Tax-exempt legal entities for profit and supplementary taxes in Switzerland - A legal comparison
Not only the federal, cantonal and communal taxes on profits (DBG, StHG), but also the supplementary taxes (GloBE model regulations, MindStV) recognize the concept of subjective tax exemption for legal entities. The regulations are basically congruent, but there are several case constellations of practical relevance in which the supplementary taxes override the profit tax exemption (e.g. cantonal banks, health insurance companies, newly established companies). The author therefore sees a need for action on the part of legislators and tax authorities.
Taxation of spouses in international relationships - Federal Supreme Court ruling of September 23, 2024 Prejudice on tax separation issues
In its ruling of September 23, 2024, the Federal Supreme Court issued a long-awaited precedent on the issue of international tax differentiation of debts and debt interest in the case of international spouses and revised its ruling of March 2023 on the international transfer of maintenance payments to the divorced spouse. What does this precedent mean for practice and how should other exciting practical cases be handled?
Implementation of global minimum taxation - safe harbor transitional rules for investment entities
On January 1, 2024, Switzerland partially introduced the OECD minimum tax by means of the Minimum Tax Ordinance (MindStV). The implementation of the global legal requirements poses considerable challenges for companies due to the complexity of the regulations and the technical implementation in the accounting systems. For this reason, many companies fall back on safe harbor regulations provided by the OECD. In this context, the following article examines whether these also apply to investment entities that are part of the corporate group.
The new double taxation agreement between Italy and Liechtenstein - advantages and specific cases of application
On July 12, 2023, Liechtenstein and Italy signed a double taxation agreement (DTA). The agreement is based on the international standard of the OECD Model Tax Convention 2017, takes into account the results of the BEPS project and follows the agreement on the exchange of information (TIEA) that was concluded with Italy in 2015. The DTA increases legal certainty, leads to significant withholding tax reductions, reduces existing barriers to investment and financing and will make a decisive contribution to further strengthening cooperation between the two countries.
Double Taxation Convention
The Commission also follows the decision of the National Council from the last winter session and requests approval of the double taxation agreement with Brazil (18,064; 10 votes to 1 with 1 abstention) and the United Kingdom (18,062; unanimously).
Withholding tax according to DBA
The Bilateral Tax Issues and Double Taxation Division of the State Secretariat for International Financial Matters (SIF) has updated the overviews of the contractual limits on foreign taxes, the tax relief for Swiss dividends and interest, and the countries whose agreements contain abuse provisions.
The Tax Information Agreement with Brazil has entered into force
The Tax Information Agreement between Switzerland and Brazil entered into force on 4 January 2019. The provisions of the Agreement shall be applied from 1 January 2020.
Federal Council repeals the transitional provision in the Ordinance on the International Automatic Exchange of Information in Tax Matters
At its meeting on 7 November 2018, the Federal Council decided to repeal the transitional provision on the term "participating states" in the Ordinance on the International Automatic Exchange of Information in Tax Matters as of 1 January 2019. This will implement an international requirement.
Commission suspends consultation on double taxation agreement with Saudi Arabia
Following the murder of the journalist Khashoggi, the Commission has decided to suspend discussion of this agreement until the Federal Council has thoroughly reviewed Switzerland's relations with Saudi Arabia.
First exchange of information on around 2 million financial accounts
The Federal Tax Administration (FTA) has exchanged information on financial accounts for the first time. The exchange takes place within the framework of the global standard for automatic information exchange (AIA).
Federal Council adopts dispatch on double taxation agreement with Brazil
On 5 September 2018 the Federal Council adopted the dispatch on the double taxation agreement (DTA) in the area of income taxes with Brazil. This is the first DTA between Switzerland and Brazil. The agreement was signed in Brasilia on 3 May 2018 and will come into force following approval by the parliaments of both countries.
No extension of mutual assistance for fiscal offences
Following its decision not to revise the law on fiscal offences, the Federal Council has also decided not to extend mutual assistance in fiscal offences. In particular, it would put the Swiss tax authorities at a disadvantage compared to foreign tax authorities. The Federal Council took this decision at its meeting on 29 August 2018.
