Taxation of Trusts in Switzerland

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The Hague Convention (Article. 19) stipulates that the Convention does not prejudice the powers of sovereign states in fiscal matters. Consequently, Switzerland has maintained its sovereignty in relation to the tax treatment of trusts.

The tax advantages available in using a trust with a Swiss Trustee essentially depend on the tax residence of the Settlor and the Beneficiaries.

In terms of Swiss Law:

A Swiss resident Trustee is not liable to Swiss income tax or capital gains tax on the malta mobile database assets held under management in a trust.
Settlors and Beneficiaries are exempt from Swiss taxation as long as they are not considered to be Swiss residents.
Why Use a Swiss Trustee?
In addition to the potential tax advantages detailed above, there are a number of reasons why use of a Swiss Trustee can be advantageous:

Switzerland has a long established reputation for discreet professional support when managing the affairs of wealthy private individuals.
Switzerland is located in the centre of Europe, where many affluent individuals are based. Swiss Trustees therefore offer the advantage of being able to provide frequent and high quality support as they can regularly liaise with and, when appropriate, meet with clients and/or other professional advisers.
Swiss economic, political and legal stability provides a solid base for the provision of high quality support and administration services.
Switzerland has a number of favourable and well developed banking laws, and has been a popular international private banking centre for many years. It is a jurisdiction with a good reputation and offers a high quality of knowledgeable professionals working within asset management, tax planning and private banking.