Real Estate Companies (SI): Taxation and Yield Repatriation for Non-Residents

The stability of the Swiss real estate market attracts many non-resident investors. Whether you are established in neighboring France or elsewhere in the world, the structuring of this investment is frequently done through a Real Estate Company (Société Immobilière or SI), usually in the form of a Public Limited Company (SA).

However, this legal setup requires a careful reading of cross-border tax rules and a financial optimization strategy when paying out yields.

1. The Tax Functioning of a Swiss SI

In Switzerland, a Real Estate Company is subject to taxes on its profit (net rental income) and on its capital, levied at the federal, cantonal, and communal levels. The location of the property defines the main place of taxation.

Tax Liability by Economic Attachment

Even if the sole shareholder of the SI resides abroad, the company remains fully taxable in Switzerland. The generated rental income can only be transferred to the shareholder in the form of dividends, once the SI has fulfilled its own corporate tax obligations.

2. Withholding Tax and Double Taxation Agreements (DTA)

The distribution of profits is the critical moment for the non-resident investor. The Federal Tax Administration (FTA) levies a withholding tax of 35% on dividends paid by the SI.

The Example of European Residents

In accordance with Double Taxation Agreements (such as the Swiss-French DTA), the investor domiciled abroad declares these dividends to their local tax administration. The DTA generally allows for the final tax burden to be limited:

• Switzerland retains a residual tax (generally 15%).
• The balance (20%) may be refunded to the investor upon presentation of specific forms (such as Form 83 for France) duly validated by the foreign tax authorities.

It is strongly recommended to have this setup validated by a certified public accountant or a tax lawyer specialized in cross-border matters to ensure full compliance of the declaration.

3. Fund Repatriation: Avoiding Yield Erosion

Once dividends or rents have been distributed and taxes settled, the investor faces the challenge of currency transfer. Repatriating Swiss Francs (CHF) to an account in Euros (EUR) or another currency using a traditional bank is the most costly mistake made by investors.

Traditional banks charge high fixed fees, correspondent fees, and above all, apply an opaque exchange rate margin (spread) compared to the real interbank rate.

4. The ibani Method for Securing Your Yields

To optimize the net performance of your Swiss real estate investment, ibani provides investors and Real Estate Companies with a bespoke financial infrastructure and completely transparent pricing:

• From 100,000 CHF to 250,000 CHF: Exchange rate margin of only 0.15%.
• From 250,000 CHF to 500,000 CHF: Exchange rate margin of 0.09%.
• Above 500,000 CHF: Exchange rate margin of 0.05%.

In practical terms, the SI pays the dividends in CHF to a dedicated Swiss IBAN assigned to you, via a simple, free domestic transfer. Your funds are converted into Euros without hidden margins and the transfer to your European bank account is automatically triggered on the same day.