On the 10 July 2015, Switzerland and Liechtenstein signed a new double taxation agreement (DTA) amending the previous agreement, signed in 1995. The new provisions of the agreement lower the withholding tax rates applicable to dividend and interest payments.
The DTA was signed by the head of Swiss Federal Department of Finance, Eveline Widmer-Schlumpf and the Prime Minister of Liechtenstein, Vaduz Adrian Hasler.
Under the provisions of the new agreement the following withholding taxes will apply:
Dividends:
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0% if the beneficial owner is a company (other than a partnership) and holds at least 10% of the capital of the company paying the dividends for at least 1 year
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0% if the beneficial owner is a pension funds
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0% if the beneficial owner is a Contracting State, a political subdivision, a local authority or its central bank;
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14% in all other cases
Interest:
Royalties:
Additionally, the DTA contains provisions for the exchange of information that are in line with the Organisation for Economic Cooperation and Development (OECD) standard.
The new treaty will enter into force on January 1, 2017.
Sources:
TreatyPro.com & Offtax.com
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