Registering a company in Switzerland is the right move for entrepreneurs and investors as the country is famous for many traits and enjoys a very positive reputation.
You can easily start a business in Switzerland if you have a clear business idea, understand your prospective market, choose the most practical legal structure, and make other necessary arrangements.
Besides avoiding excessive bureaucracy, registering a company in Switzerland makes good economic sense if you aim to benefit from the country’s consistent political atmosphere, competitive economy, stable economic climate, and very transparent legal system.
What’s more, in Switzerland, there are no prohibitions to doing business, so anyone, including non-residents, can easily do business, set up companies, and generate financial income from them.
The process to register a company in Switzerland
To register a company in Switzerland, you need to deposit the authorized initial share capital into a bank account, prepare the corporate documents, and filled-out an application form. In general, setting up your company in Switzerland includes the following steps.
- Choose the suitable company type for your business and choose a distinctive company name to be reserved.
- Open a bank account in which you deposit the minimum share capital. Upon registration, the bank will make capital available in the business account.
- Prepare the necessary documents to facilitate the business registration. These documents include the memorandum and articles of association, certificate of incorporation as well as identification proofs of applicable parties and the company’s resolution of incorporation. These documents must be authenticated in the presence of a notary public.
- you have to sign the Stamp Declaration Form and the Lex Friedrich Declaration form and have them submitted to the Register of Commerce.
- To obtain the company’s legal entity, you must submit the articles of association to the Commercial Registry for registration. The registration fees will depend on the number of shareholders and notarized signatures,
- Next step is to pay stamp tax at the post office or bank and register the company for VAT.
The company can be incorporated in just 2 to 6 weeks, if the documents are properly submitted and if the minimum share capital is provided.
Legal structures in Switzerland
Choosing a suitable business structure is an important decision, as it impacts your legal and company taxes so you need to analyze your options carefully. Outline next are the main legal business structures in Switzerland:
- Sole proprietorship
The sole proprietorship is the most common type of company in Switzerland. It is suitable for professionals who work for themselves. It is also the easiest and cheapest way to start a business in Switzerland since it requires little to no capital and no mandatory annual taxes. The sole proprietorship is run by one individual who must be a Swiss resident.
The owner of sole proprietorships has unlimited liability and their name must be included in the company name. The company must also be registered with the Swiss Commercial Register if the annual income surpasses 100,000 CHF. Sole proprietorships can later change into LLCs but on certain conditions. .
Setting up a sole proprietorship is fairly straightforward.
- General partnership
A general partnership is legally comparable to a sole proprietorship. It is a business structure based on an alliance of two or more natural or legal persons. A general partnership doesn’t exist as a separate legal entity, so all partners have unlimited liability. general partnerships are not taxed as companies, so individual partners tax both their private and business income and assets altogether. Same with sole traders, all general partnership businesses need to enter the trade register. Also, the general partnership full accounts must be kept.
- Limited partnership
A limited partnership is an arrangement involving a minimum of two partners, where at least one has unlimited liability and at least one has limited liability. A limited partnership is a less common version of a general partnership, but all other legal requirements are the same. Start-up capital is not mandated for limited partnerships, but Chamber of Commerce registration is necessary. The limited partnership is commonly used if an unlimited business needs to raise extra capital.
- Swiss limited liability company (Gesellschaft mit beschränkter Haftung – GmbH)
The Swiss GmbH is another common company form in Switzerland. It is an independent legal entity that requires a minimum share capital of 20,000 CHF (cash or assets). It is a separate legal entity that requires at least one director and shareholder who is a Swiss resident. A Swiss GmbH had proven to be the better option for many entrepreneurs and small businesses since it does not mandate a board of directors. Under a Swiss GmbH, all shareholders are jointly liable for company debts up to the registered capital amount. Also, the founders have the right to execute the duties of the governing bodies.
- Stock corporation (Aktiengesellschaft – AG)
The Swiss corporation is the most popular form of business in Switzerland, where the corporation is an independent legal entity. The Swiss corporation needs to have at least one director and one shareholder who is a Swiss resident. An advantage of registering a Swiss corporation as a holding company in Switzerland is the several tax cuts implemented by both the cantonal and federal governments.
The liability of the Swiss corporation is limited to its assets, and the minimum amount of share capital to start up is CHF 100,000, of which 20% must be paid upfront. The company must acknowledge formal incorporation and registration procedures. For the Swiss corporation, it is mandatory to appoint an auditor.
You can also choose to expand into Switzerland by opening up a branch or subsidiary.
The list of the required documents to be submitted to register a company in Switzerland
Residents and non-residents can set up shop in Switzerland. But, only those that meet specific requirements have a legal right to start a business.
In addition to the passport of the beneficiary and a B Permit, the following documents are necessary to register a business in Switzerland:
- business plan
- professional and commercial registry entry.
- statement of a valid bank account
- Social insurance proof for self-employed persons.
- reference to the social insurance (this is for self-employed persons), and
- VAT number.
If you are a citizen of the European Union and/or the European Free Trade Association (EU/EFTA), you have an advantage owing to the Agreement of Free Movement of Persons. So starting a business in Switzerland will not be as difficult. But if you come from a country outside of the EU or EFTA, starting a business in Switzerland may not be as easy. You might also be asked for some unique requirements, including obtaining a specific permit and measuring up to specific law standards.
The process of opening a company in Switzerland might be tiring but you can skip the elaborate process, by letting a professional handle your company formation in Switzerland.
In other words, let’s go ahead and contact your Damalion expert now for your company formation in Switzerland.
