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  • UK-Swiss Confederation Taxation Cooperation Agreement

UK-Swiss Confederation Taxation Cooperation Agreement

The Agreement between the UK and the Swiss Confederation on co-operation in the area of taxation came into force on 1 January 2013.

Supporting UK legislation at Schedule 36 to the Finance Act 2012 also became effective from the same date

A guide to the agreement can be accessed via the following link:

Swiss/UK Tax Cooperation Agreement factsheet (PDF 78K)

Further guidance is available in the International Manual and Compliance Handbook.

Background

The Tax Agreement between the UK and Switzerland was signed on 6 October 2011 by the Exchequer Secretary David Gauke and the Swiss Finance Minister Eveline Widmer-Schlumpf.

On 20 March 2012 the UK and Switzerland signed a Protocol to the Tax Agreement. This:

  • Clarifies the relationship between the Agreement and the EU Savings Agreement (EUSA) with Switzerland. Where a relevant person has suffered withholding tax under the EUSA, an additional 13 per cent 'tax finality payment' will need to be paid to obtain tax clearance under the terms of the Agreement. This achieves the same effect as the 48 per cent withholding tax levied under the original terms of the Agreement.
  • Introduces a new Inheritance Tax levy on the death of the relevant person unless their personal representatives authorise the Swiss bank to disclose the account details to the UK.

Article XVIII of the Protocol gave the UK the right to have any beneficial changes in the operation of the formula which calculates the one-off payment for the past agreed between Switzerland and Germany incorporated into the UK Agreement.

On 18 April 2012 letters were exchanged informing Switzerland that the UK wished to exercise this right. This means that:

  • The minimum rate payable will increase from 19 per cent to 21 per cent.
  • Where under the original formula the tax rate applied in a specific case would have been 34 per cent, and that rate would have been applied to at least £1 million in relevant assets, then the tax rate applied will increase in steps of one percentage point for each additional £1 million, up to a maximum of 41 per cent. This means that the rate payable on £7 million or more will be 41 per cent.

Swiss Agreement - Remittance Basis; Finance Bill 2013 draft clauses (scroll down to page 21 out of 61) (PDF 620K)

Swiss/UK Tax Cooperation Agreement factsheet (PDF 78K)

Responses to frequently asked questions

If you have any questions regarding the implementation of the agreement email them to UK - Swiss Agreement.

You can read the text of the Agreement, Protocol, associated declarations and supporting legislation by following the links below.

UK/Swiss Protocol - Letters to implement changes to the formula which calculates the one-off payment for the past (PDF 118K)

Protocol to the Tax Agreement between the UK and Switzerland (PDF 62K)

Agreement between the Swiss Confederation and the UK on co-operation in the area of taxation (PDF 166K)

Joint Declaration concerning the equivalence of the Agreement (PDF 9K)

Declaration concerning the acquisition of customer data stolen from Swiss banks (PDF 8K)

Letter from HMRC on criminal investigations (PDF 10K)

Agreed minutes (PDF 9K)

Memo produced by HMT after meeting with Swiss bankers on issues raised in respect of cross border financial services (PDF 173K)

Note associated with the memorandum (PDF 9K)

Schedule 36 Agreement between UK and Switzerland (Opens new window)