Switzerland and Ukraine signed the protocol of amendment on 24 January 2019. The cantons and the business circles concerned have welcomed the conclusion of the protocol. It still has to be approved by parliament in both countries before it can come into force.
The protocol of amendment contains an abuse clause which refers to the main purpose of an arrangement or transaction and thus ensures that the DTA is not abused. In order to increase legal certainty for taxpayers, an arbitration clause has also been added to the agreement. Finally, the agreement contains an administrative assistance clause in accordance with the international standard for the exchange of information upon request.
Concerning the taxation of dividends, a stake of 10% in the distributing company, instead of the current 20%, will be regarded as a qualified participation in the future. Moreover, dividends paid to the National Bank or to the contracting states will be taxable only in the beneficial owner's state of domicile. Finally, a residual tax rate of 5% is planned for both interest and royalty payments.
Address for enquiries:
Frank Wettstein, Co-Head of Communications, State Secretariat for International Finance
Tel. +41 58 462 38 56, firstname.lastname@example.org