Client Expense Reimbursements on Swiss Invoices: A Practical MWST Guide

Start With Whose Expense It Is

A client asking you to pay a cost first does not make it tax-free. For Swiss MWST, ask whose name and account the expense belongs to.

The VAT Act excludes reimbursement of expenses incurred in the recipient’s name and for their account from taxable consideration, if separately shown. This is the transit-item exception in Article 24(6)(b).[1]

For example, you pay a public fee that the client owes, acting as their agent. Recover the same amount and keep the client’s instruction and the authority’s receipt. Your fee remains separate.

A software licence bought in your business’s name to perform your work is different. Recharging its price does not make it a client expense. Costs of your own supply belong in the consideration unless an exception applies.[1]

Separate a Disbursement From a Recharge

Check the engagement terms before spending. The client should have instructed or approved the purchase, and your records should show you acted for them. A general promise to reimburse business costs does not prove each was incurred in the client’s name and for their account.

Give a qualifying disbursement its own invoice line. Identify the item and, if useful, its supplier, date and client matter. Keep it distinct from labour, travel or materials so the amount can be traced to evidence.

Claim only what you paid for the client, without adding your margin. Bill any arrangement or handling work as a separate service fee and apply the MWST treatment that belongs to that service.

If the supplier billed you, or the purchase is your business input, do not call it a Durchlaufposten merely because the client agreed to pay. Read the Act’s general consideration rule with its reimbursement exception; ask a fiduciary about mixed cases.[1]

Make the Invoice and Evidence Easy to Audit

List your own work and applicable MWST separately from a qualifying disbursement. Do not calculate output tax on a transit item as if it were your fee, or use a “reimbursement” label to remove tax from your own supply.

Keep the supplier document, client approval, proof of payment and invoice together. Add a note linking them to the project. This trail shows why the expense belongs to the client rather than your operating costs.

If the supplier document includes MWST, preserve it and give the client a copy. Do not present that tax as tax on your fee or charge it twice. The client’s input-tax deduction depends on its own status and evidence.

A Swiss QR-bill collects the total; it does not decide the tax treatment of each line. Match its amount to the invoice total, including fees and disbursements, and link the payment reference to the correct invoice.

Use a Repeatable Expense Workflow

Before buying, get approval, confirm who is responsible and ask whether the supplier can name the client on the document. Record the agreed amount and any separate handling fee.

At purchase, save the invoice or receipt and proof of payment. Check the named recipient, description and amount. If your business is the purchaser, or the cost serves your work, treat it as a business cost and review its VAT treatment.

When invoicing, show a qualifying expense as a separate, exact line. Keep your fee and any administration charge distinct, apply the correct MWST treatment to each, and make the QR-bill total match the amount due.

At month-end, match the payment to the invoice and supplier evidence; use a clearing account for genuine disbursements instead of mixing them with sales and ordinary costs. The FTA publishes current VAT practice guidance.[2] Sources: [1] Federal VAT Act, Article 24; [2] FTA VAT practice publications.