Valordata Feed (VDF) is a fully structured and encoded financial data feed offering near-real time delivery of reference data.
Final Withholding Tax Agreements
The bilateral tax agreements with Austria, the UK and Switzerland entered into force as of 1 January 2013. The implementation of these agreements signifies a milestone in the the Swiss financial market place strategy. Negotiations concerning agreements with other countries are under way.
The final withholding tax is deducted by a paying agent (usually a bank) from interest income, dividends and other investment income and forwarded anonymously to the Swiss Federal Tax Administration (FTA). The latter will then transfer the tax to the tax authority in the partner country, which settles the tax obligation.
In December 2009, the Federal Council spoke in favor of a forward strategy in its report concerning the strategic initiatives for Switzerland's financial market policy. At the end of October 2010, Switzerland achieved the first successes in implementing its strategy with the UK and Germany, signing a mutual agreement with both countries concerning open financial and tax issues.
In early 2011, negotiations commenced to find a solution suitable for regularizing the past that would also be a good fit for the future. The center piece of the agreement is a new withholding tax system capable of satisfying the tax demands of partner countries while respecting the privacy of banking clients.
The first two agreements with Germany and the UK were signed in autumn 2011, the agreement with Austria was finalized in April 2012. The agreements enable residents in a partner country to regularize their existing banking relationships in Switzerland by either paying withholding tax on investment income in future, or, with the agreement of the client, disclosing such investment income to foreign tax authorities. The agreements, which took effect on 1 January 2013, will also enable previously untaxed client assets to be regularized by means of a one-off payment.
On the 12 December 2012, the upper house of the German parliament decided to reject the bilateral tax agreement with Switzerland. As a result, the previously implemented SIX structures, content and services for the German tax agreements are no longer valid. However, SIX will continue to keep the current structure in place in the event that the talks with Germany resume.
New bilateral tax agreements with other big neighboring countries are expected to be concluded in 2013, and as in the past, SIX is readying its data feeds to accommodate the implementation of the new agreements in advance. For SIX, the continuous enhancement of data and offerings to meet regulatory and compliance requirements is deeply embedded in its business strategy of delivering services in an efficient, broad and timely manner.
The role of SIX
As the main infrastructure provider for the Swiss financial market place and a joint undertaking of the Swiss banks, SIX aims to provide its clients with innovative solutions for implementing the final withholding tax. Its intention is to help ensure that the new final withholding tax system is applied efficiently throughout the Swiss banking sector.
To this end, SIX has launched a working group tasked with developing sector-wide solutions based on the needs of banks. Alongside the various business areas of SIX , the working group also comprises experts from the banks and from the Swiss Bankers Association.
In parallel to the political proceedings, the FTA has set up two working groups in September 2011, which wrote the guidelines (“Wegleitung”) for the treaties. One working group covered regularization of the past, while the other covered the future. SIX is represented in the working groups developing these guidelines.
Solutions by SIX
Enhanced data offering. SIX Financial Information has enhanced the existing data feeds with the information the banks require to calculate the applicable final withholding tax for the UK and Austria. This concerns reference, market and corporate actions data. The structure and content of these enhancements is based on the agreements (especially the concordance tables) and on the guidelines which have been designed by the FTA.
- Swiss Bankers Association (SBA)
- State Secretariat for International Financial Matters (SIF)
- Swiss Federal Department of Finance (FDF)