The Swiss withholding tax also governs the dividend tax and Swiss laws
require dividends to be taxed at a rate of 35%, which is also the withholding tax.
Company shareholders are required to declare their dividend as income for tax reasons. In tax terms, the gross dividend is what the dividend amount is before tax is deducted, and the net dividend is what is left over of the dividend after tax has been taken out. The overall size of the gross dividend dictates the taxable income, so, a higher dividend will mean a higher taxable income.
The main deciders of the companies profit are the board of directors. These directors are in charge of deciding how much of the profit remains within the business. This decision has no minimum or maximum amount, it also doesn't need to meet a required dividend size, it can be any size. Although most companies in Switzerland create a dividend policy which creates more stability.
The main goal and more stable option are to choose to keep the dividend amounts the same every year regardless of financial outcomes.
Please feel free to contact our consultants for more information on Swiss dividend tax or company formation information.
Check Corporate taxes in Switzerland