Blick answers your wine questions: “Does the wine collection need to be declared for tax purposes?”

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If you drink wine regularly, you can quickly accumulate several hundred bottles in your cellar. Some wines may even gain value over the years and be sold for profit. Against this background, the question arises whether the profit from a wine collection or a possible sale should be declared for tax purposes.

We wanted to know exactly and spoke to tax expert Peter Vogt (50) from Tax Partner AG in Zurich. A fundamental distinction must be made between the possible declaration of assets and the taxation of post-sale profits as income. “Wealth tax generally covers all assets, such as money in a bank account or stocks. There are exceptions, for example, for household items, furniture or personal effects that do not need to be counted as part of the net worth,” Vogt told Blick.

The value of wines may trigger the obligation to declare them

“If furniture, such as an expensive painting, exceeds a certain value, they must be added to taxable net assets, according to a 2012 decision of the Zurich Administrative Court.” Important point: The exact threshold of this value is not specified anywhere. “In the cited case, the Zurich Administrative Court stated that a painting worth 150,000 francs was in any case among taxable assets and was not part of tax-exempt household goods.”

Collections are already subject to declaration and therefore to wealth tax. For wine collections, this means that due to the size of the collection or being above a certain value, declaration on a tax return is required even if the wines are primarily for personal use. Tax issues also arise when wine bottles are sold for profit. “What is important here, in terms of tax, is whether the wines are sold within the scope of a commercial activity. If this is the case, the profit is subject to income tax as well as the AHV contribution obligation,” explains Vogt.

In a decision made by the Federal Court in 2002, the sale of a valuable wine collection was decided on commercial grounds because the size of the collection exceeded personal use. For wine collectors who have valuable wines in their cellars, it may be useful to clarify such tax issues in advance. We hope that this will prevent unpleasant surprises in connection with possible taxation.

Source : Blick