Company Registration: Switzerland. Ready-Made Company GmbH

Swiss law allows businesses to be established in many legal forms. For a foreign investor planning business in Switzerland, the following forms may be of particular interest:

• public limited company (AG / SA)
• limited liability company (GmbH / SARL)
• partnership

Depending on the part of Switzerland where the company is registered, the legal-form ending in its name may differ by language. For example, a public limited company may use AG in German-speaking cantons and SA in French- or Italian-speaking cantons. A limited liability company may use GmbH, SARL or Sagl. The same language principle applies to other Swiss legal forms.

A Swiss public limited company (AG or SA) may be established by one or more shareholders, who may be individuals or legal entities.

• The minimum share capital is CHF 100,000. At incorporation, at least 20% of the capital must be paid in and, in all cases, at least CHF 50,000.
• A standard private AG uses registered shares; bearer shares are allowed only in special cases provided by current Swiss law.
• The board of directors may consist of one or more members; at least one representative with signing authority must reside in Switzerland.
• The company keeps accounting records and prepares annual financial statements; the audit format is determined by the current criteria.

A Swiss GmbH (SARL / Sagl) may be established by one or more members, who may be individuals or legal entities.

• The minimum capital of a GmbH is CHF 20,000 and must be fully paid in or covered by an eligible contribution in kind.
• The participation interests are registered; information on the members is shown in the commercial register.
• At least one representative with signing authority must reside in Switzerland.
• A GmbH keeps accounting records and prepares annual financial statements; the audit format depends on the size of the company and the current criteria.

Swiss law allows both general partnerships (Kollektivgesellschaft - Societe en nom collectif - Societa in nome collettivo) and limited partnerships (Kommanditgesellschaft - Societe en commandite - Societa in accomandita).

A Swiss general partnership (Kollektivgesellschaft) is formed by at least two individuals. A limited partnership (Kommanditgesellschaft) must have at least one general partner who is an individual with unlimited liability and one limited partner, who may be an individual or a legal entity. There is no fixed minimum capital for these forms. The tax result is attributed to the partners under the current rules.

Holding companies are not a separate legal form in Switzerland. It is an economic and legal concept for certain financial activities based on the so-called test of"substantial participation", which in practice means the following:

• A Swiss AG or GmbH may operate as a holding company under the general corporate tax system. The former separate cantonal holding statuses have been abolished; participation relief is applied through the participation deduction.

Swiss AG and GmbH companies pay corporate income tax at federal, cantonal and municipal levels. The federal rate on net profit is 8.5%. Capital tax is charged at cantonal and municipal levels, so the final tax burden depends on the canton selected.

Switzerland has signed double taxation agreements with countries including:

HOLDING COMPANIES — Switzerland

Special relief available to holding structures is based on the following rules:

• The participation deduction is calculated under current federal rules: for dividends, a participation of at least 10% or a market value of at least CHF 1 million is relevant; for capital gains, a separate participation and holding-period test applies.

Types of holding companies:

in current practice, Swiss holding and operating AG/GmbH companies are taxed under the general system. The participation deduction applies to qualifying participations, while corporate income tax is calculated at federal, cantonal and municipal levels.

Income of a holding company is taxed under the general federal and cantonal rules, with the participation deduction applied to qualifying participation income.

“Participating” companies are ordinary manufacturing or trading companies that, in addition to their main activity, own shares or interests in other businesses. If such external investments meet the “substantial participation” criterion, the related income is deducted from the total profit subject to tax at federal and local levels.

The separate cantonal domicile-company regime no longer applies. International business uses a standard AG or GmbH that pays federal, cantonal and municipal taxes under the current rules. When selecting a canton, we compare the effective rate, presence requirements, accounting and annual administration costs.

In some cases, a “domiciled” company may maintain a real office and staff. The centre of management and control may formally be located in the country, even if the actual operating situation differs. Historically, this option existed in the Swiss canton of Fribourg. Resident status provides access to Switzerland’s broad tax-treaty network. Zug and Neuchâtel have also traditionally been considered favourable cantons.

For a headquarters, group structure or international office in Switzerland, a standard AG or GmbH may be used. Staff and office costs are recorded in the accounts, while taxable profit is calculated under the general rules and the arm’s-length principle for intra-group transactions.

Foreign individuals and legal entities may own a Swiss AG or GmbH. For practical implementation, we determine the owners and directors, canton of registration, bank account and beneficial-ownership documents in advance; participation relief applies when the current conditions are met.

Taxation of holding companies:

A Swiss company holding a qualifying participation may use the participation deduction. At federal level, it applies when the established participation criteria are met; together with cantonal rules, this allows dividend and investment income to be structured efficiently within a standard corporate form.

• The company pays income tax at federal, cantonal and municipal levels. The federal rate is 8.5% of net profit; there is no separate federal capital tax, while capital tax is charged at cantonal and municipal levels. Current participation-deduction rules and double taxation agreements apply to dividends and qualifying participations.

For an international AG or GmbH, the tax burden depends on the canton, municipality, profit and nature of income. We compare several cantons before registration and separately review the participation deduction if the company will own interests in subsidiaries.

The special domicile-company regime has been abolished. In 2026, AG and GmbH companies use the general cantonal and federal system; the final tax burden depends on the canton, municipality and income structure.

The participation deduction applies to qualifying participations. For dividends, a participation of at least 10% or a market value of at least CHF 1 million is relevant; separate requirements for participation percentage and holding period apply to capital gains. We calculate the specific tax result based on the asset and distribution structure.

Capital tax is charged at cantonal and municipal levels under the rules of the selected canton. We therefore calculate the total annual cost of an AG or GmbH before registration together with corporate income tax, accounting and corporate maintenance.

The vast majority of holding companies in Switzerland are share corporations (“Societi Anonyme, S.A.”). Limited liability companies (“Societi a responsabiliti limitie, Sari”) may also be used as holding companies. A holding company describes the purpose of a company rather than a special legal form. The same company may also engage in trade, intermediary services or production. These activities are less traditional for Swiss companies because of their cost level, although whether the cost is high depends on the scale of your business.

Without focusing on “dividend” benefits that are of little practical use or on royalty relief that may be less attractive than in some other European countries, we can say with confidence that Switzerland has been and will remain one of the most expensive,prestigious and secure jurisdictions for a holding company, providing reliable protection for your investments, assets and cash holdings. As a reminder, certain reliefs are available where the investment amount is at least€1.600.000...We can offer youready-made Swiss companies with registration dates from the relevant period under current practice. We also normally have companies incorporated this year, last year and the year before, with an opened bank account and paid-up share capital, suitable for different business activities.

For a modern international holding structure, we recommend a standard AG or GmbH with clear management, accounting and real presence in the selected canton. Such a company may own subsidiaries, receive dividends and use the participation deduction when the required conditions are met.

As a rule, the amount of tax actually paid by a Swiss company was historically often stated as not exceeding CHF 3,000 per year even with substantial turnover. On that basis, differences between cantonal rates were treated as less important where the company did not conduct business in Switzerland and all income and expenses arose from foreign sources.

Otherwise, if you are not an EU or US citizen, you may face difficulties opening a bank account in Switzerland and passing the bank’sKYC procedures, which Swiss bankers also apply.

Under the conditions described in the original material, dividend payments may be unattractive because the total tax burden when bringing them into Switzerland may reach up to 50% — see more details in“About Dividends”. In many cases, taking into account the tax systems of former USSR countries, investors (owners) of a holding decide not to distribute dividends from companies owned by the holding and instead direct the funds to reinvestment or other purposes.

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