Deductions for bicycles and public transport

A, who is resident in the Canton of Zurich, makes his way to work every morning with a short 8-minute bicycle ride to the local railway station, in order to then use public transport to the destination station. All in all, the commute takes about 35 minutes. Although using a bicycle, complainant A would also be able to take the bus or even walk to the railway station.

A has a subscription to the Zurich public transport system, which he claimed as a tax deduction for the 2014 tax year. In addition, he also declared the lump-sum deduction for the bicycle of CHF 700. The local municipal tax office denied the deductibility of the lump-sum bicycle deduction on the grounds that it could not be a cumulative deduction, but only an alternative deduction in addition to the subscription. As a result, A filed an objection and a tax appeal. The Tax Appeal Court of the Canton of Zurich upheld A's appeal. However, the cantonal tax office was not satisfied with this and appealed to the Administrative Court and finally to the Federal Court. The ruling was issued in BGer 2C_745/2017 of 21 September 2017.

Classification of professional expenditures in the DGB deduction possibilities

First and foremost, the Federal Supreme Court explains the different three types of deductions in tax law. The organic deductions (also called profit costs) include, among other things, the costs for the exercise of dependent gainful employment according to Art. 26 DBG. According to the currently prevailing concept of profit costs, all "expenses incurred in the generation of income" are deductible. However, the Federal Supreme Court does not want to completely disregard the final concept of profit costs. For this reason, the Federal Supreme Court argues in favour of allowing all expenses to be deducted that are substantially caused by the generation of income (requirement of causation) and which the person concerned cannot avoid (requirement of unreasonableness).

Furthermore, the Federal Supreme Court interpreted the basis for occupational deductions in Art. 26 DBG. This norm mainly substantiates the causal concept of profit costs in that all necessary costs for journeys between home and place of work are deductible. However, the deduction is limited to CHF 3000. Based on this, an ordinance on deductions was issued, the BKV, which allows the fixed flat-rate deduction of CHF 700 for a bicycle in Art. 5 BKV.

Great freedom for taxpayers regarding the design of their commute to work

The Federal Supreme Court immediately rules out the view of the cantonal tax administration that Art. 5 BKV merely contains an alternative for the deduction of public transportation and private vehicles. According to the Federal Supreme Court, Art. 26 DBG is extremely openly formulated as the relevant standard. It is not the task of the tax authorities or tax law as such to impose rules on taxpayers regarding the organization of their commute to work. The BKV merely stipulates a preference in favour of public transport, in that private vehicles are only permitted on a subsidiary basis. Likewise, neither the law nor the ordinance stipulates that the commute to work must be made in a "pure manner" (only public or only private vehicle).

Furthermore, in the opinion of the Federal Supreme Court, a legal basis would be required if the legislator wanted to restrict the taxpayers' freedom of action in this way. Furthermore, the Federal Supreme Court is of the opinion that in practice, taxpayers' everyday lives are always characterised by longer journeys to work, which in turn makes it necessary to use several means of transport. Moreover, the Lausanne judges cannot refrain from making a sharp-tongued remark that such a restriction would not be desirable.

No preference for walking or bus travel over using the bicycle

The flat rate of CHF 700 is also not legally objectionable - such deductions are mandatory in tax law as a mass case law. However, this does not mean that the cumulative granting of the deduction is inadmissible. Since the BKV only makes a guiding preference with regard to the relationship between public and private means of transport, but not between bicycle journey/bus journey/foot march, these three variants are to be regarded as equivalent. The journey by bicycle to the place of work itself is therefore significantly related to the gainful activity. In the view of the Federal Supreme Court, it cannot be otherwise even in the case of a bicycle ride to public transport.

Based on the findings of the lower court, the Federal Supreme Court then ruled that the taxpayer prefers the bicycle to a walk in order to save 15 minutes of time. The Federal Supreme Court reprimanded the cantonal tax authorities in that the taxpayer's behaviour was deemed to be economic and ecological. By resorting to the bicycle instead of the bus, the taxpayer contributes to the fact that public transport does not have to be expanded further. Secondly, according to the Federal Supreme Court, the 700 francs are a relatively small deduction, which indicates a generous tax practice.


In this decision, the Federal Supreme Court mocks the Zurich tax authorities and vividly dissects their views on the deductibility of professional expenses. As long as the taxpayer uses another possibly private vehicle (in this case a bicycle) in addition to public transport, a deduction can be claimed cumulatively. This is different, however, if the taxpayer uses the private automobile although the use of a public means of transport would be reasonable. In this case, the law clearly only allows a limited deduction in the amount of the costs of the public means of transport. This preference is probably justified in order to relieve the burden on the roads and the environment. Nevertheless, the deductibility remains dependent on the circumstances of the individual case and, as is so often the case, leaves the tax authorities and the judge with a margin of discretion.