Doing business in Switzerland
- How quickly can I set up a business?
- What is the minimum investment needed?
- How can I raise finance?
- What are the legal requirements for setting up my business?
- What structure should I consider?
- What advice can you give me in regards to payroll and taxation requirements?
- Is there anything else that I should know?
How quickly can I set up a business?
Within 2 weeks.
What is the minimum investment needed?
The share capital of the GmbH (at least CHF 20,000) and the share capital of the AG (at least CHF 50,000) must be paid into a blocked account at a Swiss bank when the company is founded. The money is blocked until the company is entered in the commercial register. In order to be able to withdraw the money from the blocked account again, the bank must be presented with a copy of the extract from the commercial register.
How can I raise finance?
Investor must contribute the entire capital.
What are the legal requirements for setting up my business?
Participations in the stock corporation:
The shares can score points with their low nominal value per share; this can be, for example, only one cent. Furthermore, selling shares is a lot easier than selling ordinary shares.
Participations in a GmbH:
Ordinary shares in a GmbH, on the other hand, must have a nominal value of at least CHF 100. Another disadvantage that comes with the common shares is that the shareholders are entered in the commercial register with their names and domiciles. The shareholders of an AG benefit from greater anonymity here, since, for example, holders of registered shares generally only have to be entered in the company’s own share register, i.e. the shareholder status is not public.
What structure should I consider?
The Swiss corporate landscape is mainly dominated by sole proprietorship, AG and GmbH. The sole proprietorship is a very popular legal form because it can be set up quickly and easily. However, the owner is not only liable with business assets, but also with all of his private assets. Here the AG and GmbH offer more security, as the liability is limited to the share capital. However, there are also many differences between these two legal forms, which we would like to explain in this article.
What advice can you give me in regards to payroll and taxation requirements?
In Switzerland, salaries are negotiated either on an individual basis or collectively. Collective negotiations are conducted by the social partners (trade unions and employers’ associations) for a whole sector or for specific companies. Working conditions and salaries are thus agreed jointly in a collective employment agreement (CEA) containing provisions on minimum wage levels, continuation of wage payments, vacation, working hours and termination of employment.
Private individuals have to pay tax on their income and assets.
Compulsory health insurance:
Foreign nationals must take out insurance for themselves and for their families with a Swiss health insurance company no later than three months after arriving or beginning work in Switzerland. Cross-border commuters domiciled in certain EU states have the option of taking out insurance in their country of residence instead of Switzerland.
Accident insurance at the workplace:
If you work eight hours or more a week, you are covered against accidents by your employer.
Old-age, Survivors’ and Invalidity Insurance:
Persons who live or work in Switzerland must be insured by the Old-age and Survivors’ Insurance scheme (AHV) and by the Invalidity Insurance (IV).
Employees earning over a certain income must take out insurance with a pension institution (pension fund or vested benefits institution). Self-employed persons may join a pension fund voluntarily.
What you need to do in the event of unemployment:
If you are looking for work or lose your job, you must register with the regional unemployment centre (RAV). If you live abroad and work in Switzerland, you will receive your unemployment benefits in your country of residence.
Is there anything else that I should know?
In the case of a stock corporation:
Exclusion from an AG is only possible if the shareholder does not properly fulfill his / her contribution obligations (= payment of the share capital).
In the case of a GmbH:
In a GmbH, the shareholders can be excluded from the company under certain conditions and if there are important reasons. In addition, further reasons for exclusion can be recorded in the articles of association. This expanded scope clearly represents an advantage over the AG.
In consulting practice, it is often the case that founders decide on a GmbH or an AG based on their initial capital. The statutory options are rarely really taken into account.
Switzerland is the most competitive business hub in the world. Hence, there are numerous good reasons to establish your business in Switzerland:
• In the Global Talent Competitiveness Index by INSEAD, Switzerland ranks first.
• The most common choices are either a limited liability company and stock company or branch offices of a foreign company.
• Come to Switzerland for Innovation and technology, a liberal economic system, political stability, close links with foreign markets, excellent education and healthcare systems, an outstanding infrastructure, and a high standard of living.
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