In principle, yes. But in practice, SMEs are often too profitable to trigger the mechanism. For example, if the tax authorities value the shares of a SA/Sàrl at CHF 5 million and its owner receives an annual salary of CHF 200,000, the effective cantonal and municipal tax (approximately CHF 85,000) remains below the theoretical cap of the Geneva tax shield. For the shield to apply, total income would need to be reduced to approximately 1% of the value of the shares (i.e., CHF 50,000), which involves trade-offs that must be carefully analyzed. We are available to assist you with these procedures.