Switzerland is a neutral confederal republic in Western Europe. Switzerland is among the top ten world countries in terms of economic competitiveness.
Benefits of registering a company in Switzerland
Switzerland has the following advantages when registering a company:
- the prestige of the country (more than 40% of world capital is concentrated directly in Switzerland);
- skilled and competent workforce;
- the country’s authority in the world financial arena;
- political and economic stability;
- reliable service sector;
- the confidentiality of banks attracts foreign capital;
- promoting innovations in world markets;
- investment attractiveness;
- agreements signed with other countries for the avoidance of double taxation;
- Switzerland is not on the FATF and OECD lists;
- banking secrecy;
- favorable legal conditions for registering a company in Switzerland;
- there is no currency control;
- Switzerland has one of the lowest crime rates.
Company registration procedure in Switzerland
Registration of a company in Switzerland is carried out as follows:
- The name of the enterprise is formed;
- An agreement is signed between the founders;
- A bank account is opened, and funds are deposited;
- Documents are submitted for entry into the register of companies.
Also, to open a business in the territory of this jurisdiction, legal entities must adhere to the following rules:
- The company must have a registered office in Switzerland;
- The minimum authorized capital is 100 thousand CHF;
- Minimum number of directors and shareholders: 1;
- The director must have resident status.
Anyone can open a company in Switzerland. It is a country that is attractive for business. It stands out among the developed countries, such as Great Britain, France, Italy, and Germany.
Types of companies (forms) in Switzerland
In Switzerland, there are two main forms of business for non-residents:
Limited liability company (GmbH) is the most popular type of business in Switzerland for small and medium-sized companies. A joint-stock company (AG) is the most commonly used business model for large companies.
Limited Liability Company (GmbH) – as the name suggests, those who own a limited liability company only risk the capital they have invested; their assets are not at risk if the company goes bankrupt.
The minimum share capital required to register a limited liability company is at least CHF 20,000 (18,100 euros). Also, you will need to specify the partner as the founder and the executive director – a signature manager in Switzerland. At least one of the executive directors must live in Switzerland. To simplify matters, the founding shareholder and the executive director may by law be the same person.
A joint-stock company (AG) is the most popular model for large companies in Switzerland and the most commonly used business structure for financial companies.
To register a joint-stock company (AG) in Switzerland, you need to have a minimum share capital of at least CHF 100,000 (90,900). Also, you need to have at least one person on the board of directors and one shareholder. Technically, these two positions can be occupied by the same person. It is important to know that most of the board members who are authorized to sign must live in Switzerland.
Unlike a limited liability company, investors in a Swiss joint-stock company can maintain their anonymity. The only drawback when opening a joint-stock company is that the minimum authorized capital is quite large.
The statutory fund can be disposed of and spent immediately after the creation of the company.
Switzerland is one of the few countries that provide the option of depositing share capital in cryptocurrency.
Documents required to open a company in Switzerland
Registration of a Swiss company is not a complicated process. For this, you will need:
- Notarized translation of the internal passport;
- Passport notarized;
- Your bank reference and C.
Also, an important nuance is the contribution of the authorized capital of the company. For this, a technical account will be opened in Switzerland.
Taxation in Switzerland
Switzerland has a progressive scale of taxation. Depending on the canton, the tax can range from 12% to 16%. In the case of holding activities, the corporate tax rate can be reduced to 4%. In 2018, a massive tax reform began in Switzerland, as a result of which the corporate tax rate for non-residents was decided to equal the rate for residents.
The most tax-loyal cantons in 2019 are:
- Basel, this year for the first time topped the rating, having risen by 8 positions, the corporate tax rate is 13.04%.
- In second place is Zug, which this year yielded the palm to Basel, the corporate tax rate is 13.5%, it is planned to decrease it to 12%.
- The third place is the canton of Geneva, the corporate tax rate is 13.99%.
- VAT – no VAT when working with EU countries;
- Capital gains tax – none;
- Stamp duty – none;
- Foreign exchange control is not.
Reporting for companies in Switzerland
The tax year for Swiss companies corresponds to the reporting period of the company.
All companies, without exception, are obliged to keep accounting records in francs and keep them in the registered office of the company.
Companies such as GmbH and AG are required to file P&L financial statements annually. Reporting is not publicly available and is prepared under international standards (Swiss GAP, IFRS, FER).
Audit requirements depend on the size of the company and the type of its activities. A standard audit covers companies that conduct securities activities, companies that are required to prepare free financial statements, or companies that meet two of three criteria:
- Annual turnover of 20 million CHF (18 million euros);
- The total assets of the company are more than 10 million CHF (9 million euros);
- More than 50 employees.
If the company does not advise the criteria above, it has the right to file an incomplete audit. Full exemption is possible only with the consent of the shareholders and on the condition that the company employs fewer than 10 people.