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Company formation Switzerland
Company formation Switzerland can offer many key advantages. Political stability, liberal legislation and a stable currency have made Switzerland popular with company formations. Even for the wealthy private individuals. Internationally, the Swiss stock corporation is extremely renowned. The establishment of a Swiss AG brings many advantages. In addition to low taxes, wealth is safe in Switzerland and they can legally benefit from the low taxation of their business.
If more than half of the company’s revenue is generated abroad, the tax rate in Switzerland will be approx. 9%. In order to take advantage from this rate, a special application has to be made to the tax authorities.
Otherwise companies registered in Switzerland and that derive the bulk of their revenue from Switzerland are subject three types of tax, which comprehensively range from 20% to 35%.
Switzerland’s corporate tax rates
Corporations are subject to corporate income tax as well as tax levied on equity at the cantonal and municipal level.
The federal Swiss corporate tax rate is a flat 8.5 percent. Swiss cantonal tax rates vary considerably. In general, they are progressive (depending on different factors). The rates laid down in the cantonal tax laws are usually subject to cantonal and municipal multipliers.
In Switzerland, all taxes for corporate taxpayers are deductible. As this is different in most other countries, Swiss tax rates should not be compared 1:1 with foreign tax rates. If the aggregate of all rates in Switzerland amounts to 30 percent for example (of which 8.5 percent is federal tax), the effective rate would only be about 23 percent (of which 7.8 percent is federal tax) compared to a country where taxes are not deductible. The effective maximum income tax rate of an ordinarily taxed company with an EBT of CHF 1,000,000 is roughly 24 percent, the lowest about 13 percent.
The rates of tax on equity are mostly proportional or sometimes defined by a progressive scale with a minimum and a maximum rate. For a total equity of CHF 10,000,000 the tax rate varies between 0.01 percent and 0.51 percent. Since 2009, however, cantons are allowed to credit annual equity tax against corporate income tax to the effect that profitable corporations do not owe annual equity taxes.
Main advantages of a Switzerland's geolocation
- Excellent reputation
- Corporate friendly legislation
- Safe and secure location for bank industry
- Excellent infrastructure
- Continuity of tax policy
In principle, every Swiss legal form must be owned by a Swiss resident. We have trustees who are domiciled in Switzerland and are able to provide this service.
Safe and secure location for bank industry
Swiss banks are renowned for their stability and confidentiality.
Company formation made simple and fast
- No physical presence required
- Account opening at major Swiss bank (Postfinance, Credit Suisse or UBS)
- Trustee services available
- Low tax burden
Process of incorporation
We focus on making the process of incorporation as easy as possible. We require a copy of your ID. Then you authorize us to carry out the incorporation in your name. This document must be notarized by a notary or the Swiss embassy.
What makes a Swiss company attractive to foreigners?
Due to the stable economy and the high quality of life, Switzerland is regarded as an extremely attractive location for start-ups.
Advantages of a Swiss company
- High standard of living
- Stable currency
- Strong economy
- Settlement point of many international companies
- Important financial center
- Modern and stable infrastructure
- Special programs for start-ups
Legal forms in comparison
Unlike in Germany, the stock corporation is widespread in Switzerland. The limited liability company, on the other hand, is less common. Below you will find an overview of the advantages and disadvantages of the German GmbH, Schweizer AG and Schweizer GmbH.
|AG - Switzerland||GmbH - Switzerland||GmbH - Germany|
|Share capital||at least CHF 100,000 (of which CHF 50,000 must be paid in)||Minimum capital 20,000 CHF||25,000 EUR share capital (min. 12,500 EUR must be paid in)|
|limitation of liability||limited to the assets of the company||limited to the assets of the company||limited to the assets of the company|
|Number of people||at least one company and one managing director (may be one person), but a person must be resident in Switzerland||at least one shareholder and one board of directors (similar to the board in German law), however, one person must be resident in Switzerland||1 (one-man-GmbH possible)|
|Anonymous partners possible||Yes||Yes||Yes|
|Tax burden municipal level||Cantonal strong, lowest tax rates in Lucerne and Nidwalden with 10.6% each (as of May 2014)||as with AG||Trade tax rate between 7% -16,45%
Example: Hamburg levy rate 470%, equivalent to 16.45%
|Corporate tax / federal corporation tax||8,5%||8,5%||15% plus 5.5% solidarity surcharge|
|Withholding tax||25% plus solidarity surcharge||25% plus solidarity surcharge||25% plus solidarity surcharge|
|VAT liability||Exemption up to 100,000 CHF annual turnover possible, then 8% VAT rate||Exemption up to 100,000 CHF annual turnover possible, then 8% VAT rate||yes, 19% standard rate|
Company formation Switzerland - how it works!
We are happy to advise you comprehensively and free of charge which legal form would be most suitable for you. Request a noncommittal offer. There are no hidden costs with us. Both the start-up costs, as well as all annual costs for accounting, trustee, place of business and tax returns, you will learn in advance.