Corporate income tax rate (effective) for holding companies
(Federal, state, cantonal
For holding companies with special tax status: 7.83% on income, other than qualifying dividends and capital gains.
Possible "other income", i.e. interest and royalty income, up to 1/3 of the total income.
|CFC rules||No CFC rules|
|Treatment of domestic/foreign dividends||
Participation relief, if
> holding of at least 10% of the domestic / foreign corporation's equity or
> fair market value of the participation is at least CHF 1m
No subject to tax clause
|WHT on dividends||
Ordinary rate: 35% for dividends from a Swiss entity
Reduced to zero percent under the EU Saving Tax Agreement, if the EU parent company holds at least 25% of share capital in the Swiss company for at least 2 years and both companies are subject to CIT.
Reduced under double tax treaties if the respective conditions are fulfilled.
|Treatment of capital gains resulting from the disposal of domestic/foreign shares||Participation relief if holding of at least 10% of the domestic / foreign corporation's equity and if holding period of at least 1 year|
|WHT on interest payments||No WHT on interest deriving from regular loan agreements.|
|WHT on royalty payments||No WHT|
|Thin capitalization rules and debt-to-equity ratio||Thin cap rules published by the FTA in a circular letter (applicable for operating companies); 6:1 safe haven for finance companies|
|Deductibility of interest expenses / limitation of interest deduction||
Interest rates may not exceed arm's length rates (FTA publishes safe haven rates periodically).
|Advance ruling regime and timing||
Yes, advance rulings are given by the respective tax authority (FTA and / or cantonal tax authorities)
Timing of ruling approx. 4-8 weeks (depending on work load)
Switzerland has a broad treaty network with currently 84 tax treaties, e.g.:
- China (10% on dividends)