VAT receipts on paper or electronic: what the CO and GeBüV require

What the VAT Ordinance clarifies about receipts

The VAT Ordinance is the Federal ordinance on value added tax. It creates no special rules of its own for electronic receipts. It refers to the general law: for the transmission and retention of paperless receipts, Articles 957 to 958f of the Code of Obligations and the Ordinance of 24 April 2002 on the Keeping and Retention of Accounting Records (GeBüV) apply.[1]

The VAT Act also builds on commercial law. The taxable person must keep their books of account and records in accordance with the principles of commercial law.[4]

The ESTV (Swiss Federal Tax Administration) sums it up like this: the paper invoice, the scanned paper invoice and the electronic invoice are treated as equivalent, because the recognised accounting principles apply to all types of accounting vouchers. For data that matters for the input tax deduction, proof of origin and of integrity must be provided, whether the data is on paper or in electronic form. This proof is deemed to be provided if the recognised accounting principles under Art. 957 ff. of the Code of Obligations (CO) are met.[5]

The rules of CO Art. 957 to 958f

The Code of Obligations governs accounting. It defines an accounting voucher broadly. This covers any written record on paper or in electronic or comparable form that is required to be able to verify the business transaction or the circumstances behind an accounting entry.[2]

Accounting follows the recognised accounting principles. These include the complete, truthful and systematic recording of transactions and circumstances; 2. documentary proof for individual accounting procedures; 3. clarity; 4. fitness for purpose given the form and size of the undertaking; 5. verifiability.[2]

On retention, the CO says: the accounting records and the accounting vouchers, together with the annual report and the audit report, must be retained for ten years. The retention period begins on expiry of the financial year.[2] The form is free. Records and vouchers may be retained on paper, electronically or in a comparable manner, provided that correspondence with the underlying business transactions and circumstances is guaranteed and provided they can be made readable again at any time.[2]

For VAT, the limitation period also applies. Limitation means that after a certain time the tax can no longer be claimed. You keep your records until the absolute limitation period expires (10 years after the end of the tax period in which the tax claim arose).[7] For immovable property, the period is longer. The law requires records relating to subsequent input tax deduction and own use of immovable goods to be retained for 20 years.[4] In its practice, the ESTV even mentions retaining business documents relating to immovable goods for 26 years, with a view to possible changes of use, audits, controls and so on.[8]

What the GeBüV requires for electronic receipts

The GeBüV is the Ordinance on the Keeping and Retention of Accounting Records. It sets out how you retain records and vouchers technically. The core is in Article 3: accounting records must be kept and retained, and accounting vouchers must be recorded and retained, in such a way that they cannot be changed without this being detectable.[3]

Receipts must also stay accessible. Until the end of the retention period, an authorised person must be able to inspect and check them within a reasonable time. The relevant staff, devices and aids must be kept available for this.[3]

The GeBüV distinguishes two kinds of storage. First, unalterable information carriers are permitted, in particular paper, image carriers and unalterable data carriers.[3] Alterable carriers such as hard disks are also allowed, but only under conditions. Among other things, you need technical procedures that guarantee the integrity of the stored information (e.g. digital signature procedures).[3] Integrity here means that the data is complete and unchanged. In addition, it must be possible to prove the time of storage in a way that cannot be falsified, for example with a time stamp. The processes and procedures for using these tools must also be defined and documented.[3]

The duty does not end with saving. The information carriers must be checked regularly for integrity and readability.[3] You may transfer data to another format or another storage medium. This is called data migration. The completeness and accuracy of the information must remain guaranteed. The transfer of data from one information carrier to another must be logged. The log must be retained together with the information.[3]

Scanning a paper receipt and disposing of the original

Many SMEs scan receipts and throw the paper away afterwards. The ESTV describes exactly this case. In its example, supplier invoices are scanned on arrival, saved as PDF files and processed electronically, and the original invoices are then destroyed. The result: the electronic receipts are treated as equivalent to paper receipts and are accepted as evidence if the recognised accounting principles and all requirements of the GeBüV are met.[6]

The risk is yours. The undertaking subject to the retention duty bears the risks associated with destroying the original information carrier. Besides proper accounting, for electronic data relevant to VAT the principles of proper data processing must also be guaranteed (Art. 2 para. 2 GeBüV).[6]

The ESTV points out that its practice changes. It asks you to always check the latest version of a practice publication.[6]

What must be available at a VAT audit

The Federal Act on Value Added Tax authorises the ESTV to carry out VAT audits (Art. 78 VAT Act). The VAT audit generally takes place at your domicile during normal business hours. As a rule, all completed tax periods that have not yet become time-barred are audited, which usually corresponds to four calendar years.[7]

If you keep your receipts electronically, you must give access. It may be necessary to give the VAT tax expert access to data carriers other than paper. In that case, the necessary aids must also be made available to the expert, and their use must be explained.[7]

The audit trail is important. An audit trail means tracing business transactions from the individual receipt through the accounts to the VAT return, and in the opposite direction as well. It must be guaranteed at any time without delay.[7] You can read how your return comes about on the page on the VAT return.

A short checklist for your filing

• Every entry has a receipt. The CO requires documentary proof for individual accounting procedures.[2]
• Your receipts carry account coding and payment notes.[7] Account coding means that the receipt shows which account it was booked to.
• Records and receipts are arranged in order, without gaps, and filed systematically by financial year.[7]
• Changes to electronic receipts can be detected, as Art. 3 GeBüV requires.[6]
• You check your storage regularly for integrity and readability.[3]
• If you change systems, you log the transfer of the data.

You can find more on how to file receipts digitally on the page on scanning receipts.