Switzerland and Australia have signed a new double taxation agreement (DTA) in the area of taxes on income.
The new DTA will replace the agreement applicable since 1981 and contains provisions on the exchange of information in accordance with the currently applicable international standard.
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The agreement signed in Sydney, will contribute to the further positive development of bilateral economic relations between Switzerland and Australia, which is a member of the G20.
As a part of the agreement, Switzerland and Australia have agreed that both countries may levy withholding tax of not more than 5% on gross dividends earned on significant interests (previously 15%).
Furthermore, no withholding tax will be levied on dividends and interest paid to pension funds and financial institutions, while the withholding tax rate for royalties will be reduced from 10% to 5%.
The new agreement has to be approved by parliament in both countries before it can come into force. It is subject to an optional referendum in Switzerland.
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