How to configure Switzerland localization in Odoo

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When operating a business worldwide, it is essential to be aware of and compliant with all applicable laws and regulations. A company should be able to change its procedures even if it is expanding into a new region. At the same time, it should be able to give its subsidiaries and branches the ability to modify their business procedures in accordance with the particular laws and legal guidelines of the region to which they belong.

The significance of localization will now become apparent. There is more to localization than just translation. This makes it possible for businesses to maintain their business processes flexible by utilizing components that are distinctive to a nation, such as its currency, taxes, chart of accounts, etc.

The newly introduced localization package gives clients the ability to maximize ERP priority for their firms in Switzerland and ensures that they are in full compliance with all applicable tax and banking rules and legislation. That’s why in today’s tutorial, we will show you how to configure Switzerland localization in Odoo. So, let’s dive in!

Why is the idea of using Odoo for the online store in Switzerland appealing

Prior to the outbreak of the worldwide pandemic, Switzerland was the second most successful country in terms of online trade, behind only the Netherlands. Today, Switzerland is in the top spot; it has taken the lead. According to research that was conducted in the year 2020 by the United Nations Conference on Trade and Development, this achievement may be attributed to the following four reasons:

• The percentage of individuals who have access to the internet on a regular basis is quite high in Switzerland, with 97% of the population doing so.
• 98% of people in Switzerland are customers of at least one bank, which is a requirement for online purchases.
• Compared to the country’s size, the number of businesses operating only online is impressively large.
• In conclusion, the standard of the delivery is really near to being ideal.

Online sales reached 10.3 billion francs in 2019, making up 9% of total retail sales in Switzerland, according to the market research institute GFK and the Swiss Distance Selling Association. Of this total, 8.3 billion francs were made by Swiss e-boutiques, and 2 billion were made by e-commerce websites based outside of Switzerland.

E-commerce was notably established in the areas of technology, furniture, toys, and shoes, amongst other things, prior to the financial crisis. The health crisis substantially expedited the growth of the trend toward Swiss e-commerce, driving the Swiss to make purchases online in other industries that are typically done in stores, like food and cosmetics. This movement was driven by the crisis.

Since the beginning of the financial crisis, online sales have climbed by 20% for one out of every two different e-commerce firms, according to research conducted by the ZHAW, the Zurich School of Management and Law.

How to configure Switzerland localization in Odoo

Step 1: Configure the ISR localization modules

In Switzerland, receipts for payments are referred to as ISRs. You have the ability to print them straight from inside Odoo. There is a brand new button on the customer invoices that is referred to as Print ISR.

Only when there is a bank account that has been defined will the button to Print ISR show up on the invoice. As the bank account number, you may use CH6309000000250097798, and the CHF ISR reference maybe 010391391 at any time.

After that, you use the ISR to open a pdf.

There are two different layouts available for ISR: one with the bank coordinates and one without them. There is a choice to be made about which one to utilize, and it is possible to print the bank information on the ISR. To put it into effect, navigate to Accounting > Configuration > Settings > Customer Invoices and check the box next to “Print bank on ISR:”

Step 2: Set up ISR reference on invoices settings

You may make the process of reconciling your accounts more manageable by including the reference to your ISR on each of your invoices.

In order to accomplish this, you will need to specify the Journal that is typically used by your organization to generate invoices. Go to Accounting > Configuration > Journals, then open the Journal you wish to alter (by default, the Journal is titled Customer Invoices), click on Edit, and then open the Advanced Settings tab in the window that pops up. Choose Switzerland as the communication standard in the drop-down menu, then hit the Save button.

Step 3: Configure Currency Rate

You have the ability to do automated updates to your currency rates depending on the information provided by the Federal Tax Administration of Switzerland. To accomplish this, navigate to Accounting > Settings, activate the multi-currency setting, and then select the provider you would want to use.

Step 4: Modify and update your Odoo tax in Switzerland

Newly decreased VAT rates will take effect in Switzerland on January 1, 2018, following the implementation of new, lower rates. The standard 8.0 percent tariff will be lowered to 7.7 percent, while the special rate that applies to the hotel industry will go from 3.8 percent to 3.7 percent.

If you are using version 11.1, then all of the work has already been completed, and you do not need to take any further action.

In the event that you have already begun working on an older version, the first thing you will need to do is update the module labeled “Switzerland - Accounting Reports.” To do this, navigate to the Apps section of your device, delete the filter labeled “Apps,” and then search for “Switzerland - Accounting Reports.” Launch the module, then go to its menu and select “upgrade.”

As soon as it is finished, you will be able to begin working on the creation of new taxes for the modified rates.

Do not eliminate or make changes to the current tax rates (8.0 and 3.8 percent). You should maintain them since it is possible that you may need to employ both rates for a limited amount of time. Instead, make a note to archive them when you have finished encoding all of your transactions for 2017.

The establishment of such levies ought to be carried out in the following way:

• Taxes on purchases: make a copy of the first tax and alter its name, label on the invoice, tax rate, and tax group (effective from v10 only).
• Copy the original tax, then alter its name, label on the invoice, rate, and tax group. This applies to sale taxes (effective from v10 only). You also need to adjust the tags appropriately to: Since the VAT report now provides the details for both the old and new rates, you should set the tags to:
• Switzerland VAT Form: grid 302 base, and Switzerland VAT Form: grid 302 tax is required for the 7.7 percent tax.
• For 3.7% taxes: Switzerland VAT Form: grid 342 base, Switzerland VAT Form: grid 342 tax.

Always be sure to keep your financial status up to date. There is nothing further that has to be done if you are using version 11.1 or higher. In that case, you will also need to make the necessary adjustments to your financial circumstances.

Wrapping Up

We hope this tutorial will help you understand how to configure Switzerland localization in Odoo. The innovative nature of Switzerland is largely responsible for the country’s high standard of living. Putting a significant amount of money into research and development is standard practice for Swiss businesses, with the goal of continuously bettering their goods, services, and processes. This achievement is in part attributable to the existence of well-known research institutes as well as the capacity to successfully transform the outcomes of research into goods that can be sold.

Although Switzerland is not a member of the EU, it does have trade agreements in place with all of the countries that make up Europe. This assures that people, products, and services are all free to move about. There are a total of 41 different free trade agreements that Switzerland is a party to, making it the country with the most FTAs in the world. Investing in a sovereign nation such as Switzerland can significantly mitigate the dangers connected with expanding into new markets.