going back to corp bonds where it seems the whole coupon value is taxed here wouldnt that mean people only buy them right after the annual maturity date (all other things being equal) since they wont get tax relief on the accrued interest part if purchased somewhere in between?
I think the price of the bond generally factors all this in. In ideal efficient markets, buyer is not going to buy anything that is not compensating for everything
Tax treatment is different for professional investors, though. I would suspect the market to be less efficient for private investors where bond interest is taxed but actual capital gain/loss is irrelevant for tax purposes.
Do you know any Bonds or Mutual Funds where you earn solely on appreciation of a face value (you buy bond with discount to the face value).
I am looking for something similar to US T-Bills but denominated in Swiss Francs. The reason is to avoid taxation.
The currency will not change the taxation if the instrument has a similar payoff
Arenât zero coupon bonds taxed in Switzerland anyway ?
I am asking about Swiss Francs instrument, not to avoid taxation, but to diversify portfolio.
OK interesting. Why would they?
Because itâs the law.
Zero coupon bonds are taxed, as if they would pay a coupon.
Interesting conversation. What about Zero-Coupon Bonds ETF? Would it be taxed as stocks or bonds?
The best way to check is ICTAX database
Thatâs not what you wrote in your first message:
As mentioned by other users, zero bonds are taxable in Switzerland. The gain is considered as interest income.
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You can buy money market funds, they tend to have a lot of ZERO coupon bonds. But as mentioned earlier, ZERO coupon bonds are not taxed as Normal bonds.