Doppelbesteuerung

Art. 11 MA Zinsen

Bearbeiter: Prof. Dr. Dr. h. c. Franz Wassermeyer und Dr. Christian Kaeser

A. Musterkommentar

I. Preliminary remarks

1. “Interest” is generally taken to mean remuneration on money lent, being remuneration coming within the category of “income from movable capital” (revenus de capitaux mobiliers). Unlike dividends, interest does not suffer economic double taxation, that is, it is not taxed both in the hands of the debtor and in the hands of the creditor. Unless it is provided to the contrary by the contract, payment of the tax charged on interest falls on the recipient. If it happens that the debtor undertakes to bear any tax chargeable at the source, this is as though he had agreed to pay his creditor additional interest corresponding to such tax.

2. But, like dividends, interest on bonds or debentures or loans usually attracts tax charged by deduction at the source when the interest is paid. This method is, in fact, commonly used for practical reasons, as the tax charged at the source can constitute an advance of the tax payable by the recipient in respect of his total income or profits. If in such a case the recipient is a resident of the country which practises dedu...