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Introduction to Stamp Tax

As per the Swiss regulation, the Stamp tax has to be calculated based on the instrument, customer group and transaction type. This covers the calculation of Swiss Stamp tax during the corporate action process and includes the income report along with the withholding tax paid details.

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Annual Tax Statement

The yearly tax statements for the Swiss customers are prepared in accordance with the Swiss tax rules.

The statements are sent to the Swiss customers after the year end and the report contains the following:

• Asset value per item as of the last working day of the year.
• Taxable income per security during the calendar year.
• Swiss withholding tax withheld.
• Foreign withholding taxes withheld and non-reclaimable amounts.
• Customer’s liabilities towards the bank.
• Interest paid on such liabilities.
• Total of banking fees charged and separately VAT charged.

Stamp Duty

Swiss Stamp Tax (SST) liability arises if a Swiss securities dealer is involved in the transfer of ownership of taxable securities.

Any transfer of ownership other than by way of a gift of taxable securities where one party in the transaction is a Swiss securities dealer acting on its own account or as an intermediary is subject to SST.

Taxable securities for stamp tax purpose are in particular:

• Swiss and foreign bonds.
• Swiss and foreign shares.
• Swiss and foreign investment fund units.

Swiss securities dealers for SST purposes are in particular:

• Banks and Bank-like financial institutions subject to the Federal Banking Law as well as the Swiss National Bank.
• Swiss individuals, corporate entities and partnerships as well as branches of foreign enterprises whose activities exclusively or substantially encompass the trading of securities on third parties‘ accounts or brokering such securities as portfolio managers.
• Swiss companies whose assets include taxable securities with a book value in excess of CHF 10 million.
• Swiss pension funds, Swiss public entities and Swiss social security institutions, whose assets include taxable securities with a book value in excess of CHF 10 million.
• As of 1 January 2006: Old age and survivor’s compensation funds, as well as unemployment compensation funds, will no longer qualify as securities dealers for SST purposes. However, this new exemption does not concern old age and survivor’s or unemployment investment foundations, which remain securities dealers for SST purposes.

The basis for assessing SST is generally the consideration for the transfer of ownership of the taxable securities.

The following tax rates are applicable:

• 1,5 per mill (15 bps) of the consideration in the case of Swiss securities.
• 3 per mill (30 bps) of the consideration in the case of foreign securities.