Facts
The complainant's husband had taken out an accident insurance policy in the event of his death or disability. After his fatal accident, the insurance sum was paid out to the widow and her minor children. The tax assessment authority made interim assessments for the military tax of the 9th period against the widow and included the compensation from the accident insurance in the calculation of the taxable income.
The widow disputed that the insurance benefits should be included in the calculation of the taxable income. However, the contested interim assessments were confirmed in the objection procedure and also declared lawful by the High Court of the Canton of Schaffhausen (as the cantonal military tax appeal commission) on the taxpayer's appeal.
Considerations
The Federal Court states that the death benefit from accident insurance is to be included as replacement income within the meaning of Art. 21 para. 1 lit. a of the Military Tax Decree, regardless of whether the claim was acquired by beneficiary designation or by inheritance. The insurance benefit is intended to provide the survivors with compensation for the permanent disadvantages resulting from the death of the insured.
The Federal Court rejects the complainant's argument that the insurance benefit constitutes an inheritance receipt within the meaning of Art. 21 para. 3 of the Military Tax Decree. It states that the insurance sum due as a result of the fatal accident can only be considered an inheritance receipt if the policyholder has not designated (or not actually designated) a beneficiary and the benefit therefore accrues to the heir. Otherwise, it is an independent right of the beneficiary, which is independent of the fate of the estate.
The Federal Court confirms that the taxation of the death benefit from accident insurance is also compatible with Art. 21a of the Military Tax Decree, which contains special provisions for the taxation of income from insurance. Accordingly,…