Switzerland levies 35% withholding tax on interest and dividends paid out by Swiss companies. In practice the vast majority of international clients do not pay this tax.

The Swiss withholding tax is payable only on a limited number of investments:

• Dividends paid by Swiss companies . If you buy shares in Nestlé or Novartis 35% of any dividends will be withheld as a tax. This applies no matter where you live and whether you invest from a Swiss bank account or not. Many Swiss companies resort to share buy backs to bypass the withholding tax altogether.
• Interest paid by Swiss companies. If you buy bonds issued by a Swiss company, the company will retain 35% of the interest coupons. Same thing for example for a Swiss franc savings account, the bank will retain 35% of the interest. The way not to pay this interest is to ask your banker to invest your money in a money market fund or a fiduciary deposit outside Switzerland.

You can claim back this withholding tax if you are a Swiss taxpayer or if your country has a double taxation agreement.