For more information on transfer pricing in Switzerland, please contact: For bilateral or multilateral APAs, the competent authority is the SIF, which is a federal authority and independent of the federal and cantonal tax authorities. Within the RIS, the staff responsible for transfer pricing issues is separated from the other departments of the RIS. If the above conditions are not met, the RIS will refuse to initiate an amicable procedure. Here you will find basic information about the mutual agreement procedure: The taxpayer is informed of the outcome of the mutual agreement procedure. As a rule, he has 30 days to accept the implementation of the mutual agreement procedure. If the taxpayer agrees, he will be asked to waive legal remedies in respect of the issues for which a solution has been found by mutual agreement. If the taxpayer is not satisfied with the mutual agreement signed by the competent authorities, he has no recourse against this agreement. If he refuses to implement the agreement, it will not be implemented, but the mutual agreement procedure will always be over. If the implementation of the mutual agreement is rejected, the taxpayer may have recourse to a Swiss domestic appeal procedure against the Swiss tax decision if the conditions are met.
The SIF informs the competent Swiss tax authorities of the outcome of the mutual agreement procedure and, if the taxpayer has consented, instructs it to automatically implement the mutual agreement. Does the country have an Advance Pricing Agreement (APA) program? If so, is the program widely used? Are there unilateral, bilateral and multilateral ABS? In transfer pricing cases, at least two notices are usually required. First of all, an advance ruling on the consequences of withholding tax and/or stamp duty is requested from the Federal Tax Administration. Secondly, a preliminary ruling on the consequences of corporation tax is sought from the competent cantonal tax authorities. The law does not define the duration of Swiss tax rulings. In practice, decisions are often either without a limited time or take three years. However, decisions remain valid only as long as the factual facts are consistent with the facts disclosed therein and the relevant law does not change. The period of validity of an initial price agreement will be regularly negotiated between the parties.
As a general rule, the Federal Tax Administration proposes a period of several years. Prior bilateral or multilateral arrangements to be negotiated through the State Secretariat for International Financial Matters follow the same principles. The time taken to obtain an advance tax ruling in Switzerland depends on the tax authorities to be contacted and the complexity of the facts and legal issues. In practice, it can take anywhere from a few days to several months for a legally binding decision to be rendered. If the ISP considers that the conditions for the opening of a mutual agreement procedure are fulfilled and finds that the double taxation that has occurred cannot be eliminated unilaterally, it shall initiate the mutual agreement procedure and inform the competent authority of the State concerned of the request for a mutual agreement procedure. The Swiss tax authorities concerned will also be informed of the opening of a mutual agreement procedure. The taxpayer does not participate in the procedure itself. The competent authorities shall endeavour to eliminate or prevent double taxation by means of direct oral or written communications. The mutual agreement procedure is free of charge. The taxpayer shall bear his own costs in respect of the application (in particular the agent`s costs due). National tax legislation does not provide for specific agreements on advance prices; however, it is common to apply for Swiss tax rulings. These tax rulings contain a description of the facts (e.g.
B a mechanism for determining the transfer pricing between related parties to be implemented and the resulting tax consequences). .