Switzerland is well known as the heart of the global trade center. It is the most attractive countries for investors from around the world to do business. Switzerland is an excellent strategic location within the center of Europe. It has a well-developed infrastructure with a stable political and economic environment.
Switzerland has ranked as 4th in the world under the Heritage Foundation Index 2017. Besides the most important thing is that it has comparatively low Personal and Corporate taxation system. This taxation system provides a comfortable and appealing business environment for foreign investors. So, opening a company in Switzerland will be beneficial to them in many ways. Before a company registration, it’s important to choose which type of business structure it will be.
The following are the most common legal entities of Switzerland that investors can choose from:
- Limited liability companies (LLC)
- Limited Partnership (LLP)
- Public Limited Company
- Representative Office
- Branch Office
|Basic Requirements||LLC||LLP||Public Limited Company||Representative Office||Branch Office|
|Require resident director/manager/partner/legal representative||YES||YES||YES||YES||YES|
|Minimum number of directors||1||1||3||1||1|
|Minimum number of shareholders||1||1||1||Parent Company||Parent Company|
|Least paid up share capital (EUR)||18,500||18,500||91,500||1||1|
|Time to incorporate||1 month||1 month||1 month|
If any foreign or local investors want to open a company in Switzerland, they will need to complete all the following steps of incorporation:
Choosing a name for the company
The foreign or local investors will need to select a proper company name before they can open a company in Switzerland. They can check the existing list of federal registries of all company to reduce the possibility of denying the name. The chosen name has to approve in an official way before the registration of the company. Moreover:
- The chosen name must not be the same as any other registered company’s name.
- The legal status of the company name must have to present.
Becoming an Independent or partnership
He or she can open and register an independent company or also open a partnership business or company if they decide to work together.
- Can add a trading name.
- No setup documents are required.
- CHF 120- is the base registration fee (decided by the federal government).
- Requires a partnership agreement which needs to be put together with a notary.
- Required base registration fee is CHF 230-240.
- Demanded Notary fees are to be between CHF 999 and CHF 3,000.
Required Documents for company registration in Switzerland
To register a company in Switzerland, the investors must provide important legal documents to the registrar. The documents are:
- Verified photocopy of AoA (Articles of Association)
- Notarized/apostille power of attorney.
- Each board member’s sample signature (Notarized).
- Photocopy of the MoA (Memorandum of Association).
- Declaration to reject the yearly audit.
- Customer Due Diligence Form.
- A rental contract for an office.
- Lex Friedrich Declaration Form.
- Application need to be summit to the commercial register.
- Directors and shareholders ID or passport copy.
The new company needs to submit the correct documents for easy company registration in Switzerland. The company formation can be complete in about three weeks if the investors successfully provide the least share capital.
Opening a Bank Account
The company formation process in Switzerland starts with the opening of a bank account. After placing the paid-up capital, the bank will issue a receipt for the amount to register the company.
- Bank fees are about CHF 200 to CHF 2000.
- Requires the draft of the company’s articles of association with the public notary.
- All the documents need to authenticate and registration applications form has to fill out.
- Need to send the Stamp and the Lex Friedrich Declaration form to the Register of Commerce.
- Registration costs vary from CHF 600 to CH 10000.
- The process of application will take between 5 to 9 days.
Banking Considerations in Switzerland
|Multi-currency bank accounts available||YES|
|Feature of e-banking platform||Excellent|
|Crowd funding possible||YES|
|Corporate visa debit cards accessible||YES|
Depositing least share capital
- 50 CHF is the minimum paid-up capital for a Swiss AG and 20 CHF for a Swiss GMBH.
- The founders of a stock corporation need to provide least CHF 100,000.
- Required to audit the accounts every year (all companies with 10 or more employees).
Formalities after Swiss Company Incorporation
The investors need to register for VAT and for taxation purposes after obtaining incorporation certificate from Swiss Companies Register. Some company needs to get special licenses or permits. Then the last step that is to register the employees for social security and insurance.
- This applies to those businesses that generates more than CHF 100,000 or more in a year.
- This application of VAT registration will need to do with the Federal Tax Administration after company registration.
- CHF 100 000 is the least revenue for VAT registration.
- Three types of tax are available: federal, communal (municipal) and cantonal.
- The common one across the world is Federal tax.
- Depending on where the company is based, Cantonal and communal taxes may change significantly.
Employees Enrollment into the Social Insurance System
- The Cantonal Social Security Office will send an application for listing employees in the insurance system.
- These systems include industrial accidents, pension, and survivors’ benefits.
- Retirement schemes and disabilities are also covered by the system.
- Trademark costs CHF 550.
- The trademark registration process can be done via the IGE online portal.
- Ensure no one else is using the trade name for the alike product or service.
|Benefits of Company Incorporation||Problems of Company Incorporation|
|Easy company set up processes||No limit to debt|
|Huge reputation for legal security and long-term stability||Starting company is comparatively expensive|
|Stable, friendly and anticipated political environment and taxation system||Difficult to secure residence visas for non-EU citizens|
Compared to other major EU countries it’s much easier to set up and register a company in Switzerland. It has a fair bureaucracy scheme with a reasonable taxation system. So, the investors can enjoy a pro-business environment with various tax incentives and high labor force.