DTAA Between India And Switzerland: Benefits, Rates and Tax Savings in 2025

The DTAA between India and Switzerland is a vital bilateral treaty created to ensure that individuals and companies are not taxed twice on the same income. This agreement offers significant relief to Non-Resident Indians (NRIs) and Swiss residents involved in cross-border activities. By establishing clear rules for taxation, providing tax credits, and implementing lower withholding tax rates, the treaty fosters foreign investment. It strengthens economic relations between the two nations, offering a predictable tax landscape for all.

DTAA Between India and Switzerland - Quick Information

For a concise overview, the table below highlights the fundamental details of the tax convention between the Republic of India and the Swiss Confederation.

Objective of the DTAA Between India and Switzerland

The core objective of the India-Switzerland DTAA is to fairly distribute taxing rights between the two countries to prevent double taxation on cross-border income. This favourable tax environment encourages mutual trade and investment. Additionally, the agreement is designed to combat tax evasion through systematic cooperation and exchange of information between the tax authorities of India and Switzerland.

Key Features of India-Switzerland DTAA

The agreement contains several key features that outline its benefits and how it is applied. Here are the most critical aspects of this tax treaty.

Scope of the agreement

• The treaty's scope is designed to be comprehensive, applying to all taxes on income levied by both India and Switzerland, regardless of the method of taxation. 
• For India, it covers income tax, including any surcharges. For Switzerland, it broadly applies to the federal, cantonal, and communal taxes on income, which encompass total income, earned income, capital gains, and industrial or commercial profits. 
• A 'future-proofing' clause ensures it also covers any identical or similar taxes introduced later.

Who can claim DTAA benefits (residents, companies, trusts, etc)?

• To claim benefits under the DTAA, a person or entity must be a 'resident' of one or both of the countries defined by the domestic tax laws of each nation, typically based on factors such as domicile, place of management, or place of incorporation. 
• This broad definition ensures that individuals, companies, partnerships, and other taxable entities engaging in cross-border transactions can access the treaty's provisions for tax relief.

What are the Tax Relief Methods Used in the India-Switzerland DTAA?

• If an Indian resident earns income in Switzerland that is taxed there, India will allow a credit for the Swiss tax paid against its tax liability on that income. 
• Switzerland offers a similar credit for Indian taxes. This method ensures that while both countries may have a right to tax the income, the taxpayer's final burden is not doubled. General income tax rules for NRIs are a good starting point for understanding these concepts.

DTAA Rates Between India and Switzerland

The treaty provides for concessional tax rates on certain incomes, which is a major advantage for taxpayers involved in cross-border transactions between the two countries.

What documents are required to claim DTAA TDS?

To avail the lower Tax Deducted at Source (TDS) rates specified in the treaty, a non-resident must furnish the following documents to the payer in the source country.

• A valid Tax Residency Certificate (TRC) issued by the tax authorities of their home country.
• A self-attested copy of the Permanent Account Number (PAN) Card if allotted.
• A duly filled and signed Form 10F.
• A no-Permanent Establishment (PE) declaration, if applicable.

How to Claim DTAA Benefits?

The procedure for claiming DTAA benefits varies depending on whether you are an Indian resident earning income in Switzerland or a Swiss resident earning income in India.

In India (for Indian residents earning in Switzerland)

• Step 1- Report Global Income: As NRIs filing income tax returns, you must declare your total income, including any earnings from Switzerland.
• Step 2- Provide Proof of Tax Paid: You must provide official proof, such as tax receipts or statements from Swiss tax authorities, confirming the amount of tax paid in Switzerland.
• Step 3- File Form 67: It is mandatory to file Form 67 on the income tax portal before submitting your return. This form is a declaration of foreign income and the taxes paid on it.
• Step 4- Claim Foreign Tax Credit (FTC): In your tax return, you can claim the FTC for the taxes paid in Switzerland. This credit reduces your Indian tax liability, effectively preventing double taxation. For managing your finances, knowing the difference between NRE and NRO accounts is also helpful.

In Switzerland (for NRIs earning in India)

• Step 1- Submit Documents in India: To benefit from the lower TDS rates, you must provide your Tax Residency Certificate (TRC) from Switzerland, along with Form 10F and your PAN, to the Indian entity making the payment.
• Step 2- Ensure Concessional TDS: The Indian payer will then deduct TDS at the lower rate prescribed in the treaty (e.g., 10% on interest) instead of the higher domestic rate. Obtaining a lower TDS certificate for NRIs can further simplify this.
• Step 3- Report Indian Income in Switzerland: You must report the income earned from India in your Swiss tax return.
• Step 4- Claim Credit in Switzerland: As per Swiss tax laws and the DTAA, you can claim a credit for the tax paid in India against your Swiss tax liability, thus avoiding double taxation. A clear NRI power of attorney guide can be essential for managing these affairs from abroad.

DTAA TDS Rate Chart (2025) – India-Switzerland

When a payment is made from India to a Swiss resident, the DTAAs between India and Switzerland TDS rates. This ensures that the tax withheld at source is limited, providing immediate relief to the recipient.

DTAA Impact on NRIs and Investors

The India-Switzerland DTAA offers substantial advantages to NRIs and investors by creating a more secure and financially efficient environment for cross-border activities.

• Tax Certainty: The treaty provides clear, legally binding rules for the taxation of various types of income. This helps investors structure their investments without fearing unexpected tax burdens.
• Reduced Withholding Tax: The capped TDS rates of 10% on dividends, interest, and royalties are significantly lower than India's standard domestic rates for non-residents. This increases the net returns on investments and improves cash flow for Swiss residents and NRIs. The rules around taxation for NRO accounts are directly impacted by these rates.
• Encourages Foreign Investment: Swiss companies are more inclined to invest in India, knowing that their profits will be taxed transparently.
• Prevention of Fiscal Evasion: The provision for the exchange of bank-related information helps both countries tackle tax evasion and ensures that the treaty's benefits are not misused for illicit purposes.
• Clarity on Capital Gains: The agreement provides clear guidelines on the taxation of capital gains. Proper legal due diligence for NRIs investing in Indian real estate remains a vital step.

How NoBroker Can Help with NRI Services?

Managing financial and legal obligations across two countries can be complex, especially when navigating the DTAA between India and Switzerland. NoBroker offers a suite of exclusive services for NRI property owners to simplify their property ownership journey. Our experts assist with property management, legal documentation, and tax compliance advice. We help you understand your obligations related to TDS, capital gains, and filing requirements, ensuring your investments in India are managed efficiently and in full compliance with the law.

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