SWITZERLAND Law and Practice Contributed by: Olivier Sigg and Quentin Thorens, Walder Wyss
7.2 Planning Considerations The transmission of digital assets may give rise to numerous difficulties in terms of ownership, rights to information and practical possibilities of access. Therefore, it is important for a testator to plan their estate on this subject, even though the options are mainly pragmatic, including, in particular: • Recording in a secure manner all access creden- tials to online accounts and cryptocurrency wallets so that heirs are able to access and manage them upon death. Failing such arrangements, there is a real risk that the relevant information will be lost permanently and that transmission of the assets will become extremely complex, if not impossible. • Making use of platform-specific legacy settings, whereby certain service providers allow users to determine the post-mortem fate of their accounts (eg, the possibility for a Facebook account to be converted into a memorial account, or the possibil- ity given by certain providers to name a third party to access and delete data after death). • Providing trusted heirs or third parties with instruc- tions and powers enabling them to delete, preserve or otherwise manage digital accounts in accord- ance with the testator’s wishes. • Relying on specialised service providers that securely store access credentials to digital assets and, upon death, implement the measures prede- termined by the account holder. In light of the above, even though estate planning tools for digital assets are far from perfect, it is essen- tial to use them in order to achieve a situation that is as satisfactory as possible for both the deceased and their heirs.
of making use of cantonal gift tax rules to gradually transfer shares in a family business in a tax-efficient manner, thereby avoiding inheritance tax liability. Cantonal law also frequently provides incentives for the transfer of family businesses upon death, typically allowing a business to be maintained at its commer- cial (book) value in order to defer taxation of unreal- ised capital gains. A crucial consideration for business succession plan- ning is the valuation of the assets. It may prove par- ticularly relevant and challenging for private equity. In such a case, the value of the shares must be assessed pursuant to the rules set forth by the tax administra- tion. A proper valuation of assets is essential for effec- tive succession planning, in particular to avoid inad- vertently losing the benefit of available exemptions as a result of discrepancies between the taxpayer’s valuation and that adopted by the tax authorities. The valuation of the assets is also a fundamental issue where a family business is passed on to only one or certain forced heirs. It is essential to ensure compli- ance with compulsory share entitlements and, accord- ingly, the availability of sufficient assets to compen- sate those heirs who do not benefit from the transfer of the family business (cf 3. Intestacy and Forced Heirship Laws ). 9. Trusts, Foundations and Related Entities 9.1 Choice of Planning Vehicle Swiss substantive law does not provide for a domestic trust regime. Switzerland is, however, a contracting state to the Hague Convention of 1 July 1985 on the Law Applicable to Trusts and on their Recognition. Under Swiss private international law, the law gov- erning a trust is determined in accordance with the Convention. Swiss courts and authorities are therefore required to recognise trusts validly constituted under the designated foreign law, provided that the minimum requirements laid down by the Convention are satis- fied. Where a trust is valid under the applicable law and the relevant assets have been properly transferred
8. Family Business Succession Planning 8.1 Succession Strategies See 8.2 Legal and Tax Considerations . 8.2 Legal and Tax Considerations
Given that inheritance tax is governed by cantonal law, succession strategies require a case-by-case analy- sis. Common succession planning strategies consist
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