Companies and self-employed people will have more time to offset their tax losses against future profits. The carryforward period is being extended from seven to ten years. According to a press release reported by Startupticker.ch, the Federal Council has set the planned entry into force of this reform for 1 January 2028. Start-ups are among the main announced beneficiaries, owing to their long development and investment phases.
What current law provides
Today, legal entities and self-employed people can offset the losses of one financial year against the profits of the following years, but only for a period of seven years. Once that period has elapsed, a loss that has not yet been offset can no longer be deducted.
The reform extends this period to ten years. It applies to the two categories of taxpayers already covered by the current rule: businesses organised as legal entities and self-employed workers.
A motion born during the pandemic
The reform has its origins in the Covid-19 crisis. The Economic Affairs and Taxation Committee of the National Council (EAC-N) had tabled a motion (21.3001) to extend this period and support companies put in difficulty by the pandemic. According to the source, Parliament adopted this motion in 2022 and referred it to the Federal Council.
The next step was to amend two federal acts: the Federal Act on Direct Federal Taxation (DFTA) and the Federal Act on the Harmonisation of Direct Taxes at Cantonal and Communal Levels (StHA). This dual basis reflects the scope of the rule: it applies to direct federal tax and, through tax harmonisation, to cantonal and communal taxes.
According to the source, the referendum period expired unused in April 2026. The Federal Council has just announced the planned date of entry into force: 1 January 2028.
Which losses are covered
The key point lies in the transitional provisions. From 1 January 2028, the ten-year period will apply to losses incurred from the 2020 tax period onwards. For losses prior to 2020, the period remains seven years, as it is today.
In practical terms, the reform therefore covers the years marked by the pandemic, which matches the original aim of the motion. Older financial years remain subject to the current regime. To find out how these rules apply to a specific situation, one must refer to the legal texts and the competent tax administration. The source does not detail the calculation methods.
Why start-ups are on the front line
A young technology company often accumulates losses for several years before making its first profits: product development, recruitment, market launch. With a seven-year period, some of these losses may expire before the company becomes profitable. It can then no longer deduct them from its taxable profits.
The source cites three groups that benefit from the extension: start-ups in the development phase, companies with long investment cycles and those that are only gradually recovering from economically difficult years. Three more years widen the window during which start-up losses can still be offset.
What remains to be watched
As the referendum period has expired, the principle of the reform is no longer contested. The date of 1 January 2028 is the one the Federal Council has announced for the entry into force. The Federal Council's original press release is not linked in the source. The implementation details will need to be checked in the texts published by the Confederation.
