Monetary benefit

In Swiss tax practice, a monetary benefit exists when a shareholder, related person, employee or other recipient obtains an advantage that an independent third party would not have received on the same terms. Examples include excessive salaries, below-market loans, private expenses paid by a company, or asset transfers at non-arm’s-length prices. For companies, such benefits may be added back as hidden profit distributions; for recipients, they may be taxable income or subject to withholding tax consequences. The key issue is the difference between agreed terms and market conditions.