BUSINESS IN SWITZERLAND
The country was not involved in two world wars, and became a member of the UN only in 2002. On the other hand, Switzerland is an active participant in international relations, aimed primarily at co-operation in the field of trade.
Business in Switzerland means competitiveness, stability and efficiency. There is virtually no inflation in the country, and unemployment rarely exceeds 2-4 per cent. In addition, Swiss universities offer high-quality and prestigious education, and the Swiss labour force is one of the most highly qualified on the planet.
Absence of corruption, firm national currency, low corporate tax rates, perfect infrastructure, reliable banking sector, transparent legal system – this is not a complete list of advantages of doing business in Switzerland.
Half of Switzerland's exports come from the European Union. In particular Germany, France and Italy. A significant part goes to the USA and China. By sectors of the economy there are financial and banking services, tourism, medicine, agriculture and industrial production based on advanced technologies. For example, the quality of Swiss watches is known all over the world.
In this article we will try to understand how to open and run a business in Switzerland for foreigners.
CONTENTS
How to start a business in Switzerland
According to Doing Business, Switzerland ranks 36th out of 190 countries in terms of accessibility of starting a business. This is an average indicator among developed European countries. Provided that certain requirements are met, any foreigner can do business in Switzerland.
First of all, it is important to have a good idea, a clear business plan and financial resources. In addition, it is necessary to assess the reality of the project, based on the market situation, the presence of competitors and experience of entrepreneurship. If everything is in order with these points, the second stage begins. Namely, the legal possibility of opening a company.
For citizens from third countries (from outside the EU) there are 3 main ways to register a business in Switzerland in 2024.
According to Swiss law, foreigners from third countries are only free to open a business if they have a Swiss residence permit category C.
The Swiss residence permit (category C) is a biometric card that is issued to foreign nationals after 10 years of continuous residence in Switzerland. This card allows you to live in Switzerland permanently, change jobs and carry out business activities.
A company can be registered by the spouse of a Swiss citizen or a person holding a C category residence card. Alternatively, it is possible to open a joint business with a Swiss resident and entrust the management of the company to a local resident. Subsequently, it is possible to obtain a work permit to work in Switzerland and run the company yourself. But it is not easy to obtain this permit.
The last and most difficult way to start a business in Switzerland is to submit an application to one of the regions of the country, called cantons. For the application to be successful, the following conditions must be met:
- personal professional qualities and experience of the entrepreneur;
- the creation of several jobs for local residents;
- The region's need for this type of business;
- significant investment;
- a long-term positive effect on the Swiss economy, including the labour market and cooperation with local companies.
If the application is approved, the foreigner will receive a temporary residence permit in Switzerland of category B or L for a period of up to one year, with the right to extend it.
Procedure and cost of company registration in Switzerland
Selecting a unique company name and opening a bank account. Bank services for the transfer of funds from the deposit account to the company account are a minimum of 200 francs.
The Articles of Association and Public Act of the company are registered with a notary and the signatures of the owners and shareholders are certified. The cost is at least 500 francs, plus 20 francs for each signature.
The procedure takes several days. In addition, each foreigner must complete two mandatory declarations Stampa (investment) and Lex Friedrich (authorisation to acquire property in Switzerland).
Registration in the Commercial Register of Companies. Depending on the size of the share capital and the number of shareholders, the cost varies from 600 to 10,000 francs. The registration period is up to 7 days. The new company is then advertised in the local commercial newspaper for 5 to 9 days.
Registration with the tax administration. This procedure is mandatory for companies with an annual turnover of more than 100,000 francs per year.
Registration of the company's employees with the social security authorities.
Forms of ownership for business in Switzerland
One of the most important steps before starting a business in Switzerland is choosing the form of ownership. It largely depends on the scale of the planned activity. Small and medium-sized businesses in Switzerland enjoy the greatest support of the government, providing 75% of jobs in the country. Let us focus on the most popular types of companies.
Individual entrepreneur (Einzelunternehmen). An excellent option for small businessmen, for example, freelancers, lawyers, doctors, artists. There are no minimum requirements for authorised capital and the procedure is very simple.
The need for registration in the commercial register arises with an annual turnover of more than 100 thousand francs. On the downside, the entrepreneur is independently liable for his obligations.
Limited Liability Company (GmbH). Due to low requirements to the authorised capital (20 thousand francs) this form of ownership is one of the most popular in the country. Registration requirements – at least two shareholders and one of the managing directors must be a Swiss resident. Information on shareholders is publicly available.
Joint Stock Company (AG). The most common form of ownership in Switzerland. It is suitable for all types of commercial enterprises. Requires a minimum of three shareholders and a Swiss resident in the management of the company. The minimum amount of the authorised capital is 100 thousand francs. Shareholders' details are not made public.
Pharmaceuticals and medical devices
Biotechnology
Agriculture
Tourism
Quality food and beverages
Financial Services
High technology and innovation
Three completed visa application forms.
Four colour photographs (according to ICAO standards).
A passport (with two free pages).
Copies of the passport – 2pcs (pages with photo, name, signature).
Copies of the last two Schengen visas, if any.
Proof of financial solvency (bank statement).
Certificate of absence of criminal record.
Letter of motivation (reasons for moving and address of residence in Switzerland).
A document confirming the existence of an entry permit from the migration authorities of the Swiss canton.
Additional documents at the request of the Consulate staff.
More detailed information on the forms of ownership for business in Switzerland can be found on the pages of the Swiss business portal SECO.
Taxes in Switzerland in 2024
Switzerland has one of the best tax systems in Europe, with low interest rates. In addition, double taxation agreements have been signed with many countries.
It is noteworthy that the federal budget of the country receives a smaller part of taxes, mainly the funds are sent to the regions (cantons) where the business is registered. Each of them sets different tax rates.
In recent years, OECD member countries have put some pressure on Switzerland. In particular, they have asked to revise some of the laws concerning banking secrecy, which makes it difficult to implement a transparent tax policy at the international level. Switzerland is even considering introducing a tax on foreigners' deposits.
As for the amount of taxes in Switzerland, there are different rates at all three levels – federal, cantonal, municipal. A progressive taxation system is mainly used. The highest taxes are in the major cantons – Geneva, Zurich, Bern, with lower rates in Obwalden and Schwyz.
The average corporate income tax rate in Switzerland in 2024 is 24.41%. This includes about 8.5% for the federal budget. Personal income tax at the federal level ranges from 0 to 11.5% (plus basic tax). The tax rate on dividends is 35%. VAT IS 7.7%.
Business destinations in Switzerland
When it comes to choosing a business destination in Switzerland, it is difficult to give specific advice. There are so many factors that influence it. Starting from the availability of residence permit and city, and ending with the available amount of assets. The only thing that can be highlighted is the promising sectors of Switzerland for investment:
Business visa to Switzerland
To stay legally on Swiss territory for more than 90 days and to carry out business activities, a national visa D must be obtained. In addition, the foreigner must have a corresponding authorisation from the cantonal authorities. The visa is issued at the Swiss Consulate in your home country.
Documents for a business visa to Switzerland
You must register at the local migration office no later than 14 days after arrival.
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