Establishing a business in Switzerland

Switzerland is federal: company law and VAT are national, but the commercial register, most taxes and many permits are cantonal, so where you set up changes what you pay. Formation is well organised (most cantons accept everything through the EasyGov portal) and takes two to four weeks for a company. Costs are higher than in most of Europe and so is the paperwork discipline expected afterwards. 1. Choose the legal form. Sole proprietorship (Einzelfirma / raison individuelle). You and the business are the same person; the business name must include your surname. No capital, no notary. Registration in the commercial register is mandatory once annual revenue exceeds 100,000 francs and optional below that. You are personally liable, and profit is taxed as your income. You must also have your self-employed status recognised by the cantonal AHV compensation office, which checks that you really work for several clients at your own risk. GmbH (Sarl). A limited liability company with a minimum capital of 20,000 francs, fully paid in. One or more owners, whose names appear in the public register. The usual choice for a small business, a family firm or a first company. AG (SA). A joint-stock company with a minimum capital of 100,000 francs, of which at least 50,000 must be paid in. Shareholders stay anonymous, shares transfer easily; chosen when investors, employee participation or a larger scale are planned. Both the GmbH and the AG limit liability to the company's assets and pay corporate tax on their own profits. 2. Form the company. Reserve or check the name (the commercial register office does this), draft the articles of association, and open a capital deposit account at a Swiss bank where the capital is blocked until registration (the bank issues a confirmation; some banks charge around 250 francs, some nothing). A notary then certifies the deed of incorporation with the founders present or represented. The notary files with the cantonal commercial register office; the entry is published in the Swiss Official Gazette of Commerce, after which the bank releases the capital to the company's operating account. Commercial register and publication fees are a few hundred francs (around 550 francs for a simple company); notary fees vary by canton from a few hundred to over a thousand francs; formation services offer packages, and EasyGov lets you file most of it online. Total for a straightforward GmbH: roughly 1,000 to 2,500 francs before your own advisers. Swiss-resident signatory: every GmbH and AG must have at least one person with individual signing authority (a managing director, board member or authorised signatory) who is resident in Switzerland. Foreign founders without a resident partner engage a resident director or a fiduciary for this role. 3. Register for tax and social insurance. Corporate taxes: profit is taxed at federal (8.5 percent statutory), cantonal and communal level. The combined effective rate in 2025 ran from about 12 percent in Zug and 13 to 15 percent in Basel, Vaud and Geneva to just under 20 percent in Zurich; the Swiss average is around 14 percent. A capital tax on the company's equity is levied by the cantons as well. Cantons publish calculators, and the location decision is worth an hour with an adviser. VAT (MWST / TVA): registration with the Federal Tax Administration is compulsory once worldwide turnover from taxable supplies reaches 100,000 francs a year; you can register voluntarily below that. The standard rate is 8.1 percent, with 2.6 percent on food, books and medicines and 3.8 percent on accommodation. Returns are usually quarterly; the net tax rate method simplifies the calculation for small businesses. Social insurance: register with the cantonal compensation office (AHV/AVS) as an employer before the first salary; contributions for old-age (AHV), disability (IV), loss of earnings (EO) and unemployment insurance (ALV) are split between employer and employee and paid monthly or quarterly. Employees above the entry threshold must be insured in an occupational pension fund (BVG second pillar), and accident insurance (UVG) is compulsory from the first employee. A managing owner of a GmbH or AG is an employee of the company for these purposes. 4. Permits and residence. Most trades are free to exercise, but the cantons license restaurants, hotels, transport, construction, health and care professions, financial services, real estate brokerage and others; ask the cantonal economic affairs office before signing a lease. Foreign nationals: EU and EFTA citizens may move to Switzerland and become self-employed or run their company under the free movement agreement with a residence permit obtained on arrival; citizens of other countries need a permit under the annual quotas, with the canton assessing the economic interest of the business. 5. Bank account, bookkeeping and the register. After registration, the capital deposit account becomes or is replaced by the operating account. Swiss banks apply careful compliance checks and may decline foreign-controlled companies without local substance; fintech providers are an alternative for day-to-day payments. The Code of Obligations requires proper double-entry bookkeeping for every company and for sole proprietorships above 500,000 francs of revenue; smaller sole proprietorships keep simplified records of income, expenses and assets. Keep every change of address, director or signatory current in the commercial register: the register is public and third parties may rely on it. 6. Annual obligations. A GmbH or AG prepares annual financial statements, holds an annual meeting of shareholders, files a corporate tax return in the canton, and, above the size thresholds (balance sheet 20 million francs, revenue 40 million, 250 staff, two of three in two consecutive years), has an ordinary audit; below them a limited audit applies, and companies with fewer than ten full-time staff may opt out of the audit altogether with all shareholders' consent. VAT returns and social insurance settlements follow their own calendar. What it costs to start, roughly: a sole proprietorship, the commercial register fee if you register (a couple of hundred francs) and your accountant; a GmbH, 20,000 francs of capital (which remains the company's working money), 1,000 to 2,500 francs of formation costs, and an accounting or fiduciary firm from about 2,000 francs a year. Where to get help: the fiduciaries (Treuhand), lawyers and accountants listed under this guide work with Swiss start-ups; EasyGov.swiss and the SME portal of the State Secretariat for Economic Affairs (kmu.admin.ch) explain each step in four languages; the cantonal economic development offices help with permits and location. Figures checked September 2026. Tax rates differ by canton and commune and change yearly; confirm the current position with a licensed professional in the canton where you will set up before you rely on it.