Swiss subsidiaries are legal entities with capital partially or totally owned by foreign companies. The fact that the company’s capital is controlled by a foreign company is not conditioning the management of the Swiss company in matters such as the conclusion of new contracts or hiring employees. It may also issue shares and transfer it.
The foreign companies are elaborating the articles of association of the company and issue a decision of opening a subsidiary in Switzerland.
Discover the main particularities of a subsidiary in Switzerland in our scheme:
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No special license is required to perform activities under this form of business, but the registration in the Swiss Companies Register is mandatory.
Subsidiaries are formed as companies with limited liability and may be public or private.
Gesellschaftmitbeschränkter Haftung (GmbH), the limited liability company, must be formed by at least at least two shareholders. They must deposit minimum 20,000 CHF in a Swiss bank account. It’s mandatory for the director to be a resident of Switzerland.
Aktiengesellschaft (AG) is formed by at least three founders who must provide a minimum share capital of 100,000 CHF. The capital cannot be increased with more than a half at one time. Half of this sum must be provided prior registration. The majority of directors must be Swiss residents.
The procedure of registration of such company begins with depositing the minimum share capital and receiving an extract from the bank regarding the financial operation.
Next, the articles of association are drafted in front of a notary, which will notarize the corporate and personal signature from the application.
The notarized articles of association, the decision of incorporating the company in Switzerland and the certificate from the bank must be deposited to the commercial registry. The process takes about 7 days and has as a result the issuing of the registration certificate.There is also a stamp tax at post office or bank after receiving the certificate.
The next step is registering for VAT, if necessary, and the registration of the employees at the social insurance system.
Certain regulations are in favor of the subsidiaries opened in Switzerland. For example the vast network of double tax treaties are regulating the way the withholding taxes on dividends, interests and royalties paid to the treaty country are issued. In most cases, the withholding tax is minimized or even exempt.
The corporate tax on profits is paid only in the country of origin, not in Switzerland, or if an exception is made and it is paid here, a refund is offered.