Switzerland is a friendly place to start a business, with many international companies having their headquarters in the country. Companies both large and small are attracted to Switzerland for its stability, the strength of its currency and some of the lowest corporation taxes in Europe.
According to the Swiss Federal Statistical Office, companies with fewer than 250 employees make up about 99 percent of companies in the country and create two-thirds of jobs in Switzerland. Recently, the process of registering a company has become far simpler and is now possible online as well.
Can you work as a freelancer in Switzerland?
If you would like to work as a freelancer in Switzerland, it is recommended to start a sole proprietorship company. Initially, freelancers can work independently if evidence of your work is provided during the application for a Swiss residence permit. However, it is recommended to start a company as soon as you receive a long-term permit if you wish to continue working as a freelancer. This will allow you to receive employment benefits such as social security and accident insurance.
Expats starting a Swiss business
In order to start a business in Switzerland as an expat, you must fulfil certain financial obligations as well as residency requirements. Before you start a business as an expat, you must:
- Have at least a Swiss B-residence permit.
- Have the financial means to support both yourself, your company and your family (see the cost section below).
Accountants for starting a business in Switzerland
In order to make the process of starting your own company easier, Switzerland has many accounting firms that will be able to assist you in creating your company, making sure you select the right company for your needs.
SECO and EasyGov
As part of streamlining the process for new business startups, the Swiss government has created the new online platforms SECO and EasyGov. These allow for smaller companies to begin the company registration process online without having to contact a local office. They streamline the process for registering a company and will be able to submit all the relevant documents for you.
The organisation will also set up the necessary insurance and social security systems involved in creating a company. The service is also available in English. The business types you can set up using EasyGov are:
- Sole proprietorship
- Limited liability company
- General partnership
- Limited partnership
Alternatively, you can start your application at your local notary office in the capital of your county (canton) of residence.
Creating a business plan in Switzerland
As part of your application to start a business, your first step should be creating your business plan. This section of the application is to detail what services your company will provide once it is set up. It is here that you are expected to provide a novel or necessary service description for your company alongside registration. Some of the key things you should include are:
- The purpose of your company and the services it will provide.
- The expected size of the company.
- Your target audience.
- Structure of your company (such as shareholders, board structure, etc).
Choosing a legal structure for a Swiss company
In order to register your new company with EasyGov or with your notary office, you must decide on a legal structure for the company. The structure of a Swiss company is determined by the size of the company, its purpose and its turnover. Some legal structures require additional documents in order to proceed.
Registering your company name in Switzerland
Once you have determined your business plan, you must register the name of your new company with EasyGov or with a notary office. The rules for names in Switzerland differ based on the type of company you wish to set up to make sure there is no confusion between different company names. General rules for company names are:
- Must contain coherent words and phrases.
- Must not use directly profane language.
- Must not defame another company or undermine another company's business.
Sole proprietorship company names
In order to register a sole proprietorship company, you must include a family name as part of the company name. It is possible to add additional words to the company name, so long as it does not assume a relationship between another person or company. You cannot change the name of this type of company without re-registering.
General and limited partnership names
The name of a general or limited partnership company must include the family name of at least one of your partners or yourself. It also must include the legal designation of the company at some point in the name (KIG, KMG or KMAG). It is possible to add “& co” to the name so long as the legal code of the company is not obscured in the text.
Names for a limited liability company in Switzerland
The names of all other company types can be chosen freely, as long as it includes the correct legal code of the company type at some point during the name. The name of your company can be changed but said change must be registered with EasyGov or the notary as soon as possible.
Essential steps required for company registration
In order to register a company in Switzerland at a notary office or on EasyGov, you must provide the following information:
- The name of your company
- What type of company it is legally (GmbH, AG, KMG, etc)
- The start date of business activities
- The expected revenue of the company in its first year
- The sector of the economy that your company will operate in (culture, sport, education)
Once this section is complete, your notary will inform you of any obligations that you must complete in order to successfully register your company in Switzerland.
Social security requirements for starting a business in Switzerland
All forms of company in Switzerland must contribute to social security. This is a system that guarantees social assistance in the event of illness, unemployment and includes support for your mandatory pension. These contributions are mandated by the Swiss government and must be contributed to by the salary of all employees.
As part of your application, you will submit a salary declaration for all of your employees and your company will be registered with the OASI / IV/ LEC / ALV compensation office who will charge your company the correct amount of contribution each year from that moment on.
Swiss companies and accident insurance
In your application, all companies with multiple employees must take out accident insurance, regardless of the type of work. The accident and occupational illness insurance is typically provided by SUVA who will charge a set contribution to each employee’s salary. Independent workers can take out voluntary accident insurance if they wish. The amount that you must pay is dependent on the salary declaration made during the application.
Other forms of company insurance
There are other forms of company and private insurance that must be considered while registering a business, these are:
- Civil liability insurance for operating risks relating to the activities of the company
- Property insurance for real estate or personal property such as goods and tools
- Operating loss insurance for interruptions to profit such as strikes and arson
- Machine and IT insurance
- Additional insurance for health-related risks
- Export risk insurance
Registration for value-added tax (VAT)
If you expect your company to earn over 100.000 Swiss francs a year on a regular basis or are starting a company that produces a product, you must register with the Federal Tax Administration to pay VAT. Value-added tax is a general tax levied on the distribution, import, export and sale of a product or service by any company in Switzerland. For more information about taxes levied on businesses, please see our guide to business taxes in Switzerland.
Protection rights and intellectual property
If you plan to start a business that produces a unique product or service, it is recommended to patent or protect your idea. In Switzerland, protection of intellectual property and product protection is done via the Federal Institute of Intellectual Property (IGE / IPI). They are responsible for all patents and intellectual property claims in Switzerland and will be happy to assist you in the process of registering a patent.
Swiss trade register
Once you have chosen a name that adheres to the guidelines set for your type of business and have organised and completed your application, your company will be registered on the Swiss trade register. This is a comprehensive list that allows the government to find and check the operations of all businesses in Switzerland.
The information you will find about your company on the register will be:
- The full company name
- The year your company was founded
- The head office address
- The names of any partners, board directors, management and signatories
- The structure and type of company
- The list of any audits carried out against the company
Enterprise Identification Number (UID)
In addition to your place on the trade register, you will also receive a unique enterprise identification number. As of 2014, UIDs have become mandatory for all companies currently operating in Switzerland. The system is designed to identify companies clearly during business transactions, correspondences and the calculation of any value-added tax or social security payments. The system is mandatory and will be included once you have successfully registered the company.
How much does it cost to start a Swiss business?
The cost of starting a company in Switzerland varies depending on the legal type of company you start. For example, in starting a limited company, it is required to submit 20.000 Swiss francs alongside your application to be placed into a company account. Costs vary dramatically depending on the type of company, size of workforce and expected profits, meaning that costs could range from 500 to 50.000 Swiss francs.