Canton Zug is chosen by many investors because of the low taxes applied here - the lowest taxes in Switzerland.
For example, here are the rates perceived in 2011: a deductible tax on income and wealth of 8.5%, a withholding tax on dividends of 35% (lower if the country where the payment is made is part of a Double Taxation Agreement) and a VAT tax of 8%, not payable for export of goods and services.
There are many types of companies that an entrepreneur may choose to open in Zug and the most popular are the companies limited by shares and the joint stock companies.
A limited by shares company, the GesellschaftmitbeschränkterHaftung (GMBH), has its capital divided into shares, with a minimum value of 100 CHF and with the liability of its members limited by the deposited capital. Its representation is made by a Swiss resident. The minimum share capital of 20,000 CHF must be paid at registration.
The management of such a company is made by the General Meeting of the Shareholders, the Swiss Management body and the auditors.
It is the most selected form of business in Zug. The reason is the small amounts of money necessary to open it and the possibility to transform it very easily into the second form of business chosen by investors, the joint stock company.
A joint stock company in Zug requires a minimum share capital of 100,000 CHF, payable in two trances: one at registration and the other one after starting the business. The management of such a company is assured by the General Meeting of the Shareholders, the Board of Directors and the auditors.
The registration procedure requires that the following documents are deposited at a notary: the articles of association, a confirmation from a bank that the minimum share capital was deposited and mandatory the following documents (if available): a statement of mandate acceptance by an auditor and if the company doesn’t have its own office, a domicile acceptance declaration.
The registration with the Commercial Register is necessary for every business so the above notarized documents must be accompanied by a standard application and the proof of a unique name and deposited (usually by the notary) at the Commercial Registry.
During this process, the share capital deposited in the bank remains blocked and stays like this until the bank receives an extract from the Commercial Register, stating that the company is registered there.
The whole process takes from five days to three weeks, depending on the size of the company or the correctness of the documents.
If the annual turnover is expected to be higher than 80,000 €, then the VAT registration is mandatory.
The foreign companies may choose to open branches in Zug, more advantageous than opening local companies, due the fact that there is no need to deposit a minimum share capital at registration and the responsibility for its actions is taken by the foreign parent company.
The documentation for establishing a branch in Zug is much vaster. Here are the required documents: an evidence of the existence in the foreign country of the parent company, the certificate of registration, the articles of incorporation, a list with the managers and their responsibilities, the decision of registering a branch, the name of the branch and address, its goals of it, the decision of naming the representative and his powers.