Switzerland company registration

Switzerland company registration

DOING BUSINESS IN SWITZERLAND

Since 2013, Healy Consultants has successfully assisted our Clients with starting a company in Switzerland. Our firm’s services include i) Switzerland busines registration ii) corporate bank account opening services iii) office space rental solutions iv) recruitment services v) employment visa services and vi) accounting and bookkeeping services.

SummaryLLCFast solutionPLCBranch companyRep officeHolding companyCharitable Foundation
Best use of company?Trading companyTrading companyTrading companyConsolidated statementsMarketing and researchIP holdingCharitable activities
Legally tax exempt if properly structured?NoNoNoNoYesNoYes
Corporate bank account location?UBSCIMCredit SuisseLombard OdierBNP ParibasRaiffeisenAIG
Client must travel to Switzerland?NoNoNoNoNoNoNo
Can secure trade finance?YesYesYesYesNoYesNo
Limited liability entity?YesYesYesNoNoYesYes
VAT payable on sales to local customersYesYesYesYesNoNoNo
Withholding tax on payments to overseas shareholders?YesYesYesYesNoNoNo
Average total engagement costs?€18,650€20,550€21,640€20,300€20,300€18,650€29,190
Average total engagement period?12 weeks8 weeks12 weeks11 weeks11 weeks12 weeks12 weeks
Accounting and tax considerationsLLCFast solutionPLCBranch companyRep officeHolding companyCharitable Foundation
Statutory corporation tax payable at federal level?8.5%8.5%8.5%8.5%0%8.5%1%
Statutory corporation tax payable at cantonal level?VariableVariableVariableVariable0%Up to 0%0%
Average corporation tax payable18.4%18.4%18.4%18.4%0%12%0%
Must file an annual Switzerland tax return?YesYesYesYesNoYesNo
Effective corporation tax rate on net profits of US$250,000?8.5%+ cantonal tax8.5%+ cantonal tax8.5%+ cantonal tax8.5%+ cantonal tax0%7.8%0%
Must file annual financial statements?YesYesYesYesNoYesNo
Investment income is legally tax exempt in Switzerland?NoNoNoNoNoYesYes
Access to double taxation treaties?YesYesYesYesNoYesNo
This entity enjoys Government incentives?YesYesYesYesNoNoNo
Quarterly VAT reporting to the Government?YesYesYesYesYesNoNo
Legally tax exempt entity?NoNoNoNoYesNoYes
Dividends received are legally tax exempt?NoNoNoNoNoYesYes
VAT payable on sales to local customers8%8%8%8%0%0%0%
Withholding tax on payments to parent company?35%35%35%0%0%0%0%
Company registrationLLCFast solutionPLCBranch companyRep officeHolding companyCharitable Foundation
Withholding tax on payments to parent company?YesYesYesYesYesYesYes
Minimum number of shareholders\partners?1111111
Minimum number of directors\managers?1131111
Minimum paid up share capital?€18,500€18,500€91,500€1€1€18,500€46,000
Shelf companies available?YesYesYesNoNoYesNo
Time to incorporate a new entity?3 weeks1 week4 weeks4 weeks4 weeks3 weeks3 weeks
Can easily convert to a local PLC company?YesYesNoNoNoYesNo
Can have preference shareholders ?YesYesYesNoNoYesNo
Business considerationsLLCFast solutionPLCBranch companyRep officeHolding companyCharitable Foundation
Can invoice local customers?YesYesYesYesNoNoNo
Can hire local staff?YesYesYesYesYesYesNo
Can rent local office space?YesYesYesYesYesYesYes
Secures a residence visa for business owner?YesYesYesYesYesYesNo
Good entity for trademark registration?YesYesYesNoNoYesYes
Other useful informationLLCFast solutionPLCBranch companyRep officeHolding companyCharitable Foundation

Singapore has signed free trade agreements?Yes, see this page
This country is a member of WIPO and TRIPS?Yes
The country is a member of the ICSID?Yes
Average custom duties suffered?5.5%
Government foreign investment approval is required?No
Average monthly office rental? (US$ per sq m)42
Minimum statutory monthly salary?4,200
Average monthly US$ salary for local employees?7,000
Swiss Franc deposit interest rate? (1 year average)0.01%
US$ deposit interest rate? (1 year average)0%
Overseas remittance currency controls?No
Public register of shareholders and directors?Yes

Banking considerationsLLCFast solutionPLCBranch companyRep officeHolding companyCharitable Foundation
Multi-currency bank accounts available?YesYesYesYesYesYesYes
Corporate visa debit cards available?YesNoNoNoNoNoNo
Quality of e-banking platform?ExcellentGoodGoodSatisfactoryExcellentGoodGood

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  • Benefits and problems

    Benefits of Switzerland company registration

    Our Clients can register a limited liability company in Switzerland with a minimum of i) one shareholder and ii) one director of any nationality. The minimum paid-up capital required is CHF20,000. The incorporation procedures can be completed within four weeks and do not require our Clients to travel;

    1. Switzerland is a great place to form a holding company, because:
        Switzerland business registration advantages and disadvantages

      • A holding company registered in Switzerland can benefit from exemption from communal corporate tax if i) the company’s operations only consists in managing long term investments and either ii) equity investments of the holding company represent over 66% of its total assets or iii) the income generated by such investments represent over 66% of the company’s annual income;
      • Dividends received from both resident and nonresidents subsidiaries can be furthermore exempt from federal income tax, provided that the investment of the holding company represents either over i) CHF 1 million or ii) over 10% of the total capital of the companies distributing dividends;
      • Sales of shares are also exempt from capital gains tax, provided that such shares i) have been held for more than one year and ii) represent over 10% of the total share capital of the subsidiary;
      • Swiss companies can also qualify for “domiciliary company status” allowing them to benefit from reduced corporate tax rates of up to 8.5%, provided over 80% of their sales and costs are generated outside of the country;
      • Our Clients forming a holding company in Switzerland will also enjoy benefits granted by the EU’s parent company directive, waiving withholding tax on dividends and interest received from EU subsidiaries. They will also benefit from the country’s 90 double taxation avoidance agreements signed with countries including: i) China ii) India iii) Hong Kong iv) Singapore v) Australia vi) the United States and vii) the United Arab Emirates.

    2. Switzerland is a low tax country in Europe, because:
      • Total corporate tax rate paid by a Swiss (non-holding) company can get as low as 12.5%. According to their place o registration, local companies are indeed subject to corporate tax paid i) to the federal authorities at a uniform 8.5% and ii) at the cantonal and communal levels, at variable rates which are at their lowest in the Cantons of i) Lucerne ii) Zug iii) Obwalden iv) Nidwalden v) Appenzell Auser-Rhoden and vi) Appenzel Inner-Rhoden;
      • Switzerland has the lowest VAT rate (8%) in Europe. Companies are not required to register if their annual turnover is below CHF100,000;
      • Employers’ social contributions are also represent only approximately 5.5% of their employees’ gross salaries, one of the lowest proportions within European countries.

    3. Switzerland has a very business friendly government, because:
      • Manufacturing firms investing in Switzerland’s structurally weak regions of can enjoy 50% to 100% tax rebates on both federal and cantonal level. For example, a pharmaceutical firm setting up in the Berne canton will be granted a tax fee status for 10 years;
      • If certain conditions are met, a newly registered business in Switzerland can i) receive loans from the government worth US$550,000 or ii) allow the Swiss Government to act as a guarantor for up to 65% of banks loans;
      • Government programs like the Blue Lion Initiative and Technopark offer new firms a chance to showcase their business ideas before experts in related fields and get free expert advice.
      • Entrepreneurs looking for a fast turnkey solution can buy a ready-made Switzerland company with corporate bank account already approved.

    Problems with Switzerland company registration

    1. At least one director of the company must be a Swiss citizen or a Swiss resident. If needed, Healy Consultants can assist our Clients to find a resident director in Switzerland, who will play no independent part in management decision making;
    2. Starting a company in Switzerland is expensive, because:
      • Minimum paid up share capital for an LLC is CHF20,000;
      • Annual government fees for incorporation are €1,850;
      • Purchasing employee health insurance is mandatory; increasing labor costs as Swiss insurance costs are the 3rd highest in the world;
      • A Switzerland resident firm with more than 10 full-time annual employees must get its financial statements audited.

    3. It is difficult for non-EU citizens to secure residence visas following Switzerland business registration because:
      • Only EU citizens can obtain a Switzerland entrepreneur work visa for self-employment. For instance, a USA citizen must have lived and worked in Switzerland for 5 years before he/she could be self-employed;
      • Non-EU nationals are granted employment visas based on a quota system for their country. Entry will also be based on the worker’s qualifications.

  • Best uses for a Switzerland company

    1. Business registration in Switzerland is ideal for R&D & high value added manufacturing operations, because:

    2. Switzerland is the best European distribution center, because:
      • Switzerland has the world’s 6th highest rated infrastructure including high quality airports, rail and road services which facilitate easy transfer of goods;
      • The Swiss-EU-Free Trade Agreements (FTAs) offers the following benefits to Switzerland resident companies: i) duty-free trade of goods/services ii) free movement of capital and labor and iii) easy access to an integrated European consumer base of 500 million;
      • Switzerland operates free zones and bonded warehouses in Geneva, Zurich, Basel and Chiasso. Foreign goods can be stored there without incurring duties for an unlimited time period.

Company registration

  • Time to incorporate: Four weeks
  • Cost to set up: € 18,650
  • Minimum capital: CHF20,000
  • Physical office required: Yes

Required appointments

  • Shareholders: 1
  • Directors: 1
  • Company secretary: No
  • Resident director: Yes

Key facts

  • Corporate tax rate: 12.5%
  • Corporate tax base: Worldwide
  • Shelf companies: Unavailable
  • Main company type: GmbH

Frequently asked questions

Contact us

For additional information on our company registration services in Switzerland, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Simon Guidecoq, directly:
client relationship officer - Simon