Services for NGOs

The CAGI assists international non-governmental organizations (NGOs) already established or wishing to do so in the Geneva region.

Direct taxes

Associations and foundations are subject to cantonal and communal tax (ICC) and direct federal tax (IFD) on profits and capital, as well as additional property tax for those who own real estate located in the canton of Geneva.

Calculate the amount of tax on the website of the canton of Geneva

Under certain conditions, legal persons pursuing goals of public utility or public service may be exempted from:

  • direct federal tax , governed by the Federal Law on Direct Federal Tax (LIFD) of December 14, 1990. The exemption is granted on the profit only, for an indefinite period with the possibility of revision at any time.
  • cantonal and municipal tax , governed by the Law on the taxation of legal persons (LIPM) of September 23, 1994. The exemption is granted on the profit and the capital for an indefinite period with the possibility of revision at any time (transition from a fixed period of 10 years to an indefinite period since November 1, 2015).

NGOs can jointly apply for exemption from direct federal tax and cantonal-municipal tax. The fact of benefiting from an exemption at the cantonal level does not automatically entail the exemption at the federal level.

Procedure

This request must be written and sent to the Tax Department of the Cantonal Tax Administration (P.O. Box 3937, 1211 Geneva 3).

This request must contain the tax exemption request form, the articles of association in French as well as all the required documents indicated in the form.

The procedure lasts about 3 months after receipt of all the documents. The tax administration takes the final decision on the exemption. If the exemption is refused, the interested party can contest it.

Terms

The statutes must imperatively mention a non-return clause in the event of the dissolution of the association:

Model of statutes
The CAGI offers a model of statutes of association available to any non-profit entity wishing to settle in Geneva or its surroundings, and to constitute itself in the form of an association under Swiss law.

  • “In the event of dissolution of the institution, the available assets will be entirely allocated to an institution pursuing a public interest goal similar to that of the association and benefiting from tax exemption. Goods may not return to the physical founders or members, nor be used for their benefit in whole or in part and in any way whatsoever.

The articles of association must also mention the following two compensation clauses:

  • “The members of the committee of the association or of the Foundation Council act on a voluntary basis and can only claim compensation for their actual costs and their travel expenses. Any attendance fees cannot exceed those paid for official commissions. For activities that exceed the usual scope of the function, each member of the committee may receive appropriate compensation.”
  • “Paid employees of the institution may only sit on the committee of the association or the Foundation Board in an advisory capacity.”

It is required that at least one member of the Committee or member of the Council, with signing power, be a Swiss citizen or a citizen of an EU or EFTA member state and resident in Switzerland.

Organizations benefiting from an exemption remain subject to tax declarations. (See: “ 2020 Declaration Guide )“.

One of the main advantages of the tax exemption is that natural or legal persons who make a donation to an NGO benefiting from tax exemption for purposes of public utility or public service and which has its registered office in Switzerland will be able to deduct this donation from their tax return. Natural persons can deduct up to a limit of 20% of net income and legal persons up to 20% of net taxable profit.

Donations in cash or in assets (movable or real estate assets, receivables, intellectual property rights) are deductible. On the other hand, statutory contributions and other compulsory payments are not deductible, nor are gifts provided in the form of work.

The NGO must establish, for the attention of the donor, a certificate of donations it has received when the amount is greater than or equal to CHF 300.

Some institutions are exempt from inheritance tax. According to Article 6 of the Inheritance Tax Act of November 26, 1960:

“The institutions of heirs, legacies and other donations mortis causa to legal persons having their registered office in Switzerland, which are exempt from taxes on profits and on capital, are exempt from all duties, for any inheritance, on account of their purpose of public service, public utility, worship, or to the Confederation, the cantons, the communes and their establishments.

Certain institutions are exempt from registration fees on certain acts or transactions (cf. Law on registration fees (DE) of 9 October 1969).

Thus, in the case of a donation, “donations to legal persons having their registered office in Switzerland are exempt from all duties, which are exempt from taxes on profits and on capital, because of their purpose of public service, public utility, worship, or to the Confederation, the cantons, the communes and their establishments” (cf. art. 28 LDE).

In the event of a promise to purchase (art. 51 LDE), purchase (art. 42 LDE), exchange (art. 74 LDE) of real estate or even a mortgage loan (art. 89 LDE), the exemption registration fees are pronounced when the operation carried out is carried out for the purpose of public utility, public service, or even worship by a legal entity having its registered office in Switzerland, which is exempt from taxes on profits and on capital, because of its purpose of public service, public utility, worship, or by the Confederation, the cantons, the communes and their establishments.

In the case of real estate purchases and exchanges, the maintenance of the exemption requires compliance with a period of 2 years for the assignment of the building to the purpose pursued and a period of 3 years for effective continuing assignment.

Useful documents

Other useful information for NGOs

Annual legal requirements
VAT
Intellectual property and data protection
Pro bono legal assistance

CAGI services
for NGOs and Permanent Missions

Founded by the Swiss Confederation and the Republic and Canton of Geneva, the Geneva Welcome Centre is the single entry point for the support and integration of employees of International Geneva and their families, NGOs and visiting delegates.