Switzerland-Austria Double Tax Treaty

Switzerland’s double tax treaty with Austria

Switzerland has concluded its first double taxation agreement with Austria in 1974. The treaty was enforced by both countries a year later and was amended several times in 2001, 2007, and 2011. The Switzerland-Austria double tax convention covers the following taxes:

• -          the income and inheritance and gift taxes in Austria,
• -          the income and inheritance tax in Switzerland.

Avoidance of double taxation with respect to inheritance taxes are treated separately in the agreement between Switzerland and Austria. For more information about the inheritance tax levied in Switzerland you can refer to our lawyers.

Taxation under the Switzerland-Austria double tax agreement

Under the tax convention between Switzerland and Austria, both natural persons and companies can benefit from the agreement. The double taxation treaty also contains provisions about permanent establishments of Austrian and Swiss companies in the other contracting state. According to the agreement, the following sites qualify as permanent establishments:

• -          branch offices;
• -          any place of management;
• -          factories;
• -          offices;
• -          workshops.

The following types of taxes related to incomes are covered by the Switzerland-Austria double taxation treaty:

• -          the corporate, income, supervisory and the wealth taxes in Austria;
• -          the federal, cantonal and municipal taxes applied to the total income, employment and capital gains in Switzerland.

Our Swiss lawyers can provide with more information about taxation under the agreement with Austria.

Amendments to the Switzerland-Austria double taxation treaty

The agreement for avoidance of double taxation Switzerland concluded with Austria was amended in 2011 when two new provisions were added:

• -          the first one is related to the exchange of information between the two countries;
• -          the second one is an arbitration clause.

Reduced tax rates under the agreement between Switzerland and Austria

The double tax treaty between Switzerland and Austria also contains the following reduced tax rates:

• -          a 0% tax rate with respect to dividend payments,
• -          a 0% tax rate with respect to interest payments,
• -          a 0% tax rate with respect to royalties.

Considering that these rates apply under certain circumstances, we invite you to contact our Swiss law firm for more information about the double taxation agreement with Austria.