We share survey highlights across three key areas: service offering, operating models and technical tax expertise.

In brief

• Client tax reporting is becoming a core service expectation, driven by regulatory complexity, cross-border activity and client demand.
• Swiss banks use hybrid operating models, combining in-house capabilities with managed services and tax watch solutions to balance quality and scalability.
• Our full analysis and insights extend beyond the current landscape to outline a path forward for banks to support tax-aware financial strategies.

Disruptive market changes are forcing banks to reimagine their operating models and address new tech-driven risks and opportunities, client demands and regulatory challenges.

Within client tax reporting (CTR) specifically, these global trends coincide with an overall market shift: some key providers are centralizing their activities in Europe and others are moving entirely to the cloud. At the same time, in an increasingly complex tax landscape, CTR is rapidly evolving from a premium service for offshore banked clients to a must-have element of exceptional client service. Indeed, while the perceived quality or coverage of CTR is rarely a pull factor for clients entering into a new banking relationship, our experience is that clients may leave banks that consistently provide inaccurate or delayed reporting.

As an experienced market leader in tax managed services, EY Financial Services Tax Switzerland wanted to understand the key trends in client tax reporting amid this wider picture of market, sector and business landscape transformation. With the first ever EY Client Tax Reporting Survey in Switzerland, we set out to capture an independent view of where the market stands today. Quantitative and open-ended questions were combined to enable benchmarking and a deep-dive analysis in three key areas of client tax reporting:

• Service offering
• Operating models
• Tax watch services

Service offering

Banks in Switzerland tailor client reporting to meet demand and regulatory requirements across jurisdictions. Responses to questions about reporting type highlight the Swiss market focus and reveal potential for business development in an evolving tax landscape.

Our survey focused on the three main types of report offered by financial institutions in Switzerland:

• Country-specific tax reports, which apply the tax rules and formats of a particular jurisdiction to enable local tax compliance
• Generic reports, which follow standardized calculation methods to provide indicative tax information for markets without a dedicated country-specific solution
• Simulation reports, which model potential tax outcomes based on current holdings and market values

Swiss financial institutions currently prioritise country-specific client tax reporting, with 100% of respondents providing country-specific reports for Switzerland. Generic client tax reporting (offered by 63% of respondents) remains useful for smaller, non-European markets with less need for customized solutions. Although not yet widely offered, tax simulation reports are emerging as a valued service — particularly for UK clients; we anticipate growing demand in the UK and other European markets due to changes in tax law, including the introduction of capital gains taxes on financial transactions in Belgium and the Netherlands.

Expanding country coverage and offering onshore or simulation reporting for branches or subsidiaries outside Switzerland increase the need for specialist expertise, robust quality assurance (QA) processes and efficient outsourcing models.

Operating models

Banks determine the right model based on available resources, reporting scope and strategic priorities. There are three main delivery models adopted by financial institutions for client tax reporting:

• In-house solutions, with resources and expertise covered entirely by the organisation’s own full-time employees (FTEs)
• Managed services, where an outsourcing provider delivers the reports to the financial institution for onward distribution to clients
• Hybrid approaches, combining in-house capabilities with external resources

Over two-thirds (68%) of institutions now use a hybrid client tax reporting production model, combining in-house resources for Swiss reports with managed services for other jurisdictions to balance control, flexibility and expertise.

Core banking systems dominate in-house models, while managed service providers contribute deep tax expertise and leverage ready-made technology solutions such as Regnology’s EasyTax or Tech Mahindra’s SaveTax.

We note that cloud adoption is increasing as leading providers migrate to cloud-based platforms and confidence in Swiss data protection standards continues to grow.

Technical tax expertise

High-quality client tax reporting requires access to global, multi-jurisdictional tax expertise as part of a robust quality assurance framework. Banks typically achieve this through a combination of in-house tax knowledge, external tax advisors and tax watch services.