A winning bet for border workers who have applied for quasi-resident status!

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    The main points to remember from the judgment of 3 August 2017

    In its judgment of 3 August 2017, the Court of Justice only admitted the violation of the principle of non-retroactivity of the law. Indeed, the court rejected the fact that:

    • the law is contrary to the Agreement on the Free Movement of Persons between the Swiss Confederation and the countries of the European Community;
    • the law indirectly discriminates against quasi-resident taxpayers on the basis that there are more resident taxpayers affected in absolute terms (38,235) than quasi-residents taxpayers (6,775), but also that a taxpayer living in Carouge and working in Yverdon-les-Bains is more severely affected by the ceiling on travel expenses than a cross-border worker working in Chêne-Bougeries and living in Gaillard;
    • the law violates the principles of equal treatment and taxation according to ability to pay.

    The cantonal limit on the deduction of travel expenses of CHF 500 will only be applied as of 1 January 2017.

    Therefore, the court did not annul the contested law and decided that the law would enter into force and take effect on 1 January 2017 (for 2017 income) instead of 1 January 2016 (for 2016 income).

    Except that... The GTE (Groupement Transfrontalier Européen) lodged an appeal before the Federal Court with a request for suspensive effect in the month following this ruling.

    Each of the parties (GTE members, Grand Council of the Republic and Canton of Geneva) had 30 days to appeal to the Federal Court.

    Based on several strong arguments, such as the violation of the principle of non-retroactivity of the law, indirect discrimination against frontier workers and the hindrance of free movement, the GTE filed an appeal with the Federal Court to annul the decision of the Geneva Court of Justice and the contested law.

    Is the deduction of actual transport costs still possible for the year 2018 (2017 income)?

    If the suspensive effect is granted by the Federal Court, Genevans and quasi-residents will still be able to claim the deduction of actual transport costs for their 2017 tax return. They will then have to wait for the decision on the merits, as was the case this year.

    You will soon receive your tax notice and the resulting tax refund or supplement for the year 2017 (2016 income)!

    The AFC (Administration Fiscale Cantonale) has just informed us that the tax notices of the Geneva taxpayers and quasi-resident taxpayers (who had asked to claim the deduction of real travel expenses) will be thawed (sent to the taxpayers), and this despite the appeal of the GTE before the Federal Court.

    In view of the large number of tax assessments to be sent, notifications of tax assessments will be made gradually until the end of the year.

    Romain Clapier

    Je suis le fondateur du cabinet fiscal Allo-Déclaration Suisse, un service de conseil fiscal qui se veut accessible à tous. Expert-comptable diplômé suisse de formation, je maîtrise parfaitement la fiscalité suisse et française des particuliers et notamment celle des frontaliers genevois et vaudois.

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