Tax avoidance
Arrangements that seek to reduce tax within the letter of the law, but may be challenged if artificial or abusive.
Tax avoidance differs from evasion because the facts are generally disclosed and no direct filing duty is breached. It uses legal forms to obtain a tax advantage, such as choosing a transaction structure, location or financing method. Swiss tax authorities and courts may disregard arrangements that are unusual, economically inappropriate and chosen mainly for tax savings, applying an abuse-of-law approach. The boundary between legitimate tax planning and abusive avoidance is fact-sensitive. Advance tax rulings can provide practical certainty if facts are complete and accurate.