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How to Incorporate a Company in Switzerland?

Incorporate a Company in Switzerland

Company formation is Switzerland involves taking up of several actions that include drafting of the Articles of Association, the filing of special forms from the Company Registration office, and various documents like specimen signatures and passport copies of the prospective owners. The public notary is a must in regard to Company formation in Switzerland. In the process of Incorporate a Company in Switzerland involves a finding of the registered office, setting up of bank account and hiring of the local accountant along with various other compliances. Here is article

What is the Procedure of Company Registration in Switzerland?

The first step in the registration of Company in Switzerland is that the proposed Company should have a unique name. The name so decided needs to be reserved in the Company Register before registration of the Company. This includes searching the registers (manual and automated) if the name is available and free for usage. If the proposed name is free for registration a reply is given in writing whereupon a fee of E20.00 is paid to the government revenue offices for the reservation of the name.

The second step involves the Memorandum and Articles of Association to be lodged with the office of the Registrar of Companies, Switzerland. The documents also include:

  • Memorandum and Articles of Association
  • Reservation application and reply
  • Notice of Company Registered office
  • Directors tax clearance certificates
  • Identity documents of the Directors
  • Declaration of Compliance
  • Name reservation payment receipt
  • Payments receipts in respect of Company Registration.

Foreign Companies to be registered locally:  After the establishment of the Foreign Company, the Foreign Company within 21 days of such establishment provide to the Registrar:

  • Certified Copy of the Memorandum ad Certificate of Incorporation.
  • Registered postal address where notices shall be served.
  • Name of the Auditor and address of the Auditor
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What are the Documents Required for Company Registration in Switzerland?

The following documents are required for the formation of Company in case of individual shareholders:

  • Name and residential addresses of the beneficial owners
  • Proof of Identity (passport)
  • Proof of residency (utility bill)

In case of the corporate shareholders:

  • Copy of certificate of Incorporation
  • Persons authorized to sign on behalf of the parent Company
  • Name and address of the directors of the Company (along with the copy of passport/proof of residential address

The Business Questionnaire containing:

  • Intended name of the Company
  • Type of the Company
  • Authorised Capital of the Company
  • Paid up share capital of the Company
  • Nominee Arrangements
  • Purpose of formation of the Company

Taxation Aspect in Switzerland

Some of the Swiss Companies do not require registration for taxation purpose. The requirement is determined by the nature of the activities of the Company. The requirement if mandatory for certain type of Companies has to submit an application to the Federal Tax Administration after the incorporation process is finalized at the Commercial Register. The legal entities which have either the registered office or an actual administration in Switzerland are subject to unlimited tax liability. The limited tax liability is applicable for the foreign corporations with a permanent establishment or real estate in Switzerland. If compared internationally, Switzerland is considered to be a very attractive location for the corporate taxpayers. Thus Switzerland has a classical corporate tax system in which the corporations and owners are taxed individually usually causing double taxation.

The taxation of the shareholders from the dividends is 40% at federal tax rate.

Annual Compliance in Switzerland

Annual Returns: the registered company has an annual obligation to file an annual return with the Companies Registration office (‘CRO’). The annual return is required to provide details of the share capital, shareholders and officers of the Company at a designated date, being the annual return date. The return is usually filed with a copy of financial statements which covers the relevant accounting period.

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Annual General Meeting (AGM):  there is a requirement of conducting an Annual General meeting of the Company every year within prescribed timelines. There are certain companies which can decide the conduction of physical AGM or not.

Maintenance of Statutory Registers: the Directors need to ensure that there the proper books and records are maintained. The statutory Registers and minutes of all director and shareholder meetings should be updated and kept at the registered office of the Company.

Number of Directors or members: A company limited by shares must have at least one Director. There is no maximum limit of Directors. At least one Director/Managing officer or one other senior manager who represents the company with signatory power must be resident in Switzerland.

Taxpayers are required to file annual tax declarations for their corporate income and capital taxes.

Market Size

The Economy of Switzerland is considered to be the world’s most advanced economies. The service sector of Switzerland plays a very significant role in the development and growth of the economy. In particular, the Swiss banking Industry and tourism are the prominent areas which capture the major market size of Switzerland. The industrial sector is one of the most extensive sectors in Switzerland. The present companies like Nestle, Sika AG, Roche, and various other Companies contribute to the growth of the industrial sector globally.

What all Industries/Business Popular in Switzerland?

The most popular business in Switzerland and the most beneficial sector is tourism. Switzerland has a highly developed tourism infrastructure, most particularly in the mountainous regions and cities, making it a good market for tourism-related services.

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Benefits of Company Registration in Switzerland

  • Tax benefits: Companies with mainly foreign or holding activities are most benefited because of the reduced communal taxes, both on the income and on the capital.
  • Switzerland is one of the leading industrialized countries in enabling the acquisition of the new skills and technology in order to achieve growth in the economy.
  • Research facilities: the research facilities in Switzerland are long-term, stable and have decision-making fundamentals which encourage in research and production activities.
  • The European location is considered to be appropriate for business because of extensive growth opportunities.
  • Switzerland is one of the most liberal and competitive economies in the world. The banking industry is an important sector in the Swiss The laws are prominent in the regulation of the banking system particularly the banking secrecy policies offer extensive protection for domestic as well as foreign investors.
  • It is an attractive location for foreign direct investment.

Bank Account Opening Process in Switzerland

One of the important aspects of an entrepreneur is to open a bank account for the Company. The impressive banking system serves as the biggest strength of the company due to its privacy policies. The criteria’s are:

  • The account cannot be anonymous.
  • Name and other details of the company
  • Description of economic origin of funds
  • Details of the signatory.

FAQ for Company Registration in Switzerland:

  • Can a Foreigner open a company in Switzerland?

Yes. Foreign investors can benefit by opening the company in Switzerland

  • Does the registered office need to be in Switzerland?

Yes.

  • What is the minimum capital requirement for a Swiss Company?

It depends on the type of Company. For Limited Liability Company the capital is at least 20,000 CHF and for a corporation, it is 1, 00,000 CHF. A sole proprietorship can have any amount of capital.

  • Is the bank account for Company Compulsory?

Yes. The Company’s Bank Account should have minimum share capital deposited.

  • Is special permit license needed in Switzerland?

Yes. In case of certain business activities, a special permit is required, apart from the mandatory business registration.

Also Read:
Foreign Company Registration in India
Switzerland’s Tax Regime: A Complete Guide

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