A Protocol to the Double Taxation Convention between the UK and Switzerland was signed in London on 26 June 2007 and entered into force on 22 December 2008. The text has been published as the Schedule to The Double Taxation Relief and International Tax Enforcement (Taxes on Income) (Switzerland) Order 2007 (Statutory Instrument 2007 No 3465), copies of which can be obtained from The Stationery Office. The text of the Order can be accessed on the Office of Public Sector Information website.
The draft Order was approved by Parliament on 27 November 2007 and details of the debate can be found in the House of Commons Official Report, Third Delegated Legislation Committee of 26 November 2007. Copies of the Official Report are also available from the Stationery Office and may be accessed on the UK Parliament website.
The Protocol will make some amendments to the existing double taxation convention, dated 8 December 1977. The main amendments are the elimination of taxation at source on dividends where the beneficial owner of the dividends has a substantial participation in the payer or is a pension scheme. The Protocol also amends the exchange of information article. It provides that, in future, information will be exchanged in cases of tax fraud or the like, and in cases involving holding companies.
The Protocol also contains measures relating to pensions. In future, lump sum payments may be taxed only by the state in which they arise. Also, pension contributions paid to a scheme recognised for tax purposes in one country may, under certain conditions, be deductible in the other country.
The provisions will take effect from the dates set out in Article XIV of the Protocol.
HM Revenue & Customs
December 2008
