Corporate tax in Switzerland

Summary

Corporate Income Tax Rate (%) 12 to 24 (a)
Capital Gains Tax Rate (%) — (b)
Branch Tax Rate (%) 12 to 24 (a)
Withholding Tax (%) (c)
Dividends 35
Interest 0/35 (d)
Royalties from Patents, Know-how, etc. 0
Branch Remittance Tax 0
Net Operating Losses (Years)
Carryback 0 (e)
Carryforward 7 (e)

a) The rates reflect the maximum aggregate effective tax burden of ordinarily taxed companies and are composed of federal, cantonal and communal (municipal) taxes. Approximately 7.8% of the rates relate to the federal tax. The rates depend on the canton and commune in which the taxable entity per forms its activities. Lower rates are available for privileged companies described in Section E.

b) See Section B.

c) The withholding tax rates may be reduced under the Switzerland-European Union (EU) agreement (see Section E) and under double tax treaties (see Section F).

d) Withholding tax is levied on bank interest, but normally not on interest on commercial loans, including loans from foreign parents to Swiss subsidiaries.

e) Income of the current year may be offset against losses incurred in the pre­ceding seven years. Losses may not be carried back (see Section C).

Taxes on corporate income and gains

Income tax. Switzerland is a confederation of 26 cantons (states). Taxes are levied at the federal and cantonal/communal levels. As a result of this multilayered tax system, no standard tax rates exist. Under the Swiss income tax system, earnings are taxed at the cor­porate level and, to the extent profits are distributed as dividends, again at the shareholder’s level. However, see Dividends for details regarding the participation exemption.

In general, a resident corporation is a corporation that is incor­porated in Switzerland. In addition, a corporation incorporated in a foreign country is considered a resident of Switzerland under Swiss domestic law if it is effectively managed and controlled in Switzerland.

Resident companies are subject to corporate tax on worldwide income. Income realized by a foreign permanent establishment of a Swiss company or derived from foreign real estate is excluded from taxable income. Losses incurred by a foreign permanent establishment are deductible from taxable income. How ever, if a foreign permanent establishment of a Swiss company realizes profits in the seven years following the year of a loss and if the permanent establishment can offset the loss against such profits in the foreign jurisdiction, the Swiss company must add the amount of losses offset in the country of the permanent establishment to its Swiss taxable income.

A company not resident in Switzerland is subject to Swiss income tax if it has a permanent establishment in Switzerland.

Tax Harmonization Act. The Tax Harmonization Act (THA) sets cer tain minimum standards for cantonal/communal taxes. How­ever, cantonal/communal tax rates are not harmonized under the THA.

Rates of corporate tax. The federal corporate income tax is levied at a flat rate of 8.5% of taxable income. Because taxes are deduct­ible, the effective federal corporate income tax rate is approxi­mately 7.8%.

Cantonal/communal tax rates vary widely. The cantonal/communal tax rates are usually a certain percentage (known as “multipliers”) of the relevant cantonal statutory tax rates. The total effective maximum tax burden, which consists of federal, cantonal and communal taxes, ranges from 12% to 24%, depending on the can­ton and commune in which the taxable entity is located.

Tax incentives. In Switzerland, tax incentives are granted to com­panies either by the cantons or by both the cantons and the fed­eration. Except for the limitation on the duration of tax incentives to a maximum period of 10 years, the cantons are autonomous in granting cantonal/communal tax incentives to the following:

  • Newly established enterprises
  • Existing companies that substantially change their business if such change corresponds to the incorporation of a new enterprise

Tax incentives at the federal level require approval of the federa­tion. Incentives at the federal level are governed by the federal law on regional policy. The following are the criteria for granting federal incentives:

  • Establishment of new business activities in a qualifying area of economic development
  • The performance by the applying company of industrial activi­ties or services that have a close nexus to production activities
  • Creation of new jobs either directly or indirectly (through its suppliers and/or partners) or preservation of existing long-term jobs in a changing business environment
  • Particular economic relevance of the planned project for the area

The federation and the cantons grant partial or full tax holi­days. The federation only grants holidays in qualifying areas of Switzerland.

Capital gains. Capital gains are generally taxed as ordinary busi­ness income at regular income tax rates. Different rules may apply to capital gains on real estate or to real estate companies at the cantonal/communal level.

Capital gains derived from dispositions of qualifying investments in subsidiaries qualify for the participation exemption. Under the participation exemption rules for capital gains, the parent com­pany must sell a shareholding of at least 10% and, at the time of the disposal, it must have held the shares for at least one year (for further details regarding the participation exemption, see Dividends).

Administration. Income tax is generally assessed on the income for the current fiscal year, which corresponds to the corporation’s financial year. The financial year need not correspond with the calendar year. Corporations are required to close their books once a year and file annual returns. This rule does not apply to the founding year. Consequently, the first fiscal year can be extended up to a maximum of nearly two years.

The cantonal deadlines for filing the corporate tax return vary, and extensions may be obtained. The federal and cantonal tax returns are generally filed together.

Corporations pay income tax in one lump-sum payment or in installments. The deadline for the payment of federal income tax is 31 March of the year following the fiscal year. The deadline for cantonal/communal taxes is usually between 30 June and 31 Decem ber.

Dividends. Dividends received are taxable as ordinary income. How ever, under the participation exemption rules, the federal tax liability is reduced by a proportion of dividend income (as de­fined by the law) to the total taxable income if the recipient of dividends satisfies any of the following conditions:

  • The recipient owns at least 10% of the shares of the distributing corporation.
  • The recipient has a share of at least 10% of the profits and reserves of the distributing corporation.
  • The recipient holds shares with a market value of at least CHF1 million.

The participation exemption also applies at the cantonal/com-mun al level. However, income received by qualifying holding, domiciliary or mixed companies is fully exempt from cantonal/ communal corporate income taxes (see Section E).

Swiss companies distributing dividends or proceeds from liqui­dation exceeding the nominal share capital and the capital contri­bution reserves are generally required to withhold tax at a rate of 35%. Under the Net Remittance Pro cedure, Swiss companies distributing qualifying dividends may apply the treaty withhold­ing rates prospectively without making the full 35% prepayment. The Net Remittance Procedure applies to dividends distributed on “substantial participations.” These are participations that qualify for an additional reduction or a full ex emption from Swiss with­holding tax under a comprehensive income tax treaty or under the Switzerland-EU agreement (see Section E). To distribute divi­dends under the Net Remittance Procedure, companies must file an application with the Swiss Federal Tax Administration before distributing dividends, as well as a notification form no later than 30 days after the due date of the dividend.

Under the capital contribution principle, which entered into force on 1 January 2011, contributions to equity made by a shareholder on or after 31 Decem ber 1996 can be distributed without triggering withholding tax consequences, provided certain requirements are met.

Intercantonal tax allocation. If a company operates in more than one canton, that is, the head office is in one canton and permanent establishments are in other cantons, its taxable earnings are allo­cated among the different cantons. The allocation method depends on the type of business of the company. The determination of the method is based on case law, which is governed by a constitu­tional guarantee against intercantonal double taxation.

Foreign tax relief. Income from foreign permanent establishments of a Swiss company is not taxable in Switzerland. The interna­tional allocation of profit is based on intercantonal rules, unless a tax treaty provides for a different method. For the treatment of losses of foreign permanent establishments, see Income tax.

Determination of taxable income

General. The net profit shown in commercial financial statements generally serves as the basis for income taxation. However, the tax authorities may require adjustments to correct for certain items such as excessive depreciation and provisions.

Federal and cantonal/communal corporate taxes paid or due are deductible for corporate income tax purposes.

Inventories. Any system of inventory pricing that is in accordance with accepted business practice and is used consistently by the tax­payer is presumed to be acceptable by the tax authorities.

Provisions. Swiss federal and cantonal regulations provide that a company may record a general tax-deductible reserve amounting to one-third of the inventory valuation.

Provisions to cover doubtful accounts receivable and expected lia­bilities are generally allowed for tax purposes if they are commer­cially justifiable.

In general, a reserve of 5% of accounts due from Swiss debtors and 10% of those due from foreign debtors is allowed, without sub­stantiation. In addition, provisions for specific accounts may be established if economically justifiable.

Depreciation. Depreciation may be calculated using the straight-line or the declining-balance method. For federal tax purposes, the following are some of the maximum rates set forth in the official guidelines.

Asset Method
Declining-balance (%) Straight-line (%)
Commercial buildings 3 to 4 1.5 to 2
Industrial buildings 7 to 8 3.5 to 4
Office furniture 25 12.5
Office machines 40 20
Data-processing equipment 40 20
Machinery 30 15
Motor vehicles 40 20
Intangibles 40 20

Some cantons have particularly favorable provisions (for example, immediate or one-time depreciation).

Relief for losses. Income of the current year may be offset against losses incurred in the preceding seven years, to the extent that such losses have not yet been used to absorb profits of prior years. No loss carryback is allowed.

Groups of companies. Except for value-added tax purposes, the concept of a consolidated or group return is unknown in Swiss tax law. Each corporation is treated as a separate taxpayer and files its own return.

Other significant taxes

The following table summarizes other significant taxes.

Nature of tax Rate (%)
Value-added tax (VAT), on deliveries of goods
and services, including imports of goods and
the purchase of services and (in very specific
cases) of goods from foreign businesses that
are not registered for VAT in Switzerland
Standard rate 8
Hotel and lodging services (overnight
stays only)
3.8
Preferential rate (applicable to items
such as foodstuffs, farming supplies,
agricultural products, medicines and
newspapers)
2.5
Exports 0
Net equity tax
Federal rate 0
Cantonal/communal rates (varies among
the cantons and depends on the relevant
tax regime and, if applicable, the multiplier
applied by the canton/commune); the
cantons can provide that the corporate
income tax can be credited against the
cantonal/communal equity tax
0.001 to 0.525
Payroll taxes
Social security contributions, on gross salary;
paid by
Employer 5.15
Employee 5.15
Company pension fund; rate varies by plan
(compulsory and optional), gender and age
of employee; paid by
Employer (must bear at least one-half of the
contribution)
3.5 to 9
Employee 3.5 to 9
Unemployment insurance, imposed on annual
gross salary
Gross salary up to CHF126,000; paid by
Employer 1.1
Employee 1.1
Gross salary from CHF126,001
(uncapped); paid by
Employer Additional 0.5
Employee Additional 0.5
Family allowance; paid on salary by employer;
imposed by various cantons at different rates
0.1 to 4
Maternity insurance (only for some cantons) Various
Accident insurance; rates vary depending on extent of coverage and the risk of the business; imposed on annual gross salary of up to CHF126,000
Occupational; paid by employer; for extremely high risks, rates vary depending on various factors (for example, industrial sector of the
employer)
Various
Non-occupational; employer may elect to charge all or part of these premiums to employees; for extremely high risks, rates vary depending on various factors (for example, industrial sector
of the employer)
Various
Stamp duties
One-time capital contribution tax, on Swiss shares
(the rate is 0% for shares issued within the scope
of qualified mergers and reorganizations, as well
as for financial reorganizations, provided specific
requirements are met); for incorporations and
capital increases, the first CHF1 million is
exempt from tax
1
Securities turnover tax; on the sale or exchange
of taxable securities involving a Swiss-registered
securities dealer (as defined by the law) that acts
in the capacity of a broker or dealer or that trades
on its own account; the onus for payment of the
securities turnover tax is on the Swiss securities
dealer, but it is customary that the securities
turnover tax be charged to the ultimate buyer
and/or seller; several types of parties are exempt,
including investment fund managers and foreign
companies listed on a recognized stock exchange;
several types of transactions are exempt, including
the brokering of foreign bonds between foreign
parties and qualifying internal group transactions
Securities issued by a Swiss party 0.15
Securities issued by a foreign party 0.3
Stamp duty, on redeemable capital insurance
with single premium for Swiss policyholders
2.5

Miscellaneous matters

Domiciliary and mixed companies. Domiciliary and mixed com­panies are primarily engaged in activities abroad. The profits de­rived by these companies from non-Swiss sources are taxed at substantially reduced rates at the cantonal/communal level. Dom­iciliary and mixed companies can be used for sales, financing, holding of intellectual property and other activities focusing pri­marily on non-Swiss markets. Relief at the federal level is avail­able for principal companies (see Principal companies) with suf­ficient substance.

Under the THA (see Section B), for cantonal taxes, the following tax rules apply to domiciliary and mixed companies:

  • Income derived from a qualifying participation (10% of the share capital, 10% of the profit and reserves or fair market value of CHF1 million), including capital gains resulting from step-ups in the tax basis of such investments, is exempt from tax.
  • Income derived from Swiss sources not described in the item above is taxed at ordinary rates (this rule applies only to mixed companies because domiciliary companies do not derive Swiss-source income).
  • Income derived from non-Swiss sources is also taxed at ordi­nary rates. However, the tax base is substantially reduced by the application of rules that take into account the significance of administrative activities performed by the Swiss company (this depends on the intensity of its physical presence in Switzerland and the level of its economical affinity to Switzerland). As a re­sult of these rules, approximately 10% to 30% of the non-Swiss income is subject to the ordinary cantonal and municipal tax, while the remaining non-Swiss income is exempt from tax.

Holding companies. Holding companies may take advantage of a special status for cantonal and communal tax purposes. At the cantonal/communal level, in general, holding companies are ex­empt from corporate income tax (only income from Swiss real estate is ordinarily taxed). Consequently, all types of in come de­rived from financial participations, such as dividends, interest and capital gains, are exempt at the cantonal/communal level. At the federal level, tax relief is granted with respect to qualifying divi­dends and capital gains (see Section B).

Currently, holding companies are prohibited from performing any commercial activities in Switzerland (this implies that they could do so abroad; however, this is rare).

Service companies. For Swiss resident companies providing coor­dination or management services to a multinational group (techni­cal, administrative or scientific assistance including research and promotion activities), Swiss tax law requires that a share of the profits accruing to the group be allocated to the Swiss company. Switzerland applies the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing Guidelines for Multi­national Enterprises and Tax Administrations.

Principal companies. Federal guidelines provide special rules for international profit allocation of principal companies at the feder­al level. A Swiss company within an international group is treated as a principal company if it assumes risks and responsibilities for certain activities, including the following:

  • Purchasing
  • Planning of research and development (R&D), manufacturing and distribution
  • Development of marketing strategies
  • Logistics
  • Treasury
  • Finance
  • Administration

In structures involving principal companies, manufacturing is typ­ically performed outside of Switzerland by group companies or third parties on a contract manufacturing or cost-plus basis on the in struction of and for the account of the principal. Sales are made exclusively in the name of international group distribution com­panies for the account of the principal company. These distribution companies must act exclusively as agents with the authority to conclude contracts on behalf of the principal company (commis­sionaires) or as limited-risk (stripped-buy/sell) distributors because of the related risks borne by the principal.

The federal guidelines can result in an attractive combined federal and cantonal/communal effective tax rate that may be as low as ap proximately 5% to 10%, depending on the particular set-up and the location. In addition, depending on the substance and the loca­tion, principal companies may qualify for tax holidays of up to 10 years.

The cantonal tax authorities are responsible for assessing and col­lecting the federal income tax in Switzerland and therefore grant tax rulings regarding the taxation of Swiss principal companies. However, the principal rulings must also be submitted to the Swiss Federal Tax Administration (SFTA) for approval. In 2014, the SFTA confirmed new interpretation guidelines for the cantonal tax authorities to ensure a consistent application of the existing SFTA’s circular letter 8, dated 18 December 2001, which contains the guidelines for the taxation of Swiss principal companies for federal income tax purposes.

The new interpretation guidelines refer to the following:

  • Exclusivity of distributors
  • Remuneration of distributors
  • Outsourcing of principal functions
  • Mutual agreement procedures and advance pricing agreements (APAs)

Debt-to-equity rules. Under the federal thin-capitalization guide­lines, which are also applied by most cantons, the minimum cap­italization is calculated based on the maximum indebtedness of all of the assets. For each type of asset, only a specified percent­age may be financed with debt from related parties (directly or indirectly). Consequently, the debt-to-equity ratio results from the sum of the maximum amount of indebtedness of all of the assets. The following are examples of the maximum percentages of indebtedness:

  • Cash: 100%
  • Accounts receivable: 85%
  • Participations: 70%
  • Manufacturing plants: 70%
  • Intangibles: 70%

The required equity is calculated at the end of the year based on the balance sheet or on the fair market value of all assets, if higher.

For finance companies, the maximum indebtedness is 6/7 of the assets.

Interest rates may not exceed arm’s-length rates (the Swiss Fed­eral Tax Administration publishes safe haven rates periodically).

In certain cantons, specific debt-to-equity rules apply to real estate companies.

Foreign-exchange controls. Switzerland does not impose foreign-exchange controls.

Transfer pricing. Switzerland does not have statutory transfer-pricing rules. Intercompany charges should be determined at arm’s length. The tax authorities accept the transfer-pricing meth­ods described by the OECD guidelines. In particular, cost-plus charges should be justified and documented with appropriate ranges of mark-ups for each individual case. For the provision of financial and management services, the cost-plus method is ac­cepted in exceptional cases only.

Special guidelines apply concerning minimum and maximum in­terest on loans granted to or from shareholders or related parties.

Companies may discuss transfer-pricing issues with the tax au­thorities and confirm the outcome in binding rulings. In complex cases, they may apply for APAs. Rulings are more common.

Reorganizations. The Swiss Merger Law of 3 October 2003 autho­rizes companies to carry out tax-neutral reorganizations (mergers, demergers and transformations) if certain conditions are met, including the following:

  • Liability to Swiss tax continues after the reorganization.
  • Assets and liabilities are transferred and acquired at their previ­ous value for income tax purposes.

Double tax treaties. Switzerland has entered into more than 90 treaties for the avoidance of double taxation. The treaties gener­ally follow the OECD model treaty.

In 1962, the federal council issued an anti-abuse decree (BRB 62) under which the Swiss tax authorities unilaterally restricted the use of the Swiss tax treaty network by Swiss companies that are controlled by foreign residents. The BRB 62 regulations were sub­stantially loosened by a circular letter in 1999 and amendments in 2001. This circular letter substantially relaxed the restrictions for the following companies:

  • Companies that are engaged in an active business
  • Holding companies
  • Companies of which at least 50% of their shares (by voting rights and nominal value) is quoted and regularly traded on a Swiss stock exchange or on a foreign stock exchange with identical or comparable regulations and standards
  • Companies of which at least 50% of their shares (by voting rights and nominal value) is held directly by a Swiss company or several Swiss companies and the Swiss company or all of the Swiss companies are quoted and regularly traded on a Swiss stock exchange or on a foreign stock exchange with identical or comparable regulations and standards

If a company that remains subject to the anti-abuse decree re – ceives dividends, interest or royalties from sources in a country having a double tax treaty with Switzerland and if foreign with­holding tax is reduced as a result of the applicable tax treaty, no more than 50% of this income may be diverted to persons outside Switzerland.

The Federal Tax Administration published another circular letter on 1 August 2010 with respect to BRB 62 and the changes made in 1999 and 2001. This circular letter further relaxed the anti-abuse decree. It provides that, as of 1 August 2010, the anti-abuse regulations set forth in the new double tax treaties (including the ex tended administrative assistance clause in accordance with Article 26 of the OECD Model Convention) supersede the regula­tions set forth in BRB 62 and the amendments of 1999 and 2001. For all treaties without anti-abuse clauses, BRB 62 remains appli­cable. The 2010 circular letter also states that the following Swiss companies (in addition to the ones already specified in 1999 and 2001) are considered engaged in active business and therefore are no longer subject to the restrictions imposed in 1962:

  • Finance companies if their activities are conducted by highly qualified employees and a real value-added is generated. The actual activities carried out and the risks assumed are relevant rather than the number of employees.
  • Intellectual property (IP) companies. The same factors as men­tioned above for finance companies are taken into account.
  • Holding companies with a participation of at least 10% in the affiliate.

For further relief, the personnel of another Swiss group company may be considered when determining whether a company is active.

Switzerland-European Union agreement. The Switzerland-EU agreement on savings taxation took effect on 1 July 2005. In gen­eral, it provides for Switzerland measures equal to those contain­ed in the European Community (EC) Parent-Subsidiary Directive of 1990. Under these measures, dividends paid (similar rules also apply to intercompany interest and royalties) are not subject to tax in the country of source if the following conditions are satisfied:

  • The parent company has a direct minimum holding of 25% of the capital of the payer of the dividends (subsidiary) for at least two years.
  • Both the parent company and the subsidiary are subject to cor­porate tax without being exempted and both are in the form of a limited company.
  • One company is tax resident in an EU member state and the other company is tax resident in Switzerland.
  • Neither company is tax resident in a third state under a double tax treaty with that state.

Existing double tax treaties between Switzerland and EU mem­ber states that provide for more favorable tax treatment remain applicable.

The Switzerland-EU agreement applies to all EU member states, including the following jurisdictions:

  • Guadeloupe, Guyana, Martinique and Reunion (France)
  • Gibraltar (United Kingdom)
  • Azores and Madeira (Portugal)
  • Canary Islands (Spain)

The Switzerland-EU agreement will be extended to other territo­ries that join the EU in the future.

Relief from withholding tax under the Switzerland-EU agreement requires filing and approval of Form 823C by the Swiss Federal Tax Administration. The Swiss Federal Tax Administration uses beneficial ownership or substance as a criterion for its examina­tion of Form 823C. An approval remains valid for a three-year period. Reimbursements of Swiss withholding tax on dividends paid before the completion of the two-year minimum holding period requires filing and approval of Form 70 after the comple­tion of the two-year holding period.

The Switzerland-EU agreement also applies to all interest pay­ments made by a paying agent in Switzerland to an individual resident for tax purposes in an EU member state. Switzerland ap plies a withholding tax at a rate of 35%. The Switzerland-EU agreement allows foreign bank customers to choose between the withholding tax and a declaration to the tax authorities (voluntary declaration).

Corporate Tax Reform III. In the context of international develop­ments, the Swiss Federal Council published its draft legislation and a dispatch (associated commentary) on the Corporate Tax Reform III for parliamentary discussion.

In the framework of the Corporate Tax Reform III, the domicili­ary, mixed and holding company statuses at the cantonal/com-munal level will be abolished and replaced by new competitive and internationally accepted measures. In addition, the guidelines providing special rules for the international profit allocation of principal companies at the federal level, and the tax rules appli­cable to Swiss finance branches will be abolished or modified.

The Corporate Tax Reform III may include the following key measures:

  • A patent box at the cantonal level
  • Tax incentives for research and development at the cantonal level
  • Comprehensive rules for the disclosure of built-in gains (in­cluding goodwill) on migration to Switzerland or on change of the tax status

In addition, the following measures are currently under discus­sion:

  • Abolishment of the stamp duty on capital contributions at the federal level
  • Introduction of a notional interest deduction at the cantonal and federal levels

It is generally expected that the cantons will reduce their statutory income tax rates on the abolishment of the preferential cantonal tax regimes to enhance their attractiveness. The responsibility for such tax rate reductions lies with the cantons, and accordingly, these reductions are not formally included in the Corporate Tax Reform III package. Several cantons have already announced that they intend to reduce income tax rates significantly. In accordance with the draft legislation, the cantons will also be able to intro­duce targeted capital tax reductions on net equity related to par­ticipations and intangible assets.

The Swiss parliament is currently reviewing and discussing the draft legislation. It is expected that the new federal law is likely to enter into force as of 1 January 2018, at the earliest. After the new law is effective at the federal level, the cantons will have a transitional period of two years for implementing the new mea­sures of the federal law into the cantonal law.

Treaty withholding tax rates

Effective from 1 July 2005, Switzerland benefits from measures equivalent to those found in the EC Parent-Subsidiary Directive and the EC Directive on a common system of taxation applicable to interest and royalty payments made between associated com­panies of different Member States. Subject to fulfillment of the respective requirements, the taxpayer may apply either the Switzerland-EU agreement or an applicable double tax treaty.

Residence of recipient Dividends Interest (a) Royalties (b)
% % %
Albania (qq) 5 (d) 5 0
Algeria 5 (o) 10 0
Argentina 10/15 (ggg) 0/12 (qqq) 0
Armenia 5 (mm) 0/10 (rrr) 0
Australia 0/5/15 (cccc) 0/10 (ffff) 0
Austria 0 (t)(gg) 0 (gg) 0
Azerbaijan 5 (jj) 0/5/10 (kk) 0
Bangladesh 10 (t) 0/10 (uu) 0
Belarus 5 (d) 0/5/8 (gggg) 0
Belgium (qq) 10 (d)(gg) 0/10 (gg)(ll) 0
Bulgaria 0/10 (x)(gg) 0/5 (gg)(ttt) 0
Canada 0/5 (f)(xx) 0/10 (yy) 0
Chile 15 5/15 (vv) 0
China (w) 0/5/10 (bbbb) 0/10 (dddd) 0
Colombia 0 (t) 0/10 (hhhh) 0
Côte d’Ivoire 15 15 0
Croatia 5 (d)(gg) 5 (gg) 0
Cyprus 0/15 (gg)(sss) 0 (gg) 0
Czech Republic 0/15 (gg)(vvv) 0 (gg) 0
Denmark (rr) 0 (h)(gg) 0 (gg) 0
Ecuador 15 0/10 (ll) 0
Egypt 5 (d) 0/15 (m) 0
Estonia 0/10 (dd)(gg) 0 (gg) 0
Faroe Islands (rr) 0 0 0
Finland 0 (gg)(oo) 0 (gg) 0
France 0 (e)(gg) 0 (gg) 0
Georgia 0 (oo) 0 0
Germany 0 (j)(gg) 0 (gg) 0
Ghana 5 (g) 0/10 (ll) 0
Greece 5 (d)(gg)(zz) 7 (gg) 0
Hong Kong SAR 0/10 (ppp) 0 0
Hungary 0/15 (gg)(www) 0 (gg) 0
Iceland 0/15 (nn) 0 0
India (ss) 10 0/10 (cc) 0
Indonesia 10 (d) 10 0
Iran 5 (i) 0/10 (r) 0
Ireland 0/15 (gg)(www) 0 (gg) 0
Israel 5 (g) 5/10 (k) 0
Italy (qq) 15 (gg) 12.5 (gg) 0
Jamaica 10 (s) 0/10 (iiii) 0
Japan 0/5/10 (ww) 0/10 (ff) 0
Kazakhstan 5 (bb)(yyy) 10 0
Korea (South) 5/15 (g) 0/5/10 (k)(iii) 0
Kuwait 15 10 0
Kyrgyzstan 5 (d) 5 0
Latvia 5 (o)(gg) 0/10 (gg)(iiii) 0
Liechtenstein (eeee) — (eeee) — (eeee) 0
Lithuania 5 (o)(gg) 0/10 (gg)(iiii) 0
Luxembourg 0 (q)(gg) 0/10 (gg) 0
Macedonia 5 (d) 0/10 (cc) 0
Malaysia 5 (d) 10 0
Malta 0/15 (gg)(mmm) 0/10 (gg)(lll) 0
Mexico 0 (bb) 5/10 (p) 0
Moldova 5 (d) 0/10 (ll) 0
Mongolia 5 (d) 0/10 (ll) 0
Montenegro 5 (t) 10 0
Morocco 7 (d) 10 0
Netherlands 0 (h)(gg) 0 (gg) 0
New Zealand 15 10 0
Norway 0 (y) 0 0
Pakistan 10 (ee) 10 0
Peru 10/15 (zzz) 10/15 (aaaa) 0
Philippines 10 (y) 10 0
Poland 0/15 (gg)(tt) 0/5/10 (c)(gg) 0
Portugal 5 (d)(gg) 10 (gg)(dddd) 0
Qatar 5 (pp) 0 0
Romania 0/15 (gg)(ii) 0/5 (gg)(nnn) 0
Russian Federation 0/5/15 (hhh)(ooo) 0 0
Serbia 5 (t) 10 0
Singapore 0/5/15 (aaa) 0/5 (bbb) 0
Slovak Republic 0/15 (gg)(eee) 0/5 (gg)(jjj) 0
Slovenia 0/15 (gg)(uuu) 0/5 (gg)(xxx) 0
South Africa 5 (o) 5 0
Spain 0 (gg)(hh) 0 (gg) 0
Sri Lanka 10 (d) 10 (k) 0
Sweden 0/15 (gg)(ddd) 0 (gg) 0
Taiwan 10 (t) 0/10 (n) 0
Tajikistan 5 (o) 0/10 (n) 0
Thailand 10 (y) 0/10/15 (u) 0
Trinidad and Tobago 10 (l) 10 0
Tunisia 10 10 0
Turkey 5/15 (o) 0/5/10/15 (fff) 0
Turkmenistan 5/15 (d) 10 0
Ukraine 5 (o) 0/10 (n) 0
United Arab Emirates 0/5/15 (g)(kkk) 0 0
United Kingdom 0 (h)(gg) 0 (gg) 0
United States (ccc) 5 (g) 0 0
Uruguay 5 (d) 0/10 (ll) 0
Uzbekistan 5 (o) 0/5 (r) 0
Venezuela 0 (z) 0/5 (aa) 0
Vietnam 7 (v) 0/10 (jjjj) 0
Non-treaty countries 35 0/35 0

 

a) Withholding tax is imposed only on bank interest and on interest from pub­licly offered bonds, debentures and other instruments of indebtedness issued by a Swiss borrower, but not on interest on commercial loans, including loans from foreign parents to Swiss subsidiaries.

b) Under Swiss domestic law, no withholding tax is imposed on royalties, manage­ment fees, rents, licenses and technical assistance fees and similar payments.

c) A 5% general rate and a 0% rate on interest paid between related parties (as defined in the double tax treaty) apply to interest paid on or after 1 July 2013. A 10% rate applies to interest paid on or before 30 June 2013.

d) This rate applies if the shareholding by a corporation is at least 25%. A 15% rate applies to all other dividends.

e) The 0% rate generally applies if the shareholding of a corporate recipient of dividends is at least 10%. The rate is increased to 15% if the shareholding of a corporate recipient is less than 10% or if the corporate recipient is con­trolled by persons that are not in the contracting states unless the corporate recipient demonstrates that the participation rights are not solely intended to profit from the advantages mentioned above. The 15% rate also applies to dividends paid to individuals and all other dividends.

f) The 5% rate applies to dividends paid to corporations with a shareholding and voting stock of at least 10% in the payer. A 15% rate applies to other dividends.

g) The 5% rate applies to dividends paid to corporations with a shareholding of at least 10% in the payer. A 15% rate applies to other dividends.

h) This rate applies to dividends paid to corporations holding at least 10% of the capital and to dividends paid to pension funds or other similar institutions providing pension schemes. A 15% rate applies to other dividends.

i) The 5% rate applies if the recipient of the dividends is a corporation with a shareholding of at least 15%. A 15% rate applies to other dividends.

j) The 0% rate generally applies if the recipient of the dividends is a corpora­tion that has a shareholding of at least 10% and if the participation has been held for at least one year. A 15% rate applies if the recipient of the dividends is a corporation that has a shareholding of less than 10% or if the recipient of the dividends is an individual.

k) A rate of 5% applies to interest on bank loans.

l) Rate is applicable if shareholding by a corporation is at least 10%. The net treaty withholding rate is increased to 20% if shareholding is less than 10%.

m) A 0% rate applies to interest on bank loans.

n) The 0% rate applies to the following interest payments:

  • Interest paid to the other contracting state in connection with the sale on credit of industrial, commercial or scientific equipment
  • Interest paid in connection with the sale on credit of merchandise by one enterprise to another enterprise
  • Interest on a loan granted by a bank or to the other contracting state or a political subdivision or a local authority thereof

o) The 5% rate applies if the recipient of the dividends is a corporation with a shareholding of at least 20%. The rate is increased to 15% in all other cases.

p) For interest paid to banks, the withholding tax rate is reduced to 5%.

q) The 0% rate applies to dividends paid to corporations with direct ownership of at least 10% and a holding period of two years and to dividends paid to pension funds or other similar institutions. A 5% rate applies to corporations with direct ownership of at least 10% before the two-year holding period has elapsed. A 15% rate applies in all other cases.

r) The 0% rate applies to the following interest payments:

  • Interest paid with respect to a loan made, guaranteed or insured by the government of the other state or an instrumentality or agency thereof
  • Interest paid in connection with the sale on credit of industrial, commer­cial or scientific equipment
  • Interest paid in connection with the sale on credit of merchandise by one enterprise to another enterprise
  • Interest on a loan granted by a bank

s) This rate applies to dividends paid to corporations holding at least 10% of the voting power of the payer. A 15% rate applies to other dividends.

t) This rate applies if the shareholding of the recipient is at least 20%. For other dividends, the rate is 15%.

u) The 0% rate applies to interest on special trade credits or loans. The 10% rate applies to interest paid to banks or insurance companies. The 15% rate applies to other interest.

v) This rate applies if the shareholding of the recipient is at least 50%. The rate is 10% if the shareholding of the recipient is at least 25% but less than 50%. The rate is 15% for other dividends.

w) The China treaty does not cover the Hong Kong SAR.

x) The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company (other than a partnership) directly owning shares representing at least 10% of the capital of the company paying the dividends for at least one year before the payment of the dividends
  • A pension fund or scheme
  • The central bank

y) This rate applies if the direct shareholding of the corporate recipient is at least 10%. For other dividends, the rate is 15%.

z) The rate is 10% if the shareholding of the recipient is less than 25%.

(aa) The 0% rate applies to interest on certain government bonds. The 5% rate applies to other interest.

(bb) This rate applies if the shareholding of the recipient is at least 10%. A 15% rate applies to all other dividends.

(cc) A 0% rate applies to interest on bank loans and in certain other special cases. (dd) The 0% rate applies if the beneficial owner of the dividends is one of the following:

  • A company (other than a partnership) that is a resident of the other con­tracting state and that holds directly at least 10% of the capital in the company paying the dividends for at least one year before the payment of the dividend
  • A pensions scheme
  • The central bank of the other contracting state

(ee) The 10% rate applies to dividends paid to corporations holding participations

of at least 20% in other enterprises. A 20% rate applies to other dividends.

(ff)    The 0% rate applies to the following interest payments:

  • Interest paid to a contracting state or a political subdivision or local authority thereof
  • Interest paid to the central bank of the other contracting state or any institution owned by the government
  • Interest paid to a bank, insurance company, securities dealer or pension fund or scheme

(gg) A 0% rate may apply under the Switzerland-EU agreement (see the para­graph preceding the treaty withholding tax rate table). The rates shown in the table are the treaty withholding tax rates.

(hh) The 0% rate applies if the recipient is a company that owns directly at least 10% for a period of at least one year of the capital of the company paying the dividends or if the recipient is a pension fund or pension scheme. The 15% rate applies to other dividends.

(ii)    The 0% rate applies if the recipient is a company (other than a partnership) that owns directly at least 25% of the capital of the company paying the dividends, a governmental institution, a pension fund or a central bank au­thority. A 15% rate applies to other dividends.

(jj)    The 5% rate applies if the corporate recipient of the dividends holds a shareholding of at least 20% in the distributing entity and has invested at least USD200,000 in the country of the distributing entity. The treaty with­holding tax rate is increased to 15% if the shareholding is less than 20%.

(kk) The 0% rate applies to interest paid to certain government agencies or in connection with the purchase of industrial, commercial or scientific equip­ment on credit. The 5% rate applies to interest paid to banks or in connection with the purchase of goods on credit. The 10% rate applies to other interest.

(ll)    The 0% rate applies to the following interest payments:

  • Interest paid in connection with the sale on credit of industrial, commer­cial or scientific equipment
  • Interest paid on the sale of goods between corporate entities
  • Interest paid on certain bank loans

A 10% rate applies to all other interest payments.

(mm) The 5% rate applies if, at the time the dividends become due, the corporate recipient of the dividends holds a shareholding of at least 25% in the dis­tributing entity and the value of the participation is at least CHF200,000 (or the equivalent in foreign currency). The treaty withholding tax rate is 15% if these conditions are not met.

(nn) The 0% rate applies if the beneficial owner of the dividends is one of the following:

  • A company (other than a partnership) that is a resident of the other con­tracting state and that holds directly at least 10% of the capital in the company paying the dividends for at least one year before the payment of the dividend
  • A pensions scheme
  • The central bank of the other contracting state

(oo) The 0% rate generally applies if the shareholding of a corporate recipient of dividends is at least 10%. The rate is increased to 10% if the shareholding of a corporate recipient is less than 10%.

(pp) A 0% rate applies to dividends paid to the other contracting state or a politi­cal subdivision or local authority thereof, the central bank or pension funds. The 5% rate applies to dividends paid to corporate recipients if the share­holding is at least 10%. A 10% rate applies if the recipient is an individual with a shareholding of at least 10%. For other dividends, the rate is 15%.

(qq) These treaties have been renegotiated and signed, or amending protocols to these treaties have been signed. The renegotiated treaties or amending pro­tocols will enter into force on 1 January of the year following the year of the notifications of each contracting state. It appears that these treaties or protocols will not enter into force before 1 January 2017.

(rr) The treaty between Denmark and Switzerland was extended to the Faroe Islands as of 22 September 2009. The extension and the revised protocol between Denmark and Switzerland entered into force in November 2010.

(ss) On 10 October 2011, an amending protocol entered into force. The proto­col did not change the withholding tax rates. However, if after the date of signing of the amending protocol, India and a third state that is an OECD member sign a convention, agreement or protocol and if under this conven­tion, agreement or protocol, India limits its taxation at source of dividends, interest, royalties or fees for technical services to a rate lower than the rate provided for in the double tax treaty between Switzerland and India, the lower rate will also apply under the double tax treaty between Switzerland and India, effective from the date on which such convention, agreement or protocol enters into force.

(tt)            The 0% rate applies if the dividends are paid to corporations with a share‑
holding of at least 10% in the capital of the payer and the shareholding is held for at least two years or if the dividends are paid to pension funds or similar institutions. A 15% rate applies in all other cases.

(uu) The 0% rate applies to interest paid to the other contracting state or certain government agencies of the contracting state or in connection with financing transactions, the purchase of industrial, commercial or scientific equipment or the construction of industrial, commercial, scientific or public facilities on credit. The 10% rate applies to all other interest.

(vv) The 5% rate applies to interest paid on bank and insurance loans, on bonds and other securities that are traded on a stock exchange and in certain other special transactions. The 15% rate applies to all other interest payments.

(ww) The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company that has owned directly or indirectly for at least six months shares representing at least 50% of the capital or voting power of the company paying the dividends
  • A pension fund or scheme

The 5% rate applies to corporate recipients if the direct or indirect share­holding represents at least 10% of the capital or voting power and if the participation has been held for six months. A 10% rate applies to all other dividends.

(xx) The 0% rate applies to dividends that are paid to the Bank of Canada or qualifying pension schemes.

(yy) The 0% rate applies to interest payments if the beneficial owner of the interest is a resident of Canada and is not related to the payer.

(zz) The 0% rate applies if the beneficial owner of the dividends is the other contracting state, a political subdivision or a local authority of the other contracting state or a pension fund or scheme.

(aaa) The 0% rate applies to dividends paid to the Monetary Authority of Singa­pore or the Government of Singapore Investment Corporation Pte Ltd. The 5% rate applies to dividends paid to a corporation (other than a partnership) holding directly at least 10% of the capital of the company paying the dividends. The 15% rate applies to other dividends.

(bbb) The 0% rate applies to interest paid by a banking enterprise to a banking enterprise in the other contracting state or interest arising in Switzerland and paid to the Monetary Authority of Singapore. The 5% rate applies to other interest.

(ccc) This treaty has been renegotiated and signed. The revised treaty will enter into force after each country has completed the domestic law procedures for ratification and complied with the respective provisions of the treaty.

(ddd) The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company (other than a partnership) that has owned directly or indi­rectly shares representing at least 10% of the capital or voting power of the company paying the dividends
  • A pension fund

The 15% rate applies to other dividends.

(eee) The 0% rate applies to dividends paid to a corporation with a direct share­holding of at least 10% in the capital of the payer and to dividends paid to a governmental institution, pension fund or central banking authority. A 15% rate applies to other dividends.

(fff) The 0% rate applies to interest paid to the state or the central bank. The 5% rate applies to interest paid with respect to a loan or credit made, guaran­teed or insured for the purposes of promoting export by an Eximbank or similar institution. The 10% rate applies to interest derived by a bank. A 15% rate applies in all other cases.

(ggg) The 10% rate applies to dividends if the beneficial owner is a company (other than a partnership) that holds directly at least 25% of the capital of the company paying the dividends. The 15% rate applies to other dividends.

(hhh) The 5% rate applies if the recipient of the dividends holds a shareholding of at least 20% in the distributing entity and if the value of the participation is at least CHF200,000 (or the equivalent in foreign currency). A 15% rate applies to other dividends (in specific cases the 0% rate applies; see foot­note [ooo]).

(iii) The 0% rate applies to the following interest payments:

  • Interest paid with respect to a loan made, guaranteed or insured by the government of the other state or an instrumentality or agency thereof
  • Interest paid in connection with the sale on credit of industrial, com­mercial or scientific equipment
  • Interest paid in connection with the sale on credit of merchandise by one enterprise to another enterprise
  • Interest paid to the other contracting state

(jjj)      The 0% rate applies to the following interest payments:

  • Interest paid in connection with the sale on credit of industrial, com­mercial or scientific equipment
  • Interest paid on bank loans
  • Interest paid to a bank, insurance company or pension fund or scheme
  • Interest paid to a contracting state, a political subdivision or local authority thereof, or a central bank
  • Interest paid between enterprises that are associated by a stake of at least 25% held for at least two years or that are both held by a third company that directly holds at least 25% of the capital of both compa­nies for at least two years

(kkk)    A 0% rate applies to dividends paid to the other contracting state or a political subdivision or local authority thereof, the central bank or a pen­sion fund.

(lll)      The 0% rate applies to the following interest payments:

  • Interest paid in connection with the sale on credit of industrial, com­mercial or scientific equipment
  • Interest paid on the sale of goods between corporate entities
  • Interest paid on bank loans

In addition, the 0% rate applies if the interest is paid between enterprises

that satisfy all of the following conditions:

  • They are associated by a stake of at least 10% held for at least one year or they are both held by a third company that directly holds at least 10% of the capital of both companies.
  • They are resident in a contracting state and, under any double tax agreement with any third state, none of the companies is resident in that third state.
  • They are subject to corporation tax and are not exempt from tax on interest payments.
  • They are both limited companies.

The 10% rate applies to other interest payments.

(mmm) The 0% rate applies if the direct shareholding of the corporate recipient is at least 10% and if the participation has been held for at least one year.

For other dividends, the rate is 15%.

(nnn)    The 0% rate applies to the following interest payments:

  • Interest paid to a contracting state or a political subdivision, local authority, administrative-territorial unit or export financing institution thereof
  • Interest paid between enterprises that are associated by a stake of at least 25% or that are both held by a third company that directly holds at least 25% of the capital of both companies

(ooo)    The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is one of the following:

  • A pension fund or scheme
  • The government of the other state, or a political subdivision or local authority thereof
  • The central bank

(ppp)    The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company (other than a partnership) directly owning shares represent­ing at least 10% of the capital of the company paying the dividends
  • A pension fund or scheme
  • The central bank

The 10% rate applies to other dividends.

(qqq) The 0% rate applies to interest on government bonds and in certain other

special cases.

(rrr)      The 0% rate applies to the following interest payments:

  • Interest paid in connection with the sale on credit of industrial, com­mercial or scientific equipment
  • Interest on a loan granted by a bank

(sss)     The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is one of the following:

  • A company (other than a partnership) that has its capital wholly or partly divided into shares and that holds directly at least 10% of the capital of the company paying the dividends during an uninterrupted period of at least one year
  • A pension fund or other similar institution providing pension schemes

in which individuals may participate to secure retirement, disability and survivors’ benefits, if such pension fund or other similar institution is established, recognized for tax purposes and controlled in accor­dance with the laws of the other contacting state

  • The government of the other contracting state, a political subdivision or local authority thereof, or the central bank of the other contracting state

(ttt)      The 0% rate applies to the following interest payments:

  • Interest paid in connection with the sale on credit of equipment, mer­chandise or services
  • Interest paid on bank loans
  • Interest paid with respect to pension schemes
  • Interest paid to the government of the other state, a political subdivi­sion or local authority thereof, or the central bank
  • Interest paid between companies that are associated by a direct stake of at least 10% held for at least one year or by a direct holding of a third company of at least 10% for at least one year of the capital of both companies

The 5% rate applies to other interest payments.

(uuu)    The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company (other than a partnership) that directly owns shares repre­senting at least 25% of the capital of the company paying the dividends
  • A pension fund or scheme

(vvv)    The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company (other than a partnership) that directly owns shares repre­senting at least 10% of the capital of the company paying the dividends for an uninterrupted period of at least one year
  • A pension fund or central bank

(www) The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is either of the following:

  • A company (other than a partnership) that directly owns shares repre­senting at least 10% of the capital of the company paying the dividends
  • A pension scheme
  • The central bank

The 15% rate applies to other dividends.

(xxx)    The 0% rate applies to the following interest payments:

  • Interest paid to the government of the other state, a political subdivi­sion or local authority thereof, or the central bank
  • Interest paid on specific bank loans of international business transac­tions
  • Interest paid in connection with the sale on credit of equipment, mer­chandise or services
  • Interest paid between companies that are associated by a direct stake of at least 25% or by a direct holding of a third company (resident in the EU or Switzerland) of at least 25% of the capital of both companies The 5% rate applies to other interest payments.

(yyy)    A 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is one of the following:

  • A pension fund or scheme
  • The central bank

(zzz)     The 10% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is a company (other than a partnership) that holds directly at least 10% of the capital and of the voting power of the company paying the dividends. The 15% rate applies to other divi­dends.

(aaaa) The 10% rate applies to the following interest payments:

  • Interest paid in connection with the sale on credit of industrial, com­mercial or scientific equipment
  • Interest paid on bank loans

The 15% rate applies to other interest payments.

(bbbb) The 0% rate applies to dividends if the beneficial owner is a resident of the other contracting state and is one of the following:

  • The government of the other state, or a political subdivision or local authority thereof
  • An institution or fund wholly owned by that other state as agreed by mutual agreement of the competent authorities of the contracting states
  • The central bank

The 5% rate applies if the recipient is a company (other than a partner­ship) that owns directly at least 25% of the capital of the company paying the dividends. The 10% rate applies to other dividends.

(cccc) The 0% rate applies to dividends if, in the case of Australia, the beneficial owner of the dividend is a company that owns directly no more than 10% of the voting power of the company paying the dividends or, in the case of Switzerland, owns directly no more than 10% of the capital of the company paying the dividends and if the beneficial owner is one of the following:

  • A contracting state, a political subdivision or local authority thereof
  • The national bank
  • In the case of Australia, a resident of Australia deriving such dividends from the carrying on of complying superannuation activities
  • In the case of Switzerland, a pension scheme whose investment income is exempt from Swiss tax

The 5% rate applies to dividends paid to corporations holding at least directly 10% of the voting power of the payor in the case of Australia or 10% of the capital of the payor in the case of Switzerland. A 15% rate applies to other dividends.

(dddd) The 10% rate applies to interest payments. However, exemptions apply to, among others, the following:

  • The government of the other contracting state, and several governmental bodies and institutions thereof
  • The national bank

(eeee) On 10 July 2015, Switzerland and Liechtenstein signed a tax treaty for the avoidance of double taxation with respect to income and capital. It appears that this treaty will not enter into force before 1 January 2017. The follow­ing rates will apply under the new treaty:

  • A 0% rate will apply to dividends if the beneficial owner of the divi­dends is a corporation that directly holds at least 10% of the capital in the company paying the dividend for at least one year before the pay­ment of the dividends or if the beneficial owner of the dividends is a pension scheme, contracting state, political subdivision or local author­ity thereof. A 15% rate will apply to other dividends.
  • A 0% rate will apply to interest.

(ffff) The 0% rate applies to interest if the beneficial owner is a resident of the

other contracting state and is in one of the following categories:

  • Bodies exercising governmental functions and banks performing central bank functions
  • Financial institutions that are unrelated to and dealing independently with the payer
  • Complying Australian superannuation funds and tax-exempt Swiss pension schemes

A 10% rate applies to other interest payments.

(gggg) The 0% rate applies to the following interest payments:

  • Interest on loans approved by the government
  • Interest income derived from sales on credit of industrial, medical or scientific equipment
  • Interest on bonds issued by a contracting state, political subdivision or local authority thereof

The 5% rate applies to interest on bank loans. The 8% rate applies to other interest payments.

(hhhh) The 0% rate applies if any of the following circumstances exist:

  • The beneficial owner is the contracting state or a political subdivision or local authority thereof.
  • The interest is paid in connection with the sale on credit of goods, mer­chandise or any equipment.
  • The interest is paid on bank loans.

A rate of 10% applies to other interest payments.

(iiii)    The 0% rate applies to interest in connection with bonds, debentures or other similar obligations of the government or of a political subdivision or local authority thereof and in certain other special cases. The 10% rate applies to other interest payments.

(jjjj)    The 0% rate applies to interest on certain loans guaranteed, insured or financed by the contracting state. The 10% rate applies to other interest.

At the time of writing, Switzerland had signed new double tax treaties or protocols to existing double tax treaties that contain potential changes in treaty withholding tax rates with Albania, Belgium, Italy, Liechtenstein and Oman.