The repayment of foreign taxes on a Swiss resident's pension

Generally, a Swiss resident taxpayer who receives pension income provided by Italian social security institutions incurs a withholding tax with subsequent burden of claiming a refund. The refund request involves the submission of an application to the ItalianTax Office, accompanied only by documentation proving Swiss tax residence. Instead, refund requests are often denied because the Italian Tax Office deems the documentation on residence insufficient, wanting to enter, for each case, into the merits of the concrete Swiss taxation of the recipient, while such an in-depth examination should not be carried out in deference to the provisions of Article 29 of the Convention against double taxation in existence between the two states.

Therefore, the Supreme Court Order No. 30779 of November 6, 2023, which confirmed the validity of a taxpayer's claim for refund accompanied by the official certificate of tax residence issued by the Swiss tax authority, without the need for further detailed information on the actual taxation in the state of residence, being according to the Convention the exclusive taxing power of the Swiss state, is to be welcomed.

The certificate of tax residence, under the terms of the Convention, issued by the foreign authorities is therefore sufficient to claim a refund of foreign withholding taxes on the pension. On the other hand, it is different in the case of other incomes whose tax competence lies with both states and therefore require a greater amount of documentation with timely verification of the final taxation on the recipient.

Our staff remains available for clarification.