Swiss withholding tax

Swiss withholding tax (impôt anticipé) is a 35% federal tax levied at source on specified capital income paid by Swiss entities — dividends, bond interest, lottery winnings. It functions as a tax guarantee: Swiss resident individuals can claim full refund by correctly declaring the income; non-residents recover a portion under applicable double taxation treaties. Distributions from confirmed capital contribution reserves (RAP) are exempt from withholding tax — a major structural advantage in Swiss group financing. In financial structuring, minimising withholding tax leakage on dividend flows is a primary objective.

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Example: a Swiss SA distributes a CHF 2.0 million ordinary dividend. The 35% withholding tax (CHF 700,000) is deducted and paid to the SFTA. A Swiss individual shareholder recovers CHF 700,000 via their cantonal tax return. A French corporate shareholder recovers 5% of CHF 2.0 million (France-Switzerland treaty: reduced 5% rate for corporate parents holding 10%+), permanently bearing 30% withholding = CHF 600,000 — versus zero on a CHF 2.0 million RAP distribution.

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Hectelion optimises withholding tax on Swiss dividend distributions by maximising RAP usage and structuring intra-group flows to minimise leakage in every Swiss structuring mandate.