Entrepreneurs and legal entities that are interested in Swiss company formation, should know that the legal framework is constantly changing because of the strong connections Switzerland has with the EU as well with other industrialized countries due to the double taxation treaties and various tax information exchange treaties that were concluded.
Therefore, here some generalities about the Swiss company formation process, but, it is recommended to request expert advice from a specialized firm for further information.
In Switzerland, forming a company and starting your own business is relatively simple. Before starting the procedure of Swiss company formation, some essential steps are necessary.
Among these steps, the most important are:
- Market analysis;
- Drawing up a business plan;
- Choosing a business structure to carry out the appropriate activity;
- Registration in Swiss Commercial Register.
As Switzerland has a federal structure, the fiscal system is not centralized. Some taxes are levied only on federal level, while other taxes are levied on federal, cantonal and communal level. The tax rate levied at federal level is fixed, but the tax rate levied at cantonal level varies, depending on the tax rates established by each canton.
Tax rates levied at cantonal level are significantly different, which is why choosing the best canton for Swiss company formation is an important element in the international tax planning activity.
The most common legal form in Switzerland is the AG (Aktiengesellschaft).
Limited Liability Company (Swiss GmbH)
In order to set up a GmbH, it is necessary to have at least one or more individuals or legal entities to found the company.
The GmbH may also have a single individual or legal associate, in this case being a Swiss GmbH with a single associate.
If the company shareholders want to remain anonymous, they may do so under certain conditions and being represented by others (usually a Swiss resident).
The minimum share capital for setting up a Swiss GmbH is 20,000 CHF.
Starting with July 1, 2015, all Swiss GmbHs must be represented by a person residing in Switzerland.
Joint Stock Company (AG)
This type of business structure is preferred by large-scale business entrepreneurs, unlike small and medium-sized businesses, who prefer the business structure of a GmbH.
The minimum required share capital to set up a Swiss AG is 100,000 CHF.
Swiss companies can be set up to conduct trading, real estate investment, intermediation of any kind, to be used as holding companies, management and advisory services, financial and commercial transactions, and all sorts of other activities under Swiss law. Statutes define in detail the social purpose, the social capital and the ways in which the company carries out its activity. It is worth mentioning that for anonymous societies (AGs) most members of the Administrative Council must have a Swiss passport and reside in Switzerland. Alternatively, European citizens with stable residence in Switzerland are admitted.
For this reason, foreign clients generally entrust the task of representing them on the board of directors to commercial consultants, lawyers, and other trusted persons. As for the Limited Liability Company (GmbH), it is sufficient for one of the administrators to be resident in Switzerland, even as a foreign citizen. A firm specialized in Swiss company formation is able to find the appropriate person to act as the company’s director, guaranteeing the actual owner of the company, control over the management of their company.
The use of third parties (lawyers, commercial consultants, trusted persons) as managers of Swiss companies also allows the company’s owner to protect its anonymity because it the name of the owner remains anonymous in public records.