Withholding tax: amendments to the notification procedure in a group of companies as of the 1st of January 2023

The notification procedure in a group will be allowed as of 1 January 2023 for shareholdings of 10% or more and will be extended to all legal entities. The authorisation to carry out the notification procedure in an international context will be valid for five years.

As of the 1st of January 2023, the scope of the notification procedure will be extended (see Ordinance of 4 May 2022 on the Group Notification Procedure for Withholding Tax; RU 2022 307 ; please note: this Ordinance is not available in English). Hence, the group notification procedure will be permitted for shareholdings of 10% (currently 20%) or more and for all legal entities holding such a qualifying shareholding. Furthermore, the authorisation required in the international context to apply the notification procedure will be valid for five years, instead of three years.

Reminder of general principles

According to article 1 paragraph 1 of the Swiss Federal Law of 13 October 1965 on withholding tax (WHTL; RS 642.21), the Confederation levies a withholding tax on capital gains, on winnings from gambling, on winnings from games of skill or lotteries for sales promotion and on insurance benefits.

In the case of capital gains subject to withholding tax, the tax claim arises at the time the taxable payment falls due (see Art. 12 para. 1 WHTL) According to Art. 16 para. 1 lit. c WHTL, withholding tax is due 30 days after the tax claim arises.

A characteristic feature of the withholding tax system is that the withholding tax is levied on an anonymous basis; the identity of the recipient is not disclosed to the tax authorities until the application for reimbursement of the withholding tax is filed by the recipient of the taxable benefit.

In the case of benefits (dividends and their equivalent) paid in a group, the taxpayer may be allowed to fulfil his tax obligation by notifying the taxable benefit instead of paying the tax. If the taxpayer fulfils the necessary requirements to apply this procedure, he must declare the taxable payment to the Federal Tax Administration (FTA) within 30 days after the tax liability has arisen.

The notification procedure is possible both domestically and at the international level.

Reminder of certain practical elements related to the notification procedure

According to established jurisprudence, the notification procedure is allowed at the Swiss level if there is no doubt as to the right to reimbursement. If there is no entitlement to a reimbursement - or if there is a doubt as to the entitlement - the declaration procedure must be rejected and the withholding tax must be collected according to the ordinary procedure (i.e. by paying the tax). In this case, the debtor of the taxable benefit will be charged interest on default on the tax due from the due date until payment. 

A late notification of a benefit subject to withholding tax does not entail the loss of the right to request the application of the notification procedure if the requirements for its granting are met. Nevertheless, failure to comply with the legal deadline may be sanctioned with a fine in accordance with Article 64 of the LIA.

Transition clause

For future changes in the notification procedure (national and international), the text of the ordinance is binding. Consequently, the former law still applies to requests (forms) submitted up to and including 31 December 2022.

In this case, the legislator provides for the date of filing of the request as the relevant factor for the application of the previous or the new legislation. The date of the postmark is therefore decisive.

Online declaration

The possibility of filing an online notification via the FTA portal is not yet available. The range of digital processes is constantly evolving and it is planned that in future it will also be possible to submit notifications online. The FTA will inform the public as soon as this feature is available.


Last modification 20.07.2023

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