Thirty days to rebuild a tax year
A discretionary assessment can be challenged only by showing that it is manifestly wrong, and the reasons have to be in the objection itself. A Federal Supreme Court judgment of June 2026 shows what that asks of a taxpayer.
When a tax return does not arrive and a reminder goes unanswered, the authority does not wait. It sets the taxable amounts itself, on a conscientious estimate, and it may take into account empirical benchmarks, the development of the taxpayer's wealth and their standard of living (Article 130(2) DBG, the federal direct tax act). This is a discretionary assessment. It is not a penalty, and it is not meant to be exact.
What changes is how it can be challenged. The federal rules ask for no reasons in an ordinary objection. An objection to a discretionary assessment can rest only on the ground that the assessment is manifestly wrong, and it must give reasons and name any evidence (Article 132(3) DBG; Article 48(2) StHG, the act that harmonises cantonal taxes). The burden has moved: the authority does not have to show that its estimate is right, and the taxpayer has to show that it is wrong.
The case
Judgment 9C_555/2025 of 25 June 2026 concerns a doctor with a practice in the Canton of Zurich and further practices in Germany. For the 2021 tax period no return was filed, despite a public request and an individual reminder. Zurich assessed taxable income of CHF 1,200,000, at the rate for CHF 1,800,000, for direct federal tax and for cantonal and communal tax, and taxable assets of CHF 200,000, at the rate for CHF 1,400,000, for cantonal and communal tax.
The objection brought the 2021 accounts of the Zurich practice, showing a profit of about CHF 353,000. The tax office refused to consider the objection, and two cantonal courts upheld that refusal.
What the courts said, and which court said it
Most of the reasoning belongs to the Zurich Administrative Court, as the Federal Supreme Court records it:
- One set of accounts did not make the estimate manifestly wrong.
Nothing had been said about family circumstances, expenses, deductions, debts, assets or income from securities. And in 2020 the same doctor had earned about CHF 1,029,000 from the Zurich practice and about CHF 564,000 in Germany, so the court saw nothing wrong in assuming that income and assets had continued to grow.
- A sworn declaration did not help.
Under Swiss tax law it is not admissible evidence. It is a party's own assertion, and it does not replace a complete return.
- Domicile came too late.
The doctor's papers were deposited in Graubünden, but the Zurich main tax domicile was disputed only on appeal. Whether an objection is admissible depends only on the objection and the documents filed with it.
- A high estimate is not a void one.
Nothing showed that the authority had deliberately acted against the taxpayer. An estimate is usually either too high or too low, and the ordinary remedy for a manifestly wrong one is the objection.
The Federal Supreme Court decided less than that. The only question before it was whether the refusal to consider the objection was lawful, so it would not set the income at CHF 353,000 as requested. It dismissed the appeal as manifestly unfounded, in the simplified procedure and with summary reasons, largely because the appeal did not properly address the cantonal reasoning. That makes it a confirmation, not a new rule.
On one point it spoke for itself. The doctor argued that the authority should have allowed extra time to repair inadequate reasons. It need not: the reasons required by law are a procedural condition, and a defect in them allows the authority to refuse the objection without more, unlike a defect in the steps of cooperation.
An objection to a discretionary assessment is not a placeholder to be completed later.
Where the rule comes from
The rule is older than this judgment, and its leading case comes from Ticino. Decided in 1997, it concerned a company that, assessed after repeated reminders, objected that it was fighting to survive and making no profit, and asked for two more months. The Ticino tax chamber took the view that documents could still follow on appeal. The Federal Supreme Court disagreed: reasons are a procedural condition, and a taxpayer cannot file a bare objection and defend the position only on appeal. The same judgment requires the authority to state this requirement, and the consequence of ignoring it, in the notice of rights (BGE 123 II 552).
The 2008 judgment that the doctor relied on says what the reasons have to contain. The proof must be comprehensive and cannot concern single items. The taxpayer has to make up the missed steps, and in particular file the missing return, within the objection period. That case also shows the limit. A company's return had been signed only by its fiduciary, which does not meet the requirement of a personal signature. But the objection was otherwise adequately reasoned, so the defect could not justify a refusal, and the court added that a formal defect of this kind would in any event call for a short period to put it right (2C_620/2007 and 2C_621/2007). That helps with a formal slip. It does not help with reasons that are missing.
If an assessment has arrived
- Count the days.
The objection is due within thirty days of notification, counted from the following day (Articles 132 and 133 DBG). A late objection is considered only if the taxpayer proves they were prevented from filing, for example by illness or absence abroad, and filed within thirty days of the obstacle ending.
- File the missing return.
It should be complete, with its attachments and the taxpayer's own signature (Article 124(2) DBG). Without it, adequate reasons are rarely possible.
- Cover the whole position.
That means employment and self-employment, activity abroad, property, investments, bank balances, debts, deductions and family circumstances.
- Leave nothing out because it is foreign.
Swiss tax does not extend to a foreign business, but foreign income can still count towards the rate, depending on domestic law and the applicable treaty (Articles 6 and 7 DBG). That is why an assessment can show two figures, as this one did.
- Raise domicile now.
If the canton that issued the assessment is not your main tax domicile, say so in the objection and explain why.
- Bring evidence, not assurances.
Every statement should be something the authority can check.
The same rules apply to cantonal and communal tax. In Ticino they are in Article 206(1) and (3) of the cantonal Tax Act.
The better moment is earlier still. A return filed when the reminder arrives is far easier than a tax year rebuilt in thirty days. We prepare tax returns for individuals, entrepreneurs and companies, and where an assessment has already been issued we help rebuild the position and prepare the objection.
Sources
Federal Supreme Court, judgment 9C_555/2025 of 25 June 2026 (simplified procedure, art. 109 BGG), on appeal from the Zurich Administrative Court, SB.2025.00038 and SB.2025.00039 of 20 August 2025. Federal Supreme Court, judgment 2C_620/2007 and 2C_621/2007 of 2 July 2008. BGE 123 II 552 of 21 November 1997.
Federal Act on the Direct Federal Tax (DBG, SR 642.11), version of 2 September 2026, arts. 6, 7, 124, 130, 132 and 133. Federal Act on the Harmonisation of Direct Taxes of the Cantons and Communes (StHG, SR 642.14), version of 1 January 2025, arts. 46 and 48. Ticino Tax Act of 21 June 1994 (RL 640.100), arts. 204 and 206.
This article is general information and is not individual tax or legal advice. Time limits and requirements must be checked against the decision received and the law applicable to the case.
This article is general information current at the date of publication. It is not advice in an individual case, and the treatment of any particular structure depends on its facts.
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