Switzerland And Norway Sign Revised DTA

by Ulrika Lomas, Tax-News.com, Brussels

04 September 2009

Switzerland and Norway have signed an agreement revising the existing double taxation agreement between the two countries, it emerged recently.

The revised agreement provides for administrative assistance in tax matters under Article 26 of the OECD Model Convention, and was negotiated in line with parameters laid out by the Federal Council.

Following the Federal Council decision on 13 March 2009, Norway is the fourth country with which Switzerland has signed a DTA containing the extended administrative assistance clause in accordance with Art. 26 of the OECD Model Convention, after Denmark, Luxembourg and France.

Up to now, Switzerland has negotiated DTAs with an extended administrative assistance clause with fourteen countries. Along with the agreements already signed with Denmark, Luxembourg, France and Norway, there are agreements with Mexico, the USA, Japan, the Netherlands, Poland, the UK, Austria, Finland, Qatar and Singapore.

These DTAs have been initialled but not yet signed. The Federal Council has given the go-ahead for DTAs to be signed with Mexico, the United Kingdom and Austria. The other initialled DTAs will be submitted to the Federal Council shortly for approval to be signed.

In addition to extending administrative assistance in tax matters, several other amendments were made to the existing DTA between Switzerland and Norway during the recent negotiations.

In future, only the country of residence will be able to levy a tax on dividends, provided that the holding in the capital is a minimum 10%.

Until now a ‘zero rate’ applied, and the source state was only able to levy taxes on investments of 20% and above. The right of the source state to tax pensions, restricted to 15%, was also introduced.

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