Anticipatory tax: levying and reclaiming

Purpose of anticipatory tax

Anticipatory tax is levied directly from the party paying the taxable benefit, such as a bank or a company, and remitted to the Federal Tax Administration.

It serves as a safeguard: anyone who declares income correctly can reclaim the tax withheld. Anyone who fails to do so loses the right to a refund.

This principle is intended to create an incentive to declare investment income in full. For honest taxpayers, anticipatory tax is therefore generally a pass-through item that is refunded via the tax return.

In the interplay of the various types of tax, anticipatory tax thus plays a supporting role for income tax: it ensures that investment income does not simply remain untaxed, while the actual burden is ultimately borne through ordinary income tax once the income has been correctly declared.

Which income is affected?

Typical income subject to the deduction of anticipatory tax includes interest on bank balances and bonds as well as dividends on shares.

Not every investment is subject to anticipatory tax; the exact treatment depends on the type of income.

Distributions from certain collective investment schemes and individual insurance benefits may also be subject to anticipatory tax. What is ultimately decisive is the legal classification of the income in question, which, if in doubt, you can find in the guidelines or in the explanatory notes to the list of securities.

A typical example without specific figures: income from a simple savings account is regularly subject to anticipatory tax, whereas certain repayments of capital or pure repayments of nominal value may be exempt from it. This distinction is not always apparent at first glance and deserves particular attention when completing the list of securities.

The interplay with foreign withholding taxes must also be taken into account: income from foreign securities is often subject to a separate withholding tax levied abroad, which must be distinguished from Swiss anticipatory tax and can in some cases be reclaimed through a separate procedure.

Anyone who regularly invests in foreign securities should therefore find out about the respective refund procedures at an early stage in order to avoid double burdens as far as possible.

The deadlines and forms differ from country to country, which is why a one-size-fits-all approach rarely leads to the desired result.

• Interest on bank balances
• Income from bonds
• Dividends on shares of Swiss companies
• Certain benefits from collective investment schemes

Reclaiming through the tax return

For natural persons resident in Switzerland, the refund is generally claimed via the list of securities in the tax return.

The prerequisite is the complete and proper declaration of the relevant income within the applicable deadline.

In practical terms, this means that you must list all relevant accounts, custody accounts and securities in the list of securities and correctly enter the gross income attributable to them as well as the anticipatory tax deducted. The tax authority then compares this information with the reports of the banks and companies.

Special considerations in the case of late declaration

If income is not declared or is declared late, the right to a refund of the anticipatory tax may under certain circumstances be forfeited.

In certain cases, there are options for subsequent declaration; check this in your individual case with a specialist or the responsible tax administration.

Typical mistakes when reclaiming

A common mistake is simply forgetting individual accounts or custody accounts in the list of securities, particularly if a banking relationship was opened or closed during the year. Smaller amounts should also be listed in full so that the refund is not partially forfeited.

The deadline for claiming the refund is also occasionally underestimated: if the tax return is submitted late or income is corrected subsequently, this can delay the procedure or jeopardise the claim. Careful and timely preparation of the documents is therefore advisable.

Another pitfall concerns jointly held accounts or custody accounts, for example in the case of married couples or communities of heirs. Here, the allocation of the income and of the anticipatory tax deducted must be clearly and traceably documented so that the refund can be correctly attributed.

Anticipatory tax in an international context

Persons resident abroad can also apply for a refund under certain conditions, particularly if a double taxation agreement exists between Switzerland and their country of residence.

The procedure here differs from that for persons resident in Switzerland and often requires separate forms. In cross-border situations, an individual clarification is recommended.

It should also be noted that a double taxation agreement often only partially reduces the anticipatory tax and does not eliminate it entirely. The remaining portion is treated as a final burden in the country of residence, while the refundable portion can be claimed through the relevant procedure.

What you should have ready

• Bank certificates with details of anticipatory tax
• Complete the list of securities in full
• Collect dividend and interest statements
• Meet the deadlines for the tax return
• Check that the declared income is complete
• Ask at an early stage if anything is unclear

Frequently asked questions