value is the notional rental value of your owner-occupied home. It is taxed as income and usually amounts to 60-70% of the achievable market rent.

Common mistake: Many homeowners forget to state the imputed rental value – or enter it incorrectly.

Important:

• Imputed rental value is set by the tax office and can be seen on the previous year's tax bill
• For new constructions or changes: Have imputed rental value estimated by tax office
• Too low imputed rental value → Correction and back tax

Tip: Check the amount of imputed rental value annually. If market rents have fallen or the house needs renovation, you can apply for a reduction.

Confusing Maintenance and Renovation Costs

This is one of the most common and expensive mistakes for property owners.

Value-preserving costs (deductible):

• Repairs (e.g., fixing leaky roof)
• Replacement of same or equivalent systems (old heating with new one of same performance)
• Restoration (painting facade)
• Maintenance of garden and surroundings
• Minor renovations without increase in value

Examples: Replacing kitchen with equivalent new kitchen, replacing windows with equivalent new windows, replacing water heater, repairing roof, replacing heating (without technology change).

Value-increasing costs (not deductible):

• Extensions (e.g., attic to living space)
• Luxury renovations (e.g., marble bathroom instead of simple bathroom)
• New buildings and additions
• New facilities (e.g., swimming pool, sauna)
• Technology upgrade (e.g., from oil heating to heat pump → only the additional cost is value-increasing)

Examples: Replacing kitchen with significantly higher quality luxury kitchen, converting attic to living space, adding conservatory, installing swimming pool, building pergola.

Energy-saving investments (partially deductible):

• Heat pump, solar system, facade insulation, etc.
• Deductible: The energy-saving additional performance (e.g., heat pump instead of oil heating)
• Not deductible: The value-increasing portion

Tip: Check invoices carefully and classify correctly. If uncertain: Consult tax office or trustee. Have invoices detailed (materials, labor, disposal). Show energy-saving investments separately.

Special feature: In some cantons, you can choose between actual maintenance costs and a flat rate (e.g., 10-20% of imputed rental value). Check what is more favorable for you.

Mistakes Regarding Receipts and Documentation

Missing Documentation

Receipts for the following deductions are often missing – without proof, deductions are denied:

• Donations, medical costs, renovations, continuing education, work equipment, childcare, interest on debt

Important:

• The tax office can request receipts retroactively for up to 5 years
• Without receipts, deductions are denied or only partially recognized
• For larger amounts: Submit detailed breakdown with receipts

Tip: Collect all receipts digitally (e.g., scanned or photographed) or in an annual folder. Labeling with date and purpose makes it easier to find later.

Incomplete Documents

Frequently forgotten: Account statements as of December 31 (all banks, savings accounts, Pillar 3a), securities list with all positions as of December 31, insurance documentation, salary statement, certificates for pensions, rental agreement or imputed rental value notification, mortgage interest statement, withholding tax statement.

Tip: Create checklist and compile all documents before filling out tax return.

Incorrect Valuation of Assets

Common mistakes: Securities (check on www.estv.admin.ch), real estate (market value set by tax office), vehicles (Eurotax value), life insurance (request surrender value annually).

Tip: Use official tax price lists, contact tax office if uncertain.

Mistakes in Special Situations

Marriage, Divorce, Death

Marriage: From marriage date: Joint tax return, consider splitting procedure, claim dual earner deduction.

Divorce: Until divorce date: Joint tax return. From divorce date: Separate tax returns. Declare alimony correctly (payer: deduction / recipient: income).

Death: Deadline in case of death: 60 days (instead of 30 days). Tax return until date of death. Heirs must file tax return.

Tip: Contact tax office for special life events and request special forms.

Moving Abroad or to Another Canton

Moving during the year: Intra-year tax return required. Deadline: 30 days after delivery. When moving abroad: Appoint delivery agent in Switzerland.

Tip: Report to tax office in time and request forms.

Penalties and Consequences

Violation of Procedural Obligations (§ 234 StG / Art. 174 DBG)

Anyone who intentionally or negligently fails to comply with a procedural obligation despite a reminder will be punished with a fine: Normal: Up to CHF 1,000. Severe cases or repeat offense: Up to CHF 10,000.

Tax Evasion (§ 235 StG / Art. 175 DBG)

Anyone who intentionally or negligently provides incorrect or incomplete information and thereby causes an assessment that is too low must pay back the evaded tax plus default interest and will be punished with a fine: 1/3 to 3× the back tax (depending on fault). With voluntary disclosure (before tax office discovers evasion): Reduction of fine to 1/5 of back tax.

Tax Fraud (§ 236 StG / Art. 186 DBG)

Anyone who intentionally uses forged, falsified, or materially false documents for the purpose of tax evasion faces criminal proceedings, monetary fine up to CHF 30,000, and in severe cases: Prison sentence.

Attempted Tax Evasion

The attempt is also punishable. The fine amounts to two-thirds of the amount that would be assessed for completed tax evasion.

Practical Examples

Example 1: Forgotten Pillar 3a

An employee in Zurich pays CHF 7,258 into Pillar 3a but forgets to submit the receipt. Consequence: Lost tax savings: Over CHF 2,000. Correction possible through appeal (within 30 days).

Example 2: Undeclared Side Income

A student works as a freelancer and earns CHF 8,000. He does not declare the income. Discovery: Client reports payment. Consequence: Back tax, fine (approx. CHF 500-1,500), default interest.

Example 3: Incorrect Deductions for Renovation

A family renovates their kitchen with luxury equipment (CHF 80,000) and declares entire costs as value-preserving. Review: CHF 50,000 value-increasing (not deductible), CHF 30,000 value-preserving (deductible). Consequence: Correction, back tax, possibly fine.

Example 4: Forgotten Foreign Bank Account

A taxpayer has a savings account in Germany with CHF 50,000. Discovery: Automatic Exchange of Information. Consequence: Back tax on assets and interest, fine (1/3 to 3× back tax), default interest.

Example 5: Discretionary Assessment Due to Non-Submission

Self-employed person doesn't submit despite two reminders. Consequence: Tax office estimates income at CHF 150,000 (actually CHF 80,000), fine CHF 1,000, costs CHF 100-500. Appeal: Possible within 30 days with complete tax return, but fine remains.

Common Mistakes Overview

Missed Deadline

• Consequence: Reminder (CHF 0-100), discretionary assessment, fine up to CHF 10,000
• Prevention: Request extension on time

Incomplete Income

• Consequence: Back tax, fine 1/3-3× back tax, default interest
• Prevention: Collect all salary statements, account statements, side income

Assets Not Declared

• Consequence: Back tax, fine, possible criminal proceedings
• Prevention: Declare all accounts (including foreign), crypto, life insurance

Important Deductions Forgotten

• Consequence: Unnecessarily high tax burden
• Prevention: Use checklist, use software

Inadmissible Deductions

• Consequence: Correction, inquiries, possible fine
• Prevention: Only legally permitted deductions, consult guide

Imputed Rental Value Not Declared

• Consequence: Back tax, correction
• Prevention: Check previous year's value, contact tax office for changes

Renovations Incorrectly Classified

• Consequence: Correction, back tax
• Prevention: Check invoices in detail, consult trustee

Missing Receipts

• Consequence: Deductions are denied
• Prevention: Collect all receipts, archive digitally

Withholding Tax Forgotten

• Consequence: Back tax, fine
• Prevention: Check thresholds (CHF 120,000 / CHF 80,000 / CHF 3,000)

Tips for Error Prevention

Before Filling Out

• Create checklist: List all required documents
• Collect receipts: Salary statements, account statements, insurance confirmations, donation receipts, etc.
• Read guide: Go through cantonal guide to tax return
• Request extension: If necessary, apply online in time
• Use software: BalTax, TaxMe, VATax, etc. help avoid errors

While Filling Out

• Work carefully: Double-check all numbers
• Declare completely: Also small amounts and foreign income
• Use all deductions: Go through checklist
• Attach receipts: Copy important receipts and attach (or upload digitally)
• If uncertain: Contact tax office or trustee

After Submitting

• Keep copy: Keep tax return and all receipts for 5 years
• Check assessment: After receiving assessment decision, compare carefully with your tax return
• Appeal: If errors, file written appeal within 30 days
• Keep receipt: Archive payment confirmation

Conclusion

The tax return is complex, but most mistakes can be easily avoided. Those who observe deadlines, declare income and assets completely, use all deductions, and carefully collect receipts save time, nerves, and especially money.

The most important rules:

1. Request extension in time online (usually free)
2. Declare all income (also side earnings, foreign accounts, crypto)
3. Use all deductions (Pillar 3a, medical costs, donations, occupational expenses)
4. Collect receipts and keep for 5 years
5. Read guide and ask if uncertain
6. Check assessment carefully and file appeal within 30 days if errors

For complex situations (self-employment, property ownership, larger assets, international matters), consultation with a trustee or tax advisor is worthwhile.

Important: Even if you have made mistakes – a voluntary disclosure before discovery by the tax office significantly reduces the fine (to 1/5 instead of 1/3-3× the back tax).