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Switzerland

Introduction

Switzerland is a mountainous Central European country, home to numerous lakes, villages and the high peaks of the Alps. The country is situated in Western-Central Europe.

Switzerland, officially the Swiss Confederation, is a federal republic in Europe. It consists of 26 cantons, and the city of Bern is the seat of the federal authorities.

The total area of Switzerland is 41, 285 km2

Population

The Swiss population of approximately over eight million people is concentrated mostly on the plateau, where the largest cities are to be found: among them are the two global cities and economic centres Zürich and Geneva.

Language

Switzerland has four official languages: principally German (63.5% total population share) in the eastern, northern and central German region (Deutschschweiz); French (22.5%) in the western French part (la Romandie); Italian (8.1%) in the southern Italian area (Svizzera italiana); and Romansh (0.5%) in the south-eastern trilingual canton of Graubünden.

The federal government is obliged to communicate in the official languages, and in the federal parliament simultaneous translation is provided from and into German, French, and Italian.

Political Structure

Switzerland is comprised of the federal state and 26 cantons, which are member states of the federal state. Political and administrative responsibilities are divided among the federal, cantonal and municipal levels of government. Each canton has its own constitution, code of civil procedure and chamber of parliament.

There are three main governing bodies on the federal level: the bicameral parliament (legislative), the Federal Council (executive) and the Federal Court (judicial).

Federal legislative power is vested in the Federal Council and the two chambers of the Federal Assembly of Switzerland and Switzerland become a stable and reliable political environment.

Economy

Located at the center of Europe, Switzerland has close economic ties with the EU and largely conforms to the economic practices of the EU, even though it is not an EU member. Switzerland is a member of the OECD, the World Trade Organization (WTO) and the European Free Trade Association. It has a free trade agreement with the EU.

Switzerland is one of the most developed countries in the world. Switzerland ranks at or near the top globally in several metrics of national performance, including government transparency, civil liberties, quality of life, economic competitiveness, and human development.

Currency

Swiss franc (CHF)

Exchange Control

Switzerland does not have foreign exchange controls.

There are no distinctions between resident and nonresident accounts, and no limitations on borrowing from abroad. Likewise, local borrowing by foreign-controlled firms from banks and related (or unrelated) companies is freely permitted.

Financial services industry

The Swiss banking system remains among the world’s strongest, boosted by continued efforts to adapt to market conditions and by a currency - the Swiss franc - that generally remains stable.

Swiss banks are responsible for their own lending practices, which are monitored by the Swiss Financial Market Supervisory Authority (FINMA).

Switzerland has committed to implement the automatic exchange of financial account information according to the OECD’s Common Reporting Standard (CRS).

Zurich is Switzerland’s largest financial center, and Geneva is one of the world’s most important centers for private banking.

Corporate Law/Act

Type of Company/Corporation

We provide an Switzerland Incorporation Services with the type Limited Liability Company (GmbH).

Business Restriction

All companies trading in Switzerland must be registered in the Register of Commerce of the district where their registered office or place of business is located. In Switzerland, business entities are governed by the Federal Law, written in the “Code des Obligations” and, unless suitably licensed, a company incorporated in Switzerland cannot undertake the business of banking, insurance, assurance, reinsurance, fund management, collective investment schemes, or any other activity that would suggest an association with the banking or finance industries.

Company Name Restriction

The company name must end with GmbH or Ltd liab.Co. We will check the availability of your proposed company name. Swiss company names should not resemble any other company name registered with the Swiss Federal Commercial Registry.

Company Information privacy

Upon incorporation director and shareholder registers must be filed at the Commercial Registry, but are not available for public inspection. Furthermore, these registers do not have to be kept up to date with any subsequent changes to company directors or registers.

All GmbH need to publicly disclose its shareholders.

Incorporation Procedure

Just 4 simple steps are given to Incorporate a Company in Switzerland:

  • Step 1: Select basic Resident/Founder nationality information and other additional services which you want (if any).
  • Step 2: Register or login and fill in the company names and director/ shareholder(s) and fill in billing address and special request (if any).
  • Step 3: Choose your payment method (We accept payment by Credit/Debit Card, PayPal or Wire Transfer).
  • Step 4: You will receive soft copies of necessary documents including: Certificate of Incorporation, Business Registration, Memorandum and Articles of Association, etc. Then, your new company in a Switzerland is ready to do business. You can bring the documents in company kit to open corporate bank account or we can help you with our long experience of Banking support service.

* These documents required to incorporate company in Switzerland:

  • Passport of each shareholder/beneficial owner and director;
  • Proof of residential address of each director and shareholder (Must be in English or certified translation version);
  • The proposed company names;
  • The issued share capital and par value of shares.

Compliance

Capital

The minimum share capital for a limited liability company and minimum paid up (GmbH) is CHF 20,000. Nominal value of shares is CHF 100 minimum.

Share

With ordinary shares. Bearer shares is not authorised.

Director

Minimum one of the director must be resident in Switzerland. The company is required to appoint at least one of the directors must have a local Director who is either resident in Switzerland, or is a Swiss national.

In case you can not provide Local Director from your side, We can utilize our service to satisfy this statutory requirement with government.

Shareholder

At least one shareholder. There are no restrictions with respect to the nationality or the domicile of the shareholders.

Beneficial Owner

Beneficial Owner’s Statement per beneficial owner need to be provided for incorporation in Switzerland.

Taxation

Switzerland enjoys highly tax - efficient, yet reputable holding company regime, perfect for global parent vehicles and IP holding companies.

With an attractive tax system, Swiss companies are often used and are also a symbol of prestige. The Swiss tax system is shaped by the country's federal structure. Companies and individuals are taxed at three different levels in Switzerland:

  • national level (federal taxes)
  • cantonal level (cantonal taxes)
  • communal level (communal taxes)

Corporate tax is levied on federal level at a flat rate of 8.5% on profit after tax. Corporate income tax is deductible for tax purposes and it reduces the applicable tax base, resulting in a tax rate on profit before tax of 7.8%. No corporate capital tax is levied at federal level.

Non - resident companies are subjected to corporate tax on income generated in Switzerland if

  • i) they are partners of a Swiss business
  • ii) have permanent establishments or branches in Switzerland
  • iii) own local property.

Finance statement

Generally, companies incorporated in Switzerland are not required to file annual financial statements. The exception to this is for certain types of company, such as banks, finance institutions, publicly traded companies. For these companies the financial statements must be filed within six months following the end of the reporting period.

Local Agent

Your company need have a company secretary and it is not required local or qualified, but recommend local.

Double Taxation Agreements

Switzerland has signed 53 Double Taxation Agreements in accordance with the international standard, of which 46 are in force, and 10 Tax Information Exchange Agreements, of which 7 are in force as of November 2015.

License

License Fee & Levy

The contribution of capital into a Swiss resident corporation is subject to Swiss issuance stamp duty of 1% on the contributed amount that exceeds CHF 1 million nominal share capital (various exemptions apply, such as in the case of a restructuring, or the contribution of participations or of a business or business unit), and there is a nominal commercial register/notary fee.

Payment, Company return date Date

The tax year generally is the calendar year, unless a company uses a different financial year. Federal and cantonal/communal income tax is assessed each year on income of the current year.

There is combined tax return filing for both federal and cantonal/communal income tax purposes. A self-assessment procedure applies. Federal income tax must be paid by 31 March of the year following the tax year; the due date for the payment of cantonal/communal income tax varies in the cantons.

Companies must present accounts for the current and the preceding financial year to the general meeting of shareholders. Companies listed on the stock exchange or with outstanding bond issues must publish annual and consolidated accounts approved by the annual general meeting and the auditors’ report in the Swiss Commercial Gazette, or must provide such information upon request.

Swiss resident firm must ensure that an annual general meeting (AGM) be held within 6 months of the end of the year;

Swiss resident firms must pay payroll taxes for foreign employees who do not hold a permanent residence in the country.

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