How much is my family holding worth?

The taxpayer (the family holding company) holds a stake in a listed company. The stock market value of the underlying stake halves, and then the price gradually recovers. Initially, the book value of the stake corresponds to the stock market value at the closing date of the accounts. Write-downs and write-ups are taken into account in the balance sheet. Subsequently, the taxpayer uses the lowest stock market value during the financial year as the book value (change in accounting method).

👉 The tax authorities adjust the book value to replace it with a higher tax value of the holding (58%) for capital gains tax purposes, although this is still lower than the investment cost.

Federal judges recall that value corrections and depreciation made to the investment cost of participations are added to taxable profit when they are no longer justified (Art. 62 para. 4 IFD). This provision is a (fiscal) corrective standard for the commercial balance sheet. However, it contains a maximum value: the investment cost of the participation.

Federal judges hold that correction of the balance sheet is required when value and depreciation corrections are no longer justified... on a sustainable basis. Consequently, the increase in value must not be temporary. There are various methods for determining whether the increase in value is sustainable, including the review of provisions, where several indicators must be considered:
The share price
▶️ Off-exchange prices paid
Share of equity in the investment
The capitalised value of regularly paid dividends
▶️ the valuation of participation using the practitioners' method.
A certain margin of discretion must be left to the tax authorities, as long as the premises are not arbitrary, generally accepted valuation methods are applied, or the result does not appear to be manifestly incorrect.

It is entirely acceptable to take into account the evolution of the stock market price up to the date of the tax assessment decision.

The judgment is in German. It is a Zurich case.

Federal Tribunal, judgment 9C_98/2025, of 4 September 2025