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Old 23.01.2015, 17:30
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Tax: which year counts?

Hi everyone,

This question seems simple, but I haven't found an answer anywhere..

As a freelance living in Geneva, if I completed some work (for the UN) in 2014, but only got paid for it in 2015 - in which year's taxes should it be reported?

And more complicated - what if I completed 70% of the work in 2014, 30% in 2015, and got paid in 2015..?

Thanks a lot for your help!
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Old 24.01.2015, 00:35
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Re: Tax: which year counts?

Hi Botnino,

I'm also a freelance and I've also been asking myself the same question. My guess is that the year is determined by the invoice date, but maybe someone else with better knowledge can provide us with more detailed information.
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Old 24.01.2015, 01:01
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Re: Tax: which year counts?

Always the invoice date, not when it is paid out.
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Old 24.01.2015, 10:24
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Re: Tax: which year counts?

It's you actual situation on 31 December that counts.
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Old 24.01.2015, 12:22
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Re: Tax: which year counts?

are you self-employed or have GmbH?

The rule is that you account for your revenue in the period that you have done the work. So if you did work in December 2013 and send out the invoice in January 2014 (quite common) you should book that in 2013. The VAT in this example is due end of February 2014.

In GmbH you would book in 2013 the revenue (profit and loss) against work in progress (balance sheet).

Sometimes it comes in handy for tax purposes to shift part of the work in progress to the new year especially if it is not very clear when you may have done the work. The rule says that you book it when you have done the work. very simple.
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Old 25.01.2015, 17:25
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Re: Tax: which year counts?

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are you self-employed or have GmbH?

The rule is that you account for your revenue in the period that you have done the work. So if you did work in December 2013 and send out the invoice in January 2014 (quite common) you should book that in 2013. The VAT in this example is due end of February 2014.

In GmbH you would book in 2013 the revenue (profit and loss) against work in progress (balance sheet).

Sometimes it comes in handy for tax purposes to shift part of the work in progress to the new year especially if it is not very clear when you may have done the work. The rule says that you book it when you have done the work. very simple.
So what happens if lets say i buy a commodity, wheat, oil, sugar, rice, whatever in 2013, ship it in 2013 yet get paid in 2014. According to you i should book this in 2013.

Yet if i do this, i cannot reduce my taxable situation by carrying stock, which may not be a lot in some cases, but a lot in other cases.
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Old 25.01.2015, 17:35
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Re: Tax: which year counts?

if you buy stuff you can't get paid for it...

when you ship it then it is no longer stock, you will have moved to accounts receivable. What do you want to deduct? if you invoice your client in 2013 everything is accounted for in 2013 except that you receive the money in 2014 but that has no tax effect.
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Old 25.01.2015, 19:00
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Re: Tax: which year counts?

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if you buy stuff you can't get paid for it...

when you ship it then it is no longer stock, you will have moved to accounts receivable. What do you want to deduct? if you invoice your client in 2013 everything is accounted for in 2013 except that you receive the money in 2014 but that has no tax effect.
Ah good, i'll let my accountant know
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