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Swiss Company Formation

 Switzerland is without question one of the best countries in the world in which to live. When you combine the quality of life with efficient and confidential banking, political and economic stability, first rate communications and experienced professional services Switzerland tends to score very highly. As far as tax is concerned the federal Swiss political structure in which the country is divided into 26 separate Kantone (Cantons, Cantoni or States) makes choosing the correct location extremely important but we can generally advise you regarding the best options. Most popular for company registrations are Zug, Zurich, Geneva, Lugano and Luzern. The Swiss Kantone are very different in a significant number of areas among which the main ones are language, taxation and day to day business practices. Clients often ask how much tax a Swiss company will pay and as outlined in this section the choice of Kanton will determine the amount of tax paid to some degree but the 7.8% federal tax on your company's income (effective rate), plus a small amount of tax on the official capital of your company - between 0.35% and 0.075% of the capital gives some idea of what you will need to factor in, on top of this will be the local tax and we generally advise clients to budget for 8% of net income before taxes and local tax.

Although living here is very pleasant with excellent summer weather you do not need to live here to take advantage of many of the facilities Switzerland has to offer. One important thing to consider is that Swiss companies are neither free of tax nor filing obligations so the administrative requirements will be more burdensome than operating an IBC or an LLC which is based in another jurisdiction. Having said that incorporating in Switzerland is still easier than in many other European countries such as Germany but it still requires a considerable amount of time, money and effort compared to an offshore jurisdiction.  Basically there are two types of companies in Switzerland as outlined below.

SWISS COMPANY FORMATION
 
Swiss GmbH (Gesellschaft mit beschränkter Haftung) referred to in French speaking parts of Switzerland as an Sàrl
 
The Swiss GmbH is a Limited Liability Company mainly utilised by small businesses because of the lower costs to form and reduced capital costs.  Our incorporation fee for a Swiss GmbH is around CHF 6,500 Swiss Francs.  The capital investment (which must be paid up) in the company is CHF 20.000 (roughly 15,000 in Euro's). There needs to be at least two partners to form thea Swiss GmbH; and at least one should be a local resident. To comply with the need for a local resident a nominee can be appointed.
 
Swiss AG (Aktiengesellschaft) - referred to in French speaking parts of Switzerland as an  SA
 
A Swiss AG is a Corporation with much more rigid requirements.  A minimum capital investment of 100, 000 Swiss Francs is required; half of which must be paid upon application.  A minimum of three shareholders are needed but unlike in the case of the Swiss GmbH, shareholders in a Swiss AG remain totally anonymous.  The minus point for non residents forming an AG is that the majority of the company’s directors need to be local residents.
 
Regular requirements for both a GmbH and AG are the payment of stamp duties, registration for taxes and enrollment for Social Security.  Taxes differ significantly from one Kanton to the other although we find Zug to be a good choice. Taxes are also dependent on Swiss federal taxation regulations.  Compared to other offshore jurisdictions, incorporating in Switzerland can appear rather rigid but its reputation can sometimes justify the effort.

What are the main types of company in Switzerland?

There are two major types of business entity for foreign investors, and they are as follows:

  • Limited Liability Company (GmbH / Sàrl)
  • Corporation (AG / SA)

Below is a summary of the main features of a GmbH / Sàrl

  • Mainly used for small to medium sized businesses
  • Minimum share capital is 20,000 Swiss Francs (€15,000)
  • No restrictions on foreign ownership
  • Minimum of two people are required to establish the company
  • One of the directors must be a resident of Switzerland

Below is a summary of the main features of a AG / SA

  • Generally used for medium to large sized businesses
  • Minimum share capital is 100,000 Swiss Francs (€75,000)
  • At least 50% of share capital actually needs to be paid up
  • Shareholders can remain anonymous
  • The majority of the board directors must be Swiss residents

Is it easy to open a bank account?

When it comes to choosing the bank which will provide the banking facilities for your Swiss company there are so many options with leading banks such as Credit Suisse, UBS and Kommerzbank this will be once of the easiest parts of the whole setup procedure. One consideration when it comes to arranging the banking is that Swiss banks are subjected to strict due diligence requirements and are often extremely cautious when they are dealing with new clients. Because Swiss banks are cautious and conservative they tend to prefer new clients to be introduced by people they already know and trust. This is one of the reasons that ORCA will help you to open the account or in the case of a company formation in a French or Italian speaking Kanton refer you to one of our local partners.

ORCA fees for the formation of Swiss company GmbH/Sarl /AG/SA

The fee to form a company will vary greatly from one Kanton to another but below is example which encompasses everything required to form the company and apply for the registration in the Zug trade register. In this case the company is formed in the Kanton of Zug and can be arranged in person or by mail.

The total cost of the formation below including all of the items listed is: US$3995 

Our fixed fee company formation service in Zug comprises all of the steps required for the establishment of the company and registration in the trade register. This offer is available to both residents and non residents.

You have a choice of forming the company by mail or visiting our colleagues in Zug to deal with the formation in person.  

Fees Include:

√ verification of company name
√ check and exact phrasing of the purpose
√ optional: opening of a capital contribution account for establishment purposes
√ preparation of all documents required for the establishment of a company:
√ comprehensive statutes
√ registration in the trade register
√ official certificate of the establishment
√ Stampa declaration
√ Lex Friedrich declaration
√ shareholder register (LLC (GmbH)) or share register (LTD (AG) in case of registered stocks)
√ waiver of a limited audit (if required)
√ any number of shareholders
√ any number of executives / members of the board of management
√ any number of authorised signtories
√ official notarial act including notarial charges
√ registration in the trade register
√ optional: registration at the Swiss Federal Tax Administration for the value added tax

Commercial register charges: The charges for the registration in the commercial register are not included in the above.

Fees in year 2 and onwards are: CHF4,250 

Recurring maintenance fees from the 2nd year and onward

  • Domiciliation fee
  • Maintenance fee

As far as the total cost of a formation in locations other that Zug it is hard to be specific because it will depend on whether you reside in Switzerland, form a GmbH or an AG and also the exact form of the structure. Zug is one of the best Kantons in which to form a company and the price above we are confident you will find to be very competitive. In Zug we also offer a comprehensive package with additional facilities as outlined below.

√ express formation       
√ fees for Commercial Registry       
√ account opening for capital contribution       
√ legal domicile including forwarding of mail and postage       
√ accounting, annual accounts and tax return (300 entries per year)

This package is CHF 7,995 in the first year and CHF 4,250 in subsequent years



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