Direct real estate investment
Revenues and profits from real estate are usually taxed in the Canton or state in which the real estate is located.
Indirect real estate investment / transfer of ownership
The procedure is similar when a majority interest is transferred to a real estate company (= transfer of ownership). As far as inter-cantonal relationships within Switzerland are concerned, such a majority interest qualifies as an immovable property asset and taxation authority is assigned to the Canton in which the real estate is located. In the international arena, in the case of all DTA’s that follow the old OECD Model Convention, taxation authority on the sale of shares more than 50% of the value of which depends directly or indirectly on real estate is assigned to the state of domicile of the seller of the shares. In the same circumstances, DTA’s which already follow the new OECD Model Convention assign taxation authority to the state in which the real estate is located.