Tax rules applicable to real estate funds
Investors should consider their own personal circumstances and seek independent advice from their financial adviser or other professional adviser as to possible financial, legal, tax and accounting consequences which they might encounter under the laws of the countries of their citizenship, residence or domicile and which might be relevant to the subscription, purchase, holding, redemption, or disposal of the real estate fund units.
This tax information is based on the current legal situation and practice and does not constitute tax or legal advice and/or any other recommendation. It is subject to changes in legislation, case law and the practices of the tax authorities. JSSREM has not verified and is unable to guarantee the accuracy and completeness of the tax information contained herein. Possible errors or incompleteness of the information do not constitute legal grounds (contractual or tacit) for liability, either with regard to direct, indirect or consequential damages. There is no obligation on the part of JSSREM or any other person to update the information.
The real estate fund has no legal personality in Switzerland. In principle, it is not subject to income tax or capital tax. Real estate funds with direct land ownership are the exception. In accordance with the Swiss Federal Direct Tax Act, income from direct land ownership is subject to taxation at the point of the fund itself, but is tax-free for unit holders. Similarly, the capital gains made on direct land ownership are only taxable for the real estate fund.
Federal withholding tax deducted from the real estate fund’s Swiss income can be reclaimed in full by the fund management company.
Distributions of the real estate fund’s income (to investors domiciled in Switzerland and abroad) are subject to a 35% federal withholding tax (tax withheld at source). The income and capital gains distributed in the form of separate coupons in respect of direct land ownership and capital gains arising from the disposal of shareholdings and other assets are not subject to withholding tax.
Investors domiciled in Switzerland may recover the withholding tax levied by listing the corresponding income in their tax return or by submitting a separate reimbursement request.
Investors domiciled abroad may request reimbursement of the federal withholding tax based on any existing double taxation agreement between Switzerland and their country of domicile. In the absence of any such agreement, this withholding tax reimbursement will not be possible.
The income distributed and/or gains made during the sale or return of units are not subject to EU taxation of savings in Switzerland.