On 19/20 February 2018, the Swiss Federal Tax Administration (FTA) published the tax-recognised interest rates for advances or loans in Swiss francs and foreign currencies for 2018.
The granting of interest-free or insufficiently interest-bearing advances or loans to participants or third parties related to them constitutes a payment in kind. This shall also apply to translated interest which is paid on the basis of obligations towards parties involved or third parties close to them.
The following two FTA circulars provide information on the appropriate interest rate for advances or loans in Swiss francs and foreign currencies:
The interest rates recognised for tax purposes for advances or loans in Swiss francs remain unchanged compared with the previous year.
The interest rates recognised for tax purposes for advances or loans in foreign currencies were partially adjusted compared with the previous year (including USD: from 2.5% to 3.0%; EUR: unchanged at 0.75%). The adjusted interest rates are based on the 5-year swap rates and on the return on long-term investments.
