Swiss Tax – The One Pager

The double taxation agreement (DTA) between Switzerland and Germany has been amended by a comprehensive amendment protocol, which came into force on November 27, 2025. With a few exceptions, the amendments apply from January 1, 2026. The main aim of the protocol is to implement the OECD BEPS minimum standards, introduce the principal purpose test, and amend individual provisions in line with the 2017 OECD Model Tax Convention. This is intended to increase legal certainty and further strengthen cross-border cooperation between the two contracting states.

Overview of the most important amendments

The amendment protocol introduces expanded anti-abuse provisions. The preamble already makes it clear that no tax benefits will be granted in cases of treaty abuse. In addition, a general anti-abuse clause in the form of the principal purpose test is introduced, according to which a treaty benefit will be denied if obtaining it is one of the main purposes of the arrangement. In addition, the conditions for the exemption of certain types of income are clarified, in particular with regard to dividends paid to tax-exempt companies, income from hybrid structures, and income that is exempt from taxation in the other contracting state.

The protocol introduces significant changes in the area of permanent establishments (PE). Representative offices are excluded if they perform exclusively ancillary activities. Profit determination is now consistently based on the Authorized OECD Approach, according to which the PE is to be treated as an independent and autonomous enterprise; the previously permissible proportional allocation of profits no longer applies. Art. 7 para. 3 DTA CH-GE now provides for counter-adjustments if a primary adjustment leads to double taxation and the competent authority of the other contracting state agrees. In addition, art. 9 DTA CH-GE introduces a profit adjustment clause for intra-group profit offsets, including counter-adjustments in the context of mutual agreement procedures.

The taxation of self-employment is now regulated under art. 7 DTA CH-GE. In addition, the conditions for withholding tax reductions on dividends, interests, and royalties are specified, particularly with regard to usage rights and the introduction of a minimum holding period of 365 days for qualified participations of at least 10%. Partnerships do not qualify for full withholding tax relief but may apply for a refund up to the respective residual rate.

Takeaways

• The amendment protocol to the DTA CH-GE came into force on November 27, 2025, with most changes applying from January 1, 2026.
• The protocol implements BEPS minimum standards, tightens anti-abuse rules, and aligns the agreement with the 2017 OECD Model Tax Convention.
• Permanent establishments will in the future be treated in accordance with the Authorized OECD Approach; representative offices engaged exclusively in auxiliary activities are excluded; counter-reporting and intra-group profit adjustments are now clearly regulated.
• Withholding tax on dividends, interest, and license payments has been clarified.