The double taxation treaty allows for parties to avoid double taxation in the US and Switzerland on the following:
- in Switzerland: the taxes covered are the federal, cantonal and communal taxes on income; they include total income, earned income, property income, business profits, etc.
- in the United States of America: the federal income taxes imposed by the Internal Revenue Code and certain excise taxes.
The treaty also applies to other taxes which are implemented and deducted after the double taxation treaty was signed. So this means that if a new tax becomes law, the double taxation treaty still applies. On top of this, the US and Switzerland are required to notify each other of taxation changes.
With over 80 double tax treaties signed by Switzerland, it can be a complex task to understand how each one works for each nation. For more information on these treaties, feel free to contact our business incorporation agents.