Switzerland is not only known for the alpine scenery and the culture-enriched places, but it is the 3rd most famous country for entrepreneurs and business people. Yes, you heard that right. This means company incorporation or new business setup in a country like Switzerland is an absolutely perfect idea. But again, in a country with hundreds of business experts, marking your spot as a new business owner gets a bit challenging.
But no need to worry because here we will tell you about all the important facts and tactics that may help you in the formation and registration of your company and taking it to Eden heights in the least possible time. So, let’s take a flying start and gather all the crucial facts like rules and regulations, registration, and tax rate to register a company in Switzerland.
Is it a good idea to incorporate a company in Switzerland?
Why should you choose Switzerland to incorporate a company? Thanks to the Swiss constitution, people from all over the world come and integrate new business companies in Switzerland. And due to Switzerland’s competitive economy and fair policies, many people from all over the world tend to set up their businesses and invest their money there.
This undisputed innovation center is letting new business people touch the heights in the least possible time. Along with this, you get to learn a lot about business in such a constructive environment. So, we will say it is a great idea to incorporate a company in Switzerland.
The business environment in Switzerland
Switzerland is known for its undisputed policies and highly competitive economy. That’s why foreigners from all over the world tend to invest in already set businesses and companies in Switzerland. But when it comes to business incorporation from the top, Switzerland is the best choice for taking your baby steps in business. Starting your work from here means easy access to the EU single marketplace.
While keeping the stable and exceptional economic framework in Switzerland, we can say that you can immediately think about business incorporation in this country. No matter it’s about the labor market, workers’ efficiency, or the government’s efficiency, everything is to die for. And guess what? Moderate taxation is what gives excellent benefits to foreigners who come to settle their businesses in Switzerland.
These are why some of the best multinational companies, like Nestle, have their headquarters in Switzerland.
Examples of the most profitable businesses in Switzerland
If you want to start your business in a country like Switzerland, try to take a wise decision and opt for the most worthwhile idea ever. Here we are with some of the best examples from which you can choose and get maximum profit.
- House Cleaning Services
- Photography company
- Career Coaching
- Interior decoration services
- Meal delivery services
- Real estate companies
- Textile companies
- Insurance and finance companies
- Franchise training
- Food Tech
- Web Designing
- Meal delivery services
- Bike Rentals
- Academic tutoring
- Nutritional consultancy
Benefits of incorporation of a company in Switzerland
Switzerland is located in the western European region, which offers the best environment to undergo all of the business activities. Also, it is surrounded by the top and economically string companies in the world like Germany, France, and Italy. So, we can say that starting a business in a country that offers an excellent track to enter the European market is a great choice. And keep one thing in mind about 805 Swiss imports goods from Switzerland, so it is evident that your business is likely to get great exposure in European countries if you incorporate a business in Switzerland. Let’s see the other benefits of incorporating a business in Switzerland.
- Highly developed country
- Loyal and hardworking workforce
- Switzerland is the center of innovation.
- Provides an excellent infrastructure for foreign investors,
- Lower Tax rates,
- a great supportive political environment
- Financial stability
Pros and Cons Discussed
|– Stable environment |
– Taxation benefits
– Social laws
– Stable economy
– Quick Incorporation – Full control is possible
|– Relatively an expensive country to live in|
– Banking is a complex procedure. This is why FirmEU specialized in banking solutions for Swiss companies.
– Every part of Switzerland has different taxation and business rules. That is why it is important to work with a company like FirmEU for compliance.
A step-by-step Guide- Incorporation of a company in Switzerland
After the establishment of your company no matter in what part of the world the next major step is the incorporation of your company. This means you need to undergo a legal process for a corporate legal entity of your newly established business. Here are the steps that you need to follow to incorporate your company in Switzerland.
- First, you must choose an appropriate and well-suited name for your company. End the chosen name with “Limited” if it’s a public company or a private company, then go for “private limited”
- Now you have to work on the memorandum or constitution of your company. Mention all the objectives and rules your company is going to follow.
- Go for printing, signing, and stamping of your memorandum. If you don’t have any experience in getting these services done, you can take help from Registrar. Once everything is set, your memorandum can be printed immediately.
- Now, it’s on the promotor to hire an attorney who will stand on your behalf. Also, he can make all possible changes to the memorandum and the company’s constitution.
- Get all three forms, i.e., e-form no. 32-consent of directors, e-form no. 18 and e-form no. 32-Particulars
- Payment of registration fee
- The final step is to get the certificate of incorporation.
If you still have some issues or are facing any difficulties, getting help from service providers like Firm EU would be a great idea.
Things to know before you set up a business in Switzerland
There are four legal forms from which you have to choose before setting up a company in Switzerland. Here we will mention all of them.
- Limited liability company (LLC)
- Sole proprietorship
- General partnership
- Limited company
Give maximum time to the development or business plan to reach the heights of success in the least possible time. Work hard on the development team, business model, services or the products you are going to provide, and financial needs.
Work to form a strong foundation for your company. Taking help from a service provider like Firm EU will be a great step.
Take measures for the insurance of your company.
Maintaining progress records must be your and your team’s top priority. This step is a legal obligation, so make sure that you are in compliance with every legal obligation.
What is VAT?
Valued added tax or VAT is a consumption tax levied on goods and services. It is levied on each stage of the supply chain. This tax is similar to sales tax up to some extent. Still, the only difference both of these have is that with sales tax whole amount paid goes to the government, whereas in VAT, the amount is divided into several chunks and is held over to different parties.
Three Types of VAT
- Standard Rated VAT
- Zero-rated VAT
- Exempt supplies
The VAT rate in Switzerland
No matter what you are buying in Switzerland you will have to pay 7.7% VAT.
The corporate income tax rate in Switzerland
On the federal level, Switzerland levies 8.5% CIT on every profit. (After Tax).
And the CIT rate on profit before tax is almost 7.83%. (Before Tax).
Accounting rules in Switzerland
- No matter what calendar you are using for your company remember tax calendar is the calendar year. Your annual tax will be calculated every year on the basis of your income and profit.
- Your registered company needs to follow all the rules and swiss code obligations.
- It is compulsory to maintain a balanced profit and loss sheet, and it should be prepared all the time to be presented. Make this statement as accurate as possible so that the evaluation process becomes the simplest.
- Seek an audit officer every year to seek your company’s financial health.
How to register a company in Switzerland?
Registering your company means that you are taking steps to grow your business or increase your company’s exposure in the corporate world. Remember that registered companies are always preferred in the global market. Here are the steps you need to follow to register a company in Switzerland.
- Select a unique and distinctive name for your company.
- Opening up a bank account that you will use to deposit the minimum capita amount of your company.
- Draft your articles and authenticate the documents of your company.
- Send your documents to the registrar via email or handing them over directly is another option.
- Now is the time to pay stamp tax.
- Here comes the time when you will register your company for VAT.
- After you are done with the commercial registry, make sure to register it with Federal Tax Administration as well.
- Don’t forget to complete employee and company insurance as a final step.
We hope that after reading all of the intricate details mentioned in this article you must be there with a clear mind that what is your next step for your successful business. Starting a business seems easy but taking it towards the end and then attaining success is not that much easy. You have to work day and night to achieve success and convert your dream into reality. If you want to read more about a company formation in Switzerland, visit the FirmEU – Switzerland company formation page.
Well, we hope that you must have got your answer about why you should choose Switzerland to incorporate a company. We would recommend you hire a team of professionals like Firm EU to help you out in passing all the legal and corporate hurdles for your newly set business in Switzerland.