Louis, a French citizen, wants to loan money to a related USentity that will be purchasing real estate in Boca. If he sets up aFrench company, then the interest income will be taxed at a highrate. He hears that Switzerland taxes interest at a very low rate.So, he sets up a Swiss company which in turn loans the money to theBoca entity.
What is the withholding rate on interest and dividends under theUS-Swiss treaty? What's the rate under the US-France income taxtreaty?
Can Louis take advantage of the US-Swiss treaty?
You may want to take a look at the Treasury Technicalexplanation that can be accessed at the beginning of every articlein the treaty.
