Setting up a company in Switzerland: legal form, commercial register, insurance and pension

Which legal form suits your company?

Most founders in Switzerland choose between a sole proprietorship, a GmbH (limited liability company) and an AG (public limited company). The deciding factors are liability, capital requirements, tax, social security and your plans for the coming years – for example whether you want to take on partners, hire employees or bring in investors later.

• Sole proprietorship: easy to set up, but you are liable with your private assets
• GmbH: liability limited to the company's assets, share capital of at least CHF 20,000
• AG: share capital of at least CHF 100,000, of which at least CHF 50,000 paid in
• General partnership: for several people, without separate legal personality

Tax and social security by legal form

With a sole proprietorship, the profit is taxed together with your other income, and you pay AHV contributions as a self-employed person. With a GmbH or AG, the company pays profit and capital tax; you yourself are usually employed and pay tax on your salary and any dividends.

The profit level at which a corporation pays off depends on the canton, your personal situation and your plans. We calculate the options with your figures before you commit.

Setting up a GmbH in Switzerland: the process

A GmbH is formed in a few clearly defined steps. If the preparations are thorough, the formation usually goes smoothly:

• Check the company name and define the purpose
• Draft the articles of association and appoint the management
• Pay the share capital into a capital deposit account at a bank
• Have the deed of formation publicly notarised
• Register with the commercial register of the canton where the company has its registered office
• After registration: the capital is released and the GmbH has legal capacity

AG and formation with contributions in kind

An AG is formed following the same pattern, with share capital, a board of directors and a share register. For contributions in kind – for example if you bring in an existing sole proprietorship, vehicles or machinery – additional reports and audits are required. These cases should be planned early.

How much does it cost to set up a GmbH?

Besides the share capital, which remains with your company, there are fees for the public notarisation and the commercial register and, depending on the bank, for the capital deposit account. The amount depends on the canton, the notary and whether the formation is in cash or in kind. On top of this come costs for advice, bookkeeping and your first insurance policies.

We show you upfront what total costs to expect and offer our support at a fixed price.

Commercial register: when is registration mandatory?

A GmbH or AG only comes into existence once it is entered in the commercial register. A sole proprietorship must be registered as soon as its annual turnover reaches CHF 100,000; below that, registration is voluntary. Registration makes your company publicly visible and protects the company name within the limits of the law.

AHV and VAT: registrations after formation

As a sole proprietor, you register with the compensation fund as self-employed. The compensation fund checks whether you are recognised as self-employed – important if you work mainly for a small number of clients. With a GmbH or AG, the company registers as an employer, even if you are initially the only employee.

You become liable for VAT as soon as your turnover from taxable supplies reaches CHF 100,000 a year. Registering voluntarily can make sense if you have high investments and want to reclaim input tax.

Insurance and pension provision from the start

With your first employee – even if that is you in your own GmbH – you need accident insurance under the UVG. Above a certain salary, the pension fund is added. Daily sickness allowance and business liability insurance are not mandatory everywhere, but belong in most formation plans.

As a sole proprietor, by contrast, you are not automatically insured against accidents and have no pension fund. Without your own solution, you bear the risk of accident, illness and disability alone. Depending on your situation, voluntary accident insurance, daily sickness allowance and voluntary occupational pension provision or pillar 3a for the self-employed without a pension fund make sense.

Many founders invest everything in the company in the first few years and neglect their own pension provision. How much you draw as salary and how much as dividends also has consequences for AHV, the pension fund and tax. We plan this together with you.

Common mistakes when setting up a company

These issues cost founders the most time and money later on:

• Legal form chosen solely on the basis of formation costs
• Accident insurance only taken out after the first working day
• VAT liability recognised too late
• Business and private accounts not kept separate
• Own cover for illness and disability forgotten

How PROFINIO supports your formation

We draw up a formation roadmap with you, coordinate the steps with the notary, the bank and the commercial register, and take care of registration with the compensation fund and for VAT. We set up insurance and pension provision in parallel so that you are covered from day one. After formation, we remain your contact for bookkeeping, payroll, tax and insurance.

Frequently asked questions