Switzerland is a unique European state that has managed to achieve prosperity despite the absolute scarcity of minerals and other resources. Switzerland has a unique economic and political structure: being isolated and independent from what is happening in Europe, Switzerland enjoys many opportunities and advantages of the EU member states, since it has bilateral treaties with the European Union concerning many economic issues. To have your own company in Switzerland, you can register a new company, open a subsidiary or branch of an existing one, or buy a ready-made company.
Benefits of opening a subsidiary in Switzerland
Below are 4 reasons to register a subsidiary in Switzerland.
The ability to quickly issue a residence permit in Switzerland
For almost 25 years, Switzerland has provided an opportunity for foreign business persons who wish to implement unique projects to quickly obtain a residence permit. It only takes three months to get a residence permit for your entire family in one of the most economically stable and secure countries in the world. There is one condition: investing in this business at least 1 million euros. The amount is impressive, but living in Switzerland and having a residence permit gives access to many advantages.
Favorable tax conditions
The tax system in Switzerland is very favorable and, despite its peculiarities in each region, it is quite simple. So, the income tax is influenced by the amount of income of individuals, and usually, it ranges from 8% to 18%.
Corporations pay income taxes (3.63% to 9.8%), turnover taxes (6.2-9.3%), corporate income tax (1.5% to 10%). The share capital is also taxed (0.825%), and the VAT rate is 7.6%. By the way, if the company’s annual income is below 100 thousand francs, it is exempt from taxes.
There are only two types of companies
In this country, there are only two options for registering legal entities:
1. As a joint-stock company (LTD, AG, SA: authorized capital of 100 thousand francs). It has an advantage in financing and signing major contracts.
2. As a limited liability company (SARL, GmbH, LLC: 20 thousand francs). It provides for a simpler and more budgetary opening procedure, as well as more favorable administration in terms of price, due to which it is in great demand among medium and small businesses.
Uncomplicated working conditions
The working conditions of the company in Switzerland are quite simple:
The company is managed by three bodies: the general meeting of shareholders, the board of directors, and auditors.
The meeting must be held only once a year, no later than six months after the end of the financial year.
The board of directors should be composed of one or more members, who do not have to be shareholders.
At least one person from the entire management must reside in Switzerland (have a residence permit).
Auditors are selected at a meeting of shareholders (they can be both individuals and legal entities).
Subsidiary company in Switzerland
According to Swiss law, any foreign company has the right to open a subsidiary in the Swiss Confederation.
Subsidiaries are created when it is necessary to expand the activities of the main company. This company can only operate under the leadership of the parent company. Since the subsidiary was created at the expense of the parent company, or the agreement states that the subsidiary is subordinate to the parent company. Therefore, the subsidiary is not responsible for the actions of the parent company. The parent company is responsible for the subsidiary to the state and its regulatory authorities since it manages its activities.
How to register a subsidiary in Switzerland
The subsidiary is usually incorporated as a GmbH or AG. The process is similar for both types of companies. You do not need a special permit to carry out work in this form of business. However, it is required to register a new subsidiary in the Swiss Register. Subsidiaries in Switzerland are formed as limited liability companies, and they can be public or private, depending on their type – GmbH or AG. At least two shareholders with a minimum deposit of 20,000 Swiss francs in a Swiss bank must form a GmbH. It is also important, that the director is a resident of Switzerland. In the case of an AG, this company must be formed by at least three shareholders, with a minimum registered capital of CHF 100,000. It is important to note that capital cannot be increased by more than half, so you need to decide from the start how much you are willing to invest. Half of the amount must be provided before registration. Most directors must be Swiss residents. If you want to open an AG, the first step is to deposit the required minimum share capital into the bank. Also, you need to get a bank statement that certifies the financial transaction.
Documents required for registration of a Swiss subsidiary
After the contribution has been made, the articles of association are drawn up in the presence of a notary. It must notarize the personal and corporate signature of the application. The next step is the entry of a notarized charter and the bank’s certificate in the commercial register. The process of registering a subsidiary in Switzerland should take no more than two to three weeks. If required, your Swiss subsidiary must be registered as a VAT payer, and employees must be registered with the social security system. In general, setting up a subsidiary company in Switzerland is a relatively simple process and offers many great business opportunities for various companies looking to expand their business abroad.