Doing Business in Switzerland

 

Business Concept

      • A Business Concept written on 1 (!) sheet of A4 paper should do it for a startup.
      • Core ideas, the clients, where the money comes from
      • For a detailed business concept we recommend the „Business Model Canvas“

 

Business Organisation

It is recommended to set up and execute the internal processes as structured as possible right from the start. We are happy to support you in designing your processes. We can draw on many years of experience and numerous ERP Implementations. Don’t hesitate to contact us.

 

 

Juristic Person

Is viewed by law as a firm which is liable for problems. The firms are registered in the commercial registry.

      • AG - corporation. The share holders hold the capital and are usually anonymous an not liable. The seed capital is a minimum of CHF 100’000.—. There are notary costs for the founding process and documents.
      • GmbH - Limited liability Company (LLC). The partners bring the capital, are registered in the commercial registry and can be liable for gross negligence. The seed capital is a minimum of CHF 50’000.—. There are notary costs for the founding process and documents.
      • Kollektivgesellschaft - General Partnership. Several private persons get together to found a company. Each member is liable together with the others with his private assets. There is no need for seed capital. It is possible to register the company in the commercial registry.
      • Einzelfirma - individual enterprise. A single person opens a company and is liable with its private assets. No need for seed capital. It is possible to register the company in the commercial registry.

 

Commercial registry

The entry in the commercial registry of the canton is mandatory for bigger companies but important for all companies. Often, for collaborations with other companies, this official document is requested by the other party.

      • Caution: There are illegitimate registries which pretend to be official.
      • Additionally there are unofficial registries by private companies and associations. These registrations are often expensive and not necessary.

 

Value added Tax (Mehrwertsteuer)

Like in other countries you have to charge the customer a value added tax and you can deduct the tax  you paid to you suppliers. The difference that remains is the value the company has added and this added value is being taxed.

      • There are several tax rates in Switzerland. The standard rate is 8% and there are two reduced rates for certain commodities or branches.
      • You have to file a statement to the federal VAT bureau every quarter as well as a final statement at the end of the year with which you have to pay or receive a balance.

 

Social Security

Some parts of the Social Security contributions are paid by the employer, others by the employee. There are:

      • AHV - Old age and surviving defendants insurance
      • IV - Invalidity insurance
      • EO - income compensation (maternity leave, military service)
      • BVG - Company Pension Fund (mandatory)
      • 3rd Column - Private Pension Fund

 

Taxes and Tariffs

      • Company Tax. Profits of a company are taxed. Due to the international activities of Swiss companies these tend to be reduced. 
      • Employee Tax. Part of this tax is directly deducted from the salary. The other part is paid after the private tax forms have been filed. Here you are also taxed on your assets and other private income streams. However, some expenses can be deducted. Depending on the family situation you have a different tax exempt amount so that you pay less taxes with a low income.
      • Other taxes are paid with fuel, alcohol, tobacco, mining rights, Billag (radio and tv), Suisa (intellectual property), Swico (recycling), refuse, import tariffs.