Input VAT on Business Expenses: What You Can Reclaim

One of the main benefits of VAT registration is reclaiming input VAT — the VAT you paid on business purchases. But not everything qualifies.

What you can reclaim

Input VAT on purchases directly used for your business — software, hardware, equipment, professional services, rent for business premises — is generally reclaimable if you are VAT-registered.

The key test is business use. If the purchase serves your taxable activity, the VAT on it can normally be deducted in your return.

Reclaiming works through your periodic VAT return: you offset input VAT against the output VAT you collected, and pay or receive the difference.

Common reclaimable items include subscriptions, office supplies, professional fees and the VAT-bearing portion of your business phone and internet.

• Business software and hardware.
• Professional and advisory fees.
• Equipment and supplies used for the business.

What you cannot

VAT on private or non-business expenses cannot be reclaimed, and some categories are excluded. Mixed-use purchases (business + private) must be apportioned.

Certain supplies are excluded by law, such as specific hospitality and entertainment costs in some situations. Check the current exclusion list before assuming.

For a mixed-use item like a phone or a car, you reclaim only the business share. The split must be defensible and consistent.

VAT shown on a pro-forma or non-compliant invoice may also be rejected. The document itself must meet the formal requirements to support a claim.

Keep the receipts

The invoice must be addressed to your business and show the VAT amount and rate. An invoice made out to a private individual cannot support your claim.

Digital records are accepted in Switzerland, so photograph or scan receipts immediately. The best record is the one you capture at the moment of purchase.

Organise receipts by period so each return has a tidy, complete evidence folder. An auditor who sees clean records will finish faster.

Timing and corrections

Input VAT is generally reclaimable in the period in which you receive the invoice. Delayed receipts can usually be claimed in a later period if still within the rules.

If you over-claimed by mistake, correct it in the next return rather than letting it sit. Voluntary corrections are viewed far more favourably than discovered errors.

Watch for invoices where the supplier charged the wrong rate. You can only reclaim the VAT actually and correctly shown, not a higher imagined amount.

facturio tracks your input VAT alongside your sales, so the net position for each return is calculated automatically from your recorded expenses.