Business Registration in Switzerland
Economy and Infrastructure
Switzerland has a prosperous and stable modern economy with a per capita income approximately 10% higher than in other Western European countries.
The Swiss have a highly developed telecommunications system that offers state-of-the-art telephone, fax, telex and Internet connections as well as courier services. Swissair, the national air carrier, offers direct flights to many cities world-wide, and domestic air travel is excellent, offering frequent services to most cities.
Switzerland is the world’s largest offshore private banking centre, with the Big Two banks, Credit Suisse and UBS, and a plethora of private banks, handling one-third of the world’s offshore private wealth.
For private investors, Switzerland’s banks, based in the cities of Zurich, Basle and Geneva, offer a safe and mainly conservative approach to investing, backed by political stability and strong banking secrecy practices.
Most Swiss banks have a well-diversified range of Swiss and Luxembourg-based mutual funds that are available worldwide to private investors, along with a range of discretionary portfolio management services and banking facilities.
The currency is the Swiss Franc (SF). There are no exchange controls.
In Switzerland there are the two types of company used for international trade and investment:
- Aktiengesellschaft (AG) – Stock Company;
- Gesellschaft mit beschrankter Haftung (GmbH) – Limited Liability Company.
A company incorporated in Switzerland is subject to restrictions on the following trading and business activities, which cannot be undertaken without a special license or consent: banking, insurance, assurance, reinsurance, fund management, collective investment schemes, or any other activity that suggests an association with the banking or finance industries.
The language of legislation and corporate documentation is any Swiss official language (German, French, Italian or Romansch), but foreign language translations can be obtained. A company incorporated in Switzerland has the same powers as a natural person.
A registered office must be maintained in the canton of incorporation. Owing to the costs associated with incorporation and paid up share capital requirements, off-the-shelf companies are not available.
The names of companies being incorporated are subject to the following requirements and restrictions:
- The name of a body corporate or trust entity may be in any language that uses the Latin alphabet, but the Public Registry may require a translation into any official Swiss language;
- A name that is identical or similar to an existing name is unacceptable;
- A name that may imply government patronage is not permitted;
- Any name that in the opinion of the Registrar may be considered undesirable is restricted;
- If the Company name includes such words as Bank, Building Society, Savings, Insurance, Assurance, Reinsurance, Fund Management, Investment Fund, Switzerland, State, Country, Municipality, Principality, Red Cross or their foreign language equivalents, then consent or a license are required;
- The following suffixes are used to denote limited liability: Aktiengesellschaft or AG; Gesellschaft mit beschrankter Haftung or GmbH.
A minimum of one director/manager who must be a Swiss citizen and resident in Switzerland must be appointed. If more than one is appointed the majority must be Swiss citizens and resident in Switzerland. Corporate directors are not permitted. If required, we can provide service of professional Director. Fee for the service will depends on particular type of company business and turnover and will start from about $9500 per year.
There is no requirement under Swiss Law for a company secretary to be appointed. The minimum number of shareholders depends on the type of Company: for an AG the minimum number of shareholders is three, while for a GmbH it is two.
The minimum required authorized capital depend on the type of Company:
AG: This type of company has a minimum authorized capital of SFr 100,000, which has to be fully paid and deposited to special account prior incorporation. When the share capital exceeds SFr 250,000 a capital duty of 1% is payable on the amount over SFr 250,000.
GmbH: The minimum authorized capital is SFr 20,000 but the company does not have shares, instead, the owners’ share stake is registered in the Commercial Register. SFr 10,000 must be paid up on incorporation.
The following classes of shares are permitted, depending on the type of Company:
- AG: Registered shares, bearer shares and preference shares.
- GmbH: Registered shares only. Bearer shares are not permitted.
Annual Taxation and Fees
Switzerland’s 26 cantons each have their own taxation system. The cantons have preserved many of the rights they held as sovereign political entities. Nevertheless, the constitution delegates considerable authority to the Federal Government, including the power to conclude treaties and alliances, to levy taxes and to regulate foreign trade. There are many cantons with favorable taxation levels and some cantons with higher unemployment rates or small populations (in mountain regions) have particularly low levels of taxation. Attractive taxation for domicile (main activity outside Switzerland) and holding Swiss companies. Domicile and holding companies, particularly in Canton Bern, are exempt from cantonal tax on profit, paying only Federal Tax on profit of appr. 8% and a maximum tax of approximately 0.4% on the capital. Further individual tax rulings for clients may be negotiated and arranged with the State Tax authorities in Bern.
There are double tax agreements with Australia, Austria, Belgium, Brazil, Canada, Denmark, Egypt, Finland, France, Germany, Great Britain, Greece, Hungary, Iceland, Indonesia, Ireland, Italy, Japan, Malaysia, the Netherlands, New Zealand, Norway, Pakistan, Portugal, Singapore, South Africa, South Korea, Spain, Sri Lanka, Sweden, Trinidad and Tobago and the USA.
There are no license fees in Switzerland.
Companies are required to keep financial records. Although there is no requirement to file financial statements with the Registry, they must be presented to the shareholders and filed with the tax authorities.
Residence permit in Swtizerland
Switzerland is one of the most attractive countries in the world, with high quality of life, stabile political and economic situation, excellent environment and privileged taxation.
Our Swiss based consultants can assist private clients, foreign investors and business people with obtaining Swiss residency, establishing operational structures in Switzerland, including legal and corporate consulting, tax consulting, back office support and related services. We also can assist with tax ruling negotiations for obtaining Privileged taxation for foreign investors and domicile (main activity outside Switzerland) companies, as well as and for foreign private individuals, who do not actively work in Switzerland, but may manage his international investments and has business activity outside Switzerland.
It is much easier for citizens of European Union to obtain the Residence Permit in Switzerland. Non – EU citizens may obtain a residence Permit in the following 3 cases:
- As retire with close relationship to Switzerland or as financially independent person, paying the agreed amount of annual tax based on individual tax ruling with the Swiss Tax authorities;
- As person, employed by Swiss Company, if Swiss employer can prove that no suitable candidate can be found in Switzerland and EU labor markets;
- If foreign person establishes a Swiss Company and will be employed by his company in a senior position of CEO and will create jobs for Swiss residents.
Our consultants will help with:
- Preparation application for each individual case and negotiating individual Swiss Tax ruling for EU and non – EU citizens;
- Obtaining work Permits B for key employees of Swiss companies, foreign investors in Switzerland, foreign business clients;
- Establishing working Swiss Companies and structures, including Tax and structure planning;
- Preparing applications and obtaining of annual renewals of Residence and work Permits B;
- Annual accounting, and will provide secretarial and administration assistance;
- Obtaining private and corporate tax consulting and planning, individual Tax ruling with Swiss Tax authorities, negotiating most favorable lump sum tax arrangement, so called flat tax, for the client;
- Obtaining a written flat tax approval from the Cantonal Tax authority for each client;
- Searching for suitable property (residence or business investment: office building, ect.) in Switzerland;
- Negotiating, purchase and sale of Swiss properties (private and business);
- Related business services for the client.