TAX DETAIL
Tax treatment of a participation in the Cooperative GENO INVEST SUISSE
The cooperative in Switzerland is a legal entity (the same applies to cooperatives in most European countries). The cooperative share has a nominal value, which represents your participation/your share in this cooperative. The cooperative GENO INVEST SUISSE pays tax on the profits itself in accordance with local legal provisions. The domicile of our cooperative is the community of Freienbach in the canton of Schwyz (district of Pfäffikon SZ). Canton Schwyz is the second cheapest canton in terms of taxes in Switzerland.
In the canton of Schwyz, Freienbach is again the second cheapest municipality within the canton for legal entities.
The profits generated by the cooperative are therefore not “eaten up” by taxes in advance. Profit distributions (dividends and other payments to the owners of corporations) are subject to a standard withholding tax (source tax) of 35% in Switzerland. This is regulated in the federal law on withholding tax
https://fedlex.data.admin.ch/filestore/fedlex.data.admin.ch/eli/cc/1966/371_385_384/20190101/de/pdf-a/fedlex-data-admin-ch-eli-cc- 1966-371_385_384-20190101-en-pdf-a.pdf
This tax, levied at source, can be reclaimed from taxpayers if properly declared in the tax return.
Natural or legal persons living in Switzerland
Individuals who are subject to tax in Switzerland simply have to enter the portfolio and income in the list of securities in the annual tax return, analogous to a participation in the local Raiffeisen bank or other securities. It is important that the withholding tax of 35% is reclaimed as a result.
A subsequent sale of the share certificates at a price of more than 100% is tax-free for natural persons in Switzerland (capital gain). For members of the cooperative who are themselves legal entities, it should be noted that the investment can only be used in the balance sheet at the purchase price.
Natural or legal persons living in the European Union or in third countries
Natural persons who do not live in Switzerland or legal persons domiciled abroad can also reclaim the Swiss withholding tax. It should be noted here that Switzerland’s double taxation agreements were not concluded with the EU, but with each country individually, which is why we will only go into detail here about cooperative members from Germany.
The reclaim of the withholding tax is subject to the double taxation law, which exists between Switzerland and Germany.
https://www.estv.admin.ch/estv/de/home/internationales-steuerrecht/international-laender/sif/deutschland.html
Natural persons who do not live in Switzerland or legal persons domiciled abroad can also reclaim the Swiss withholding tax. The following procedure applies here:
The refund can be requested online:
https://www.estv.admin.ch/estv/de/home/verrechnungssteuer/vst-rueckerstätten.html
Fast and secure refund of withholding tax
- The ESTV Suisse Tax portal offers you the following functions:
Electronic Refund Form 25 - Business overview of applications submitted online
- Electronic user management (adding and changing user rights)
The site has a simple structure and the necessary explanations are available. Loans to Swiss corporations and their interest are not subject to withholding tax. In the case of mixed forms (participation and loan), only the profit distributions from the participation are subject to 35% withholding tax.
