Germany and Switzerland: how each taxes an Indian fund
Germany taxes payouts, a yearly deemed amount and sale gains. Switzerland leaves private sale gains untaxed but taxes income and wealth. Here are the rules, the numbers and what is not settled.
Prepared by Prem Tax and Accounting Corp. Last checked against official sources on November 5, 2026.
Germany and Switzerland treat an Indian fund in almost opposite ways. Our Berlin-to-Bern Record Sheet keeps the records for both. Your adviser there files; we work alongside. See the countries guide and our Indian CPA page.
- Germany taxes payouts (before Indian tax), a yearly lump sum called the Vorabpauschale, and sale gains. No German bank withholds, so you declare them.
- The lump sum uses a base rate of 2.53% for 2025 and 3.20% for 2026; the 2025 amount counts as received on January 2, 2026.
- Switzerland does not tax private sale gains. It taxes payouts, a growth plan's net income and, by canton, wealth.
The numbers
| Item | Rule | Year |
|---|---|---|
| German rate | 25% plus 5.5% is 26.375%; church tax makes it 27.82% or 27.995%; allowance EUR 1,000 (EUR 2,000 joint) | 2025, 2026 |
| Treaty cap on Indian tax, dividends | Germany 10%; Switzerland 10% (5% from April 28, 2020 to December 31, 2024) | 2025, 2026 |
| Zurich wealth tax, single | Nothing on the first CHF 81,000, then 0.5 to 3 per mille (per thousand), times 95% (canton) plus 119% (city) | 2026 |
Invented examples
Germany, 2025: a single resident with no church tax holds a growth plan worth EUR 10,000 on January 1 and EUR 11,200 on December 31, with no payouts. The lump sum is 10,000 x 70% x 2.53% = EUR 177.10. Tax is EUR 46.71, or EUR 32.70 if the 30% exemption is proved, before the allowance.
Zurich, 2026: a single city resident with net wealth of CHF 500,000, including CHF 190,000 of Indian units, pays wealth tax of CHF 637.70 before church tax, after Zurich's rounding. Without the units it is CHF 243.95, so they add CHF 393.75.
On the return
- Germany: declare on the return forms Anlage KAP-INV and Anlage KAP (2025 line numbers not verified). Indian tax, up to the treaty rate, is credited under section 32d(5), at most 25% of each item.
- Switzerland: list the units in the securities list; Form DA-1 claims credit if unrecoverable treaty-country tax tops CHF 100 in total.
- Germany also wants a notice of buying or selling foreign holdings at a 10% stake or over EUR 150,000 total cost; fund units are not settled. We found no FBAR-style form in either country; see EU rules and CRS.
Our checklist
The Berlin-to-Bern Record Sheet:
- Record scheme, plan, option and folio for each holding.
- Note each year's first and last price in rupees and euros or francs, and the rate source.
- Keep payouts, tax statements and the fund's equity share figures.
- Record the December 31 value for Swiss wealth tax.
Common questions
Does Germany tax a growth plan that pays nothing?
Yes, through the lump sum, if the price rose in the year. Amounts taxed reduce the gain when you sell.
Do I get the 30% exemption on an Indian equity fund?
Only if the fund terms meet the more than 50% equity test or you prove the share each year. Whether an Indian offer document counts is not settled.
Are Swiss sale gains always tax-free?
For a private investor, yes. Income is still taxed; a professional trader's gains are business income.
Official sources
- Investmentsteuergesetz (Investment Tax Act), Germany
- Einkommensteuergesetz section 32d (flat tax on capital income)
- Abgabenordnung section 138 (notice of foreign holdings)
- ESTV: Circular 25 on collective investments, Switzerland
- Fedlex: Federal Direct Tax Act (DBG)
- ESTV: Switzerland-India country sheet
- Income Tax Department, India: Germany agreement
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