Assessment at the tax authority's discretion, tax shield, advance payments, VAT, objection: five common claims about the Vaud ACI checked, with legal bases…
The ACI is known mainly through two documents: the assessment notice and the reminder. This image reduces a public service to its collection function.
ACI stands for Administration cantonale des impôts, the Vaud cantonal tax administration. It assesses tax at cantonal and communal level. It also handles direct federal tax, which is levied for the Confederation but processed by the ACI on the basis of the LIFD (Federal Act on Direct Federal Tax). It does not manage VAT, which falls under the Federal Tax Administration (AFC).
Five common claims are examined below. Each receives a verdict, the method and the source.
"The ACI can assess you at its discretion without warning you"
Verdict: FALSE. The competent authority is the ACI, which must send the taxpayer a formal notice before any discretionary assessment.
Method, step by step:
The deadline for filing the tax return is set by the ACI. It is in principle 15 March for individuals, with the possibility of requesting an extension.
Where no return or supporting documents are filed, the ACI sends a written reminder with a new deadline.
If there is no response, it proceeds to an assessment at its discretion, based on an estimate for which it has a wide margin of appreciation. Art. 130 para. 2 LIFD and the corresponding provision of the Vaud law on cantonal direct taxes (LI) provide for this procedure.
Example: an employee in Lausanne files no return. He receives a reminder, does not react and receives a notice issued at the authority's discretion, with income estimated at CHF 95'000 whereas his actual income is CHF 82'000. He has 30 days from notification to lodge an objection, and filing the complete return within this period corrects the estimate.
A discretionary assessment therefore never arrives without prior formal notice. It can only be challenged by a reasoned objection, and the taxpayer must then prove that the ACI's estimate is inaccurate.
Step
Time limit
Detail
1. Deadline for filing the return
In principle 15 March (individuals)
The ACI sets the filing deadline; an extension may be requested. (ACI)
2. Written reminder
New deadline set in the reminder
Where no return or supporting documents are filed, the ACI sends a written reminder with a new deadline. (ACI)
3. Discretionary assessment
If there is no response to the reminder
Assessment based on an estimate, with a wide margin of appreciation for the ACI. Example: income estimated at CHF 95'000 against CHF 82'000 of actual income. (ACI)
4. Reasoned objection
30 days from notification
Filing the complete return within this period corrects the estimate; the taxpayer must prove that the ACI's estimate is inaccurate. (Taxpayer)
1. Deadline for filing the return
Time limitIn principle 15 March (individuals)
DetailThe ACI sets the filing deadline; an extension may be requested. (ACI)
2. Written reminder
Time limitNew deadline set in the reminder
DetailWhere no return or supporting documents are filed, the ACI sends a written reminder with a new deadline. (ACI)
3. Discretionary assessment
Time limitIf there is no response to the reminder
DetailAssessment based on an estimate, with a wide margin of appreciation for the ACI. Example: income estimated at CHF 95'000 against CHF 82'000 of actual income. (ACI)
4. Reasoned objection
Time limit30 days from notification
DetailFiling the complete return within this period corrects the estimate; the taxpayer must prove that the ACI's estimate is inaccurate. (Taxpayer)
A discretionary assessment requires three prior steps: the taxpayer is given formal notice before being estimated, and can correct the estimate within 30 days
Key takeaway
No discretionary assessment arrives without formal notice: the taxpayer is reminded in writing, and filing the complete return within 30 days of notification corrects the estimate.
Source: Art. 130 para. 2 LIFD and the corresponding provision of the Vaud law on cantonal direct taxes (LI) — fedlex.admin.ch / vd.ch
"The tax shield guarantees a maximum of 60% of income"
Verdict: PARTLY TRUE. The cap exists, but its scope is limited.
The Vaud tax shield limits to 60% of net taxable income the sum of cantonal and communal taxes on income and on wealth. Direct federal tax is not included in this calculation. Church taxes and other charges outside the scope are also excluded.
Method:
Add together cantonal and communal tax on income and on wealth.
Compare this total with 60% of net taxable income. For the purposes of the calculation, income from wealth is taken into account according to the applicable legislation, which uses the yield on wealth.
If the total exceeds the cap, the difference is refunded.
Example: a retiree in Morges has net taxable income of CHF 40'000 and substantial taxable wealth. His combined cantonal and communal taxes amount to CHF 26'500. The cap is CHF 24'000 (60% of CHF 40'000). The refund is CHF 2'500. These amounts are illustrative.
The process goes through the tax return: the calculation is made at assessment, in most cases without a separate form. The 60% limit does not mean that the taxpayer will never pay more, since direct federal tax is added on top. The precise conditions should be checked on the official vd.ch page devoted to tax.
"Advance payments are compulsory"
Verdict: FALSE. Advance payments are offered by the ACI, not imposed.
Each year the ACI sends an advance payment statement, calculated on the last known assessment. The taxpayer may pay them in whole or in part, modify them or refrain from paying them.
The interest regime comes down to two points:
Early payments earn remunerative interest at a rate set by the Conseil d'État (Cantonal Government), which may be very low or even zero depending on the period.
Tax not paid by the due date bears default interest, the rate of which is also set by the Conseil d'État.
The rates in force change from one year to the next and must be checked on vd.ch before any calculation. No figure is given here for lack of a verifiable source at this date.
Example: a self-employed person in Yverdon whose estimated annual tax is CHF 18'000 can pay monthly advances of CHF 1'500. If he chooses to pay nothing, no penalty is provided for in respect of advance payments. He will, however, bear default interest on the balance due after notification of the final assessment.
According to the canton of Vaud, advance payments are intended to smooth the burden and limit exposure to default interest. A taxpayer whose situation improves may adjust them upwards during the year.
"The ACI also manages the VAT of my Sàrl"
Verdict: FALSE. VAT falls under the Federal Tax Administration (AFC), on the basis of the LTVA (Federal VAT Act).
The allocation of responsibilities is as follows:
VAT return: AFC, filed in principle quarterly for taxable persons using the effective method, or half-yearly under the net tax rate method. Liability begins above CHF 100'000 of taxable turnover (art. 10 LTVA).
Profit tax and capital tax of a Sàrl: ACI, at cantonal and communal levels, to which direct federal tax on profit is added.
Self-employed persons in Vaud: the ACI assesses their income and wealth for cantonal and communal tax. Any VAT they owe remains with the AFC.
Example: after the creation of a Sàrl in Morges with share capital of CHF 20'000, the company registers in the commercial register. It registers separately with the AFC if its turnover exceeds the threshold. The ACI, for its part, will receive the annual accounts, or an interim balance sheet in the event of an early closing, in order to establish the assessment.
Confusing the two authorities exposes the taxpayer to delays in filing returns. The right contact depends on the tax concerned: ACI for direct taxes, AFC for VAT.
Criterion
AFC (Federal Tax Administration)
ACI (Cantonal Tax Administration, Vaud)
VAT – return
AFC (LTVA): quarterly under the effective method, half-yearly under the net tax rate method
Not competent
VAT – liability
Above CHF 100'000 of taxable turnover (art. 10 LTVA)
Not competent
VAT of a self-employed person in Vaud
AFC: any VAT owed remains with the AFC
Not competent
Profit tax and capital tax of the Sàrl (cantonal and communal)
Not competent
ACI: at cantonal and communal levels
Direct federal tax on profit
Not competent for processing (processed by the ACI)
ACI: levied for the Confederation but processed by the ACI (LIFD)
Income and wealth of self-employed persons in Vaud
Not competent
ACI: assessment for cantonal and communal tax
VAT – return
AFC (Federal Tax Administration)AFC (LTVA): quarterly under the effective method, half-yearly under the net tax rate method
Profit tax and capital tax of the Sàrl (cantonal and communal)
AFC (Federal Tax Administration)Not competent
ACI (Cantonal Tax Administration, Vaud)ACI: at cantonal and communal levels
Direct federal tax on profit
AFC (Federal Tax Administration)Not competent for processing (processed by the ACI)
ACI (Cantonal Tax Administration, Vaud)ACI: levied for the Confederation but processed by the ACI (LIFD)
Income and wealth of self-employed persons in Vaud
AFC (Federal Tax Administration)Not competent
ACI (Cantonal Tax Administration, Vaud)ACI: assessment for cantonal and communal tax
VAT falls under the AFC, direct taxes under the ACI: each tax of the Sàrl has its own contact
Key takeaway
For a Vaud Sàrl, the right contact depends on the tax: AFC for VAT, ACI for direct taxes on profit, capital and the self-employed person's income.
Source: Art. 10 LTVA; LIFD; Vaud law on cantonal direct taxes (LI) — fedlex.admin.ch, vd.ch
"An objection to the assessment is pointless"
Verdict: FALSE. The objection is a free legal remedy, available against the assessment notice.
Method:
Time limit: 30 days from notification of the notice (art. 132 LIFD, and the equivalent provision of the Vaud LI). This time limit cannot be extended, except in cases of restitution provided for by law.
Form: signed written document, with requests and grounds. The taxpayer attaches any missing supporting documents.
Cost: as a general rule no fees for the objection procedure.
Effect: the ACI re-examines the file. It may confirm, reduce or, in certain cases, increase the assessment if new elements justify it.
Example: an employee in Lausanne receives a notice that does not allow CHF 3'200 of actual professional expenses. He lodges an objection within the time limit, attaches the supporting documents and obtains the correction. Depending on the applicable marginal rate, the saving can reach several hundred CHF.
To our knowledge, the ACI publishes no official success rate. No percentage is therefore given. In borderline cases, a tax adviser can help assess the risk of an increase before lodging an objection.
Summary and three reflexes
Summary table:
Discretionary assessment without warning / FALSE / Respond to the reminder within the set deadline and keep proof of dispatch.
Tax shield at 60% / PARTLY TRUE / Check that the cantonal and communal total exceeds 60% of net taxable income, excluding federal tax.
Advance payments compulsory / FALSE / Adjust or suspend advance payments according to your situation, while watching default interest.
ACI manages VAT / FALSE / Send VAT returns to the AFC, annual accounts to the ACI.
Objection pointless / FALSE / File in writing, with supporting documents, within 30 days.
Three reflexes to remember:
File the return by 15 March, or request an extension before that date.
Check the notice on receipt and lodge an objection within 30 days if a deduction is missing.
Keep the ACI calendar (direct taxes) separate from the AFC calendar (VAT) for any Sàrl or self-employed activity.
For further reading, see the guide to the tax return in the canton of Vaud and the details of the Vaud income tax scales. A full worked example appears in the analysis of a Lausanne couple at CHF 120'000.
"This article is provided for information purposes only and does not constitute legal, tax or accounting advice, nor a personalised recommendation; before making any decision, please consult a qualified professional, and the publisher accepts no liability for the accuracy, currency or use of the information presented."
FAQ
ACI stands for Administration cantonale des impôts (cantonal tax administration). It assesses cantonal and communal taxes and processes direct federal tax. VAT falls under the Federal Tax Administration.
Have your assessment notice reviewed
A discretionary assessment or a disputed notice must be dealt with within 30 days. A review of the file makes it possible to check the deductions and the basis of calculation.
