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International Tax Collection

20 June 2016
KENDRIS Author(s): 


Switzerland has signed a Convention on Mutual Administrative Assistance in Tax Matters with the Council of Europe and OECD member countries. The Convention envisages improved cross-border cooperation. Up to now, states could only submit an official request for administrative assistance to foreign countries if they had reasonable grounds for suspecting that a taxpayer owned untaxed assets abroad.

The new, more intensive cooperation includes the automatic exchange of information which involves states exchanging bank account information directly.

From now on, information will be sent to the relevant foreign tax authority without any official request for administrative assistance – automatically and without the involvement of the foreign authority.

However, Switzerland envisages other forms of administrative assistance in addition to the exchange of information. For instance, foreign states should in future be able to post official documents directly to the relevant taxpayers in Switzerland. Furthermore, Switzerland will also provide administrative assistance in relation to the enforcement and securing of foreign tax claims. This means nothing other than that Switzerland will become an extended arm of foreign tax authorities and enforce foreign tax claims against foreigners living in Switzerland. In addition, it will also guarantee settlement thereof under debt enforcement legislation. In this respect, it will be irrelevant whether it involves taxes on income/assets or taxes on foreign properties. In future, Switzerland will be able to seize any assets in the country in order to secure unpaid foreign tax debts and ultimately enforce payment thereof.

Are you potentially affected by international tax collection? Or have administrative assistance proceedings been initiated against you? We can help you.