Amendments to the double taxation agreement with Denmark in force

Bern, 01.12.2010 - The protocol to amend the double taxation agreement (DTA) between Switzerland and Denmark has entered into force. Aside from a provision on the exchange of information in accordance with the OECD standard, the inclusion of an arbitration clause was also agreed with Denmark. A new provision on the general right of the source state to levy a 15% tax on dividends has been introduced. However, dividends paid to holders of a capital stake of at least 10% as well as those paid to Pillar 1, 2 and 3a pension institutions will remain exempt. The right to tax pensions from private pension schemes will now lie primarily with the source state.

Switzerland and Denmark informed one another via diplomatic channels that all of the conditions and legal procedures for this protocol's entry into force had been met. Upon receipt of the second note, the agreement entered into force on 22 November 2010, and the extension to the Faroe Islands came into effect on 29 November 2010. The application of a DTA's new provisions is always based on the arrangements stipulated in the agreement. As a rule, the new provisions are applicable from 1 January of the calendar year following the date of entry into force.

The provisions of the Protocol of Amendment with Denmark will apply to dividends payable on or after 1 January 2011. The provisions will apply for pensions payable on or after 1 January 2011 (excluding pensions that were already in progress when the protocol was signed and that are paid to recipients who transferred their domicile from one contracting state to the other contracting state before this date).  Contributions paid into Swiss pension institutions by Swiss citizens resident in Denmark will be eligible for deduction from their taxable income for tax years that commence on or after 1 January 2011. The provisions on the exchange of information will have effect for tax years that commence on or after 1 January 2011.

The protocol with Denmark to amend the DTA with respect to taxes on income and capital was signed in Bern on 21 August 2009, and was approved by parliament on 18 June 2010. The referendum deadline expired unused on 7 October 2010.

Address for enquiries

Pascal Duss, Division for International Affairs, Federal Tax Administration, tel. 031 322 71 57


Federal Department of Finance