FTA updated its summary of the tax treaty with Brazil on 26 March 2026, reflecting changes to Brazil’s domestic withholding tax rules effective 1 January 2026.
The Swiss Federal Tax Administration (FTA) released a revised overview on 26 March 2026, detailing the impact of the tax treaty with Brazil. The update incorporates two key modifications to Brazil’s domestic withholding tax rules, effective from 1 January 2026.
This summary details the tax convention effects between Switzerland and Brazil as of 1 January 2026.
Tax Rates and Relief
The following withholding tax (WHT) rates and treaty reliefs apply to income originating in Brazil:
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- Dividends: Since 1 January 2026, dividends are subject to a 10% withholding tax (they were previously exempt). However, they are exempt if the beneficial owner is a Swiss pension fund or the Swiss National Bank.
- Interest:
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- The standard treaty rate is 15%.
- Interest on equity (remuneração sobre o capital próprio) is taxed at 17.5% (increased from 15% after 31 December 2025).
- A reduced rate of 10% applies if the beneficial owner is a Swiss bank and the loan is for at least 5 years to finance equipment or investment projects.
- Exemptions apply if the interest is paid to a Swiss pension fund, the Swiss National Bank, or Swiss government agencies. Additionally, no tax is levied on export loans from specific government or credit agencies.
- Royalties: A 15% rate applies specifically to trademarks, while a 10% rate applies in all other cases.
- Service Fees: These are subject to a 10% withholding tax.
Procedural requirements
To benefit from these treaty reductions, taxpayers must generally present a certificate of residence issued by their Swiss cantonal tax authorities. A specific Brazilian form, the Atestado de residência fiscal no exterior, is required for this purpose. For companies, the cantonal authorities will provide a copy of this certificate to the Swiss Federal Tax Administration.
Swiss tax relief
Regarding the imputation of foreign withholding taxes in Switzerland, taxpayers should refer to Notice DA-M provided by the Federal Tax Administration.
