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Switzerland, Bahrain Sign DTA

Monday, December 2, 2019

On November 25, 2019, Switzerland and Bahrain signed a double tax agreement that caps maximum withholding tax rates and provides for the exchange of information.

Under the agreement, dividends can be taxed at a maximum of 15 percent in the source state. The withholding tax rate on dividends from significant interests will be capped at a maximum of five percent in the source state.

Interest and royalties will be taxable solely in the recipient's state of domicile.

The agreement also contains an administrative assistance provision in accordance with the international standard concerning the exchange of information upon request. It contains an anti-abuse provision, which refers to the main purpose of an arrangement, which is in line with the recommendations made as part of the OECD's BEPS project.

The agreement must be approved by both countries before it can enter into force.