Transfer of assets within a group and exemption from transfer tax

Facts

Pension fund X. held all the shares of real estate company B. SA. By notarial deed dated May 6, 2010, the real estate company transferred to the Foundation assets comprising five real estate parcels for CHF 17,451,842 and liabilities, namely a mortgage debt of CHF 16,091,354.60. The Cantonal Tax Administration of the Canton of Vaud set the amount of the transfer tax resulting from this transfer at CHF 574,000.

The Foundation filed a public law appeal with the Federal Supreme Court, concluding that it should be exempt from the transfer tax. The Federal Supreme Court upheld the appeal and exempted the Foundation from the disputed transfer tax.

Considerations

Article 103 of the Merger Act (LFus) is a federal provision of direct application, which does not require any concretization by cantonal law. However, the reference made by this article to Articles 24(3) and 3quater of the Harmonization of Direct Taxes Act (LHID) must be interpreted in such a way that only the concept of "restructuring" is decisive for the transfer tax, to the exclusion of the other conditions set by the LHID for the exemption of direct taxes.

The transfer of assets that took place between the Foundation and the real estate company does not constitute a merger, a transformation, or a demerger, and therefore cannot benefit from the exemption provided for in Article 103…