Lucerne Capital Tax
Last updated: 14 Dec 2025
Lucerne Capital Tax — Equity Tax Rules
How capital tax works for companies in the Canton of Lucerne: who is subject to equity tax, how the taxable capital base is determined, how the cantonal rate operates, which reliefs exist for holding and mixed companies, and how capital tax interacts with corporate income tax.
Scope & Taxpayers
- Resident companies. Capital tax applies to companies with statutory seat or effective place of management in the Canton of Lucerne (AG, GmbH, cooperatives and other juristische Personen), on their equity allocable to the canton.
- Nonresident entities. Nonresident companies with a permanent establishment or Lucerne–situs real estate are subject to capital tax on the equity attributable to those Lucerne assets and operations.
- Tax period and valuation date. Capital tax is assessed annually, based on the equity at the end of the business year, as defined in Lucerne tax law and practice. Book values are the starting point, but hidden equity may be added or adjustments made where accounts do not reflect tax values.
- Legal form. The rules on this page focus on capital companies and cooperatives. Associations, foundations and entities with ideal or charitable purpose may benefit from exemptions or separate capital tax rules.
Tax Base: Equity & Hidden Equity
For Lucerne capital tax, the taxable base is equity as defined in the cantonal tax act (share capital and reserves, open and hidden), subject to specific adjustments and reliefs.
| Component | Included? | Comment |
|---|---|---|
| Share/paid-in capital | Yes | Fully included in the capital tax base for AGs and GmbHs, based on the registered commercial register amount. |
| Open reserves | Yes | Legal reserves, voluntary reserves and retained earnings form part of taxable equity. |
| Hidden reserves (including goodwill) | Yes, in principle | To the extent that assets are carried below tax values or significant hidden reserves exist, Lucerne practice can require adjustment, particularly in restructurings, migrations or transactions with related parties. |
| Revaluation reserves | Yes | Revaluation reserves and step-up amounts become part of equity and hence the capital tax base once recorded. |
| Non-business assets | Yes | Private or non-business assets held within the company are fully subject to capital tax and may impact profit tax as well (e.g. deemed income or limited deductibility of related costs). |
| Hybrid instruments & shareholder loans | Partially | Excessive shareholder loans may be recharacterised as hidden equity under thin-capitalisation rules, increasing the capital tax base and affecting interest deductibility for profit tax. |
| Participations & IP | Yes, but often relieved | Equity attributable to qualifying participations and, in some cases, IP or intra-group loans can benefit from capital tax relief under Lucerne’s STAF-related measures, significantly reducing the effective capital tax on holding and IP-rich structures. |
The precise capital tax base is determined under the Lucerne tax act (Steuergesetz des Kantons Luzern) and cantonal practice. For groups, allocation of equity between Lucerne and other cantons or foreign jurisdictions is a critical step and should follow consistent allocation keys aligned with the group’s profit allocation.
Rates, Reliefs & Special Statuses
Standard rate & thresholds
For ordinary capital companies and cooperatives, Lucerne applies a simple capital tax rate (per-mille of equity) to the taxable equity. This simple rate is then multiplied by the applicable cantonal and communal tax factors (Steuerfüsse) to arrive at the effective cantonal/communal capital tax.
Some entities (e.g. associations and foundations) benefit from thresholds so that equity is only subject to capital tax once it exceeds specified amounts, which in practice acts as a de minimis rule for smaller non-profit structures.
Lucerne does not typically levy a separate flat minimum capital tax for ordinary companies; the burden is proportional to taxable equity, subject to rate and base reductions where applicable.
The effective burden can vary over time as the cantonal and communal tax factors are adjusted. For current figures by tax year, see:
- The official Lucerne pages on corporate taxation in Lucerne , and
- the Rates page of this hub.
Holding, domiciliary & mixed companies
Lucerne grants reduced capital tax exposure for companies with specific functions, in particular through capital tax base relief and, in some cases, reduced rates:
- Holding companies. Companies that primarily hold participations can benefit from substantial relief on equity attributable to qualifying shareholdings. Combined with participation relief on profit tax, this can result in a very low effective burden on pure holding structures.
- Domiciliary / management companies. Companies that mainly perform administration and group management in Switzerland for non-Swiss activities may qualify for reduced effective capital tax through reliefs on specific equity components and coordinated profit tax treatment.
- Mixed and IP-rich companies. For structures with material foreign business and IP, Lucerne’s STAF implementation allows targeted capital tax relief for equity linked to qualifying participations, patents and comparable rights or intra-group loans, subject to conditions and documentation.
The detailed conditions, rate levels and relief percentages are set out in the Lucerne tax act, ordinances and cantonal guidance. Larger structures typically use advance tax rulings to confirm status and the interaction of profit and capital tax.
Interaction with Profit Tax
Capital tax in Lucerne is closely coordinated with corporate income tax. A few key points:
- Same return, separate bases. Profit tax is levied on taxable income; capital tax is levied on equity. Both are calculated using the same corporate tax return for juristic persons, but with different schedules.
- Proportional profit tax, proportional capital tax. The canton applies a proportional simple profit tax rate to the taxable profit of capital companies; this is then multiplied by the same cantonal and communal tax factors that apply to capital tax.
- Reliefs aligned across taxes. Lucerne’s implementation of STAF combines instruments on the profit tax side (patent box, R&D deductions, participation relief) with capital tax relief on qualifying equity components. For holding and IP-rich structures, this alignment can strongly shift the overall burden away from capital tax.
- Planning tension. Higher equity reduces financing risk and thin-cap exposure for profit tax, but increases capital tax. Optimising the mix of equity and debt is therefore a combined profit-and-capital tax question.
- Multi-cantonal allocation. For groups with activities in several cantons, Lucerne’s share of both profit and equity is determined by allocation keys. Adjustments in allocation (e.g. shifting functions or assets) can change both capital and profit tax exposure in Lucerne.
For the profit tax side, see the Lucerne corporate tax page and the combined tax calculator.
Planning Points & Typical Cases
| Theme | Capital tax angle | Typical actions |
|---|---|---|
| Financing structure | More equity means higher capital tax but less thin-cap risk, while high shareholder debt can be challenged and reclassified as hidden equity. | Review intra-group financing; align with Swiss thin-capitalisation practice; document arm’s-length interest rates and security; model combined profit and capital tax under different equity levels. |
| Holding structures | Qualifying holding companies may enjoy substantial capital tax relief on equity tied to participations, making Lucerne a potential location for group holdings in combination with participation relief on profit tax. | Assess whether Lucerne holding criteria are met; compare Lucerne with alternative cantons; obtain rulings to secure capital tax relief and confirm interaction with participation relief. |
| IP & R&D | IP-rich companies may face higher equity and hence capital tax, but can use STAF instruments (patent box, R&D super-deduction, capital tax relief on IP-related equity) to rebalance the overall burden. | Map IP assets and functions; ensure robust valuation and cost tracking; coordinate profit and capital tax optimisation; align with substance and nexus requirements in Lucerne. |
| Real estate & non-core assets | Real estate and non-core assets often carry significant equity and hidden reserves, increasing capital tax and affecting allocation between Lucerne and other cantons. | Consider spin-offs into separate property companies; align asset location with business strategy and tax burden; review allocation keys for multi-cantonal or cross-border groups. |
| Restructurings & migrations | Changes of seat, mergers or de-mergers may crystallise hidden reserves or trigger special capital tax rules and adjustments in equity allocation into or out of Lucerne. | Plan transactions early; prepare pro-forma balance sheets and allocation scenarios; seek rulings from Lucerne and federal tax authorities on key steps. |
Compliance Snapshot
Capital tax is assessed and collected together with corporate income tax for juristic persons. For procedural detail, see the dedicated Forms & deadlines page. Key points include:
| Area | Key points |
|---|---|
| Return | Annual corporate tax return for juristic persons, filed via the Lucerne tax administration’s electronic systems or approved software, includes both profit and capital tax sections and any capital tax relief claims. |
| Deadline | Same filing deadline as for profit tax (standard deadlines are set canton-wide and can be extended on request). The equity position at year-end and capital tax base relief must be documented for the same period. |
| Documentation | Balance sheet; equity reconciliation; details of participations, IP, intra-group loans and major revaluations; analysis of hidden equity and shareholder loans where relevant; evidence for applying capital tax reliefs (e.g. participation thresholds, IP nexus, R&D documentation). |
| Assessments & objections | A single assessment covers profit and capital tax. Objections must clearly distinguish issues relating to the profit tax base, the capital tax base, the application of capital tax relief and the allocation of equity to Lucerne. |
FAQs
What is taxed under Lucerne capital tax?
Lucerne capital tax is levied on the company’s equity attributable to the canton: share capital, open reserves, retained earnings and, where relevant, hidden equity and revaluation reserves. Certain assets such as participations, IP and intra-group loans can benefit from capital tax relief, but they generally form part of the starting equity base before relief is applied.
How is the capital tax rate determined in Lucerne?
The canton defines a simple capital tax rate (per-mille of equity) for capital companies and cooperatives. This simple rate is then multiplied by the cantonal and communal tax factors (Steuerfüsse). The effective burden therefore depends both on the statutory per-mille rate and on the current factors for the company’s municipality.
Is there a minimum capital tax in Lucerne?
Lucerne does not typically levy a separate flat minimum capital tax for ordinary companies. Instead, capital tax is proportional to equity, subject to base and rate reliefs, while smaller associations and foundations may benefit from thresholds that effectively exempt low levels of equity.
Do holding companies pay capital tax in Lucerne?
Holding companies are generally subject to capital tax in Lucerne, but equity linked to qualifying participations can benefit from substantial capital tax relief. Combined with participation relief on profit tax, this can significantly reduce the effective burden on holding structures.
Can Lucerne capital tax be reduced through planning?
Within legal limits, yes. Typical levers include optimising equity vs. debt, managing the location and structure of holdings and IP, using STAF reliefs for participations and IP-related equity, and coordinating profit and capital tax planning. Any planning must be consistent with substance, transfer pricing and Swiss anti-avoidance practice.
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