Switzerland has paid the UK tax authorities £258m in unpaid taxes on undisclosed assets following the first tranche specified under the UK-Switzerland tax agreement.

This is the first transfer of funds made by the Swiss Federal Tax Administration (FTA) with further payments expected in the coming months.

As an alternative to paying the withholding tax, UK taxpayers with a bank account or securities deposit in Switzerland were given the option to disclose their account details to HMRC.

The UK/Swiss Tax agreement came into force on 1 January 2013 to address the issue of non-UK-tax-compliant assets held or managed in Switzerland.

This marks the start of the regularisation of so-called legacy assets. The on-going annual withholding tax levy, in respect of future periods from 1 January 2013, extends only to income tax and capital gains tax. Again, the withholding tax will not apply if the account-holder authorises disclosure of details of income and gains to HMRC and pays any associated taxes in the UK.

From end-July 2013 until June 2014, the FTA will remit the outstanding tax to HMRC on a monthly basis. Withholding tax on capital income generated on bank accounts or securities deposits after the entry into force of the agreement will be forwarded from 2014 onwards.

More details are available from the FTA HERE