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Business Management
David Merz | Founding Partner
Zurich, September 20, 2023
There are many reasons why you may want to move your business to another country, and Switzerland has long been an attractive choice. Switzerland is an international financial hub known for its business-friendly environment, low taxes, and high quality of life, along with a host of other advantages for companies looking to relocate. In this article, we will explore some of the reasons why you should consider relocating your company to Switzerland and discuss various factors to consider before making the move.
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The world of business is full of surprises, both good and bad. Whether you are looking to move your business due to some unexpected obstacles in your home country, or to take advantage of new opportunities elsewhere, there could be plenty of good reasons for doing so. Some natural reasons to relocate your business to another country include:
We have discussed some good reasons for wanting to relocate a business to another country, but the next question is: Why Switzerland?
Switzerland is an ideal location for relocating your business due to the myriad advantages it offers. Let’s explore some of the main benefits, along with some potential downsides:
While it offers numerous advantages, it’s important to also consider the potential drawbacks of relocating your business to Switzerland:
When we talk about “moving your company” to Switzerland, it actually involves forming an entirely new corporate entity. Switzerland has its own corporate regulations and types of registered entities, so it is generally not possible to just transfer the registered location of a company from abroad to Switzerland.
Aside from moving your entire company to Switzerland, there are two other common ways to achieve a presence in Switzerland for your business.
Instead of shutting down your existing company when forming a new entity in Switzerland, you can simply incorporate a subsidiary business. This means that the original company remains operational as the “parent company” and you create a separate legal entity in Switzerland which operates as a subsidiary of the parent.
A subsidiary company is legally distinct from the parent company, and therefore provides a level of autonomy and limited liability. However, it is still connected to the parent company through some level of ownership and control. The parent company typically holds a significant share of ownership in the subsidiary, usually more than 50% of its shares.
This option is ideal if you are looking to gain a significant corporate presence in Switzerland without shutting down your existing business in your home country.
A branch retains the legal identity of the parent company and is an extension of its activities. In other words, you can open a branch office in Switzerland without needing to create a new legal entity or discontinue your operations in your home country. This also means that the parent company is fully responsible for the branch’s operations, debts, and obligations, whereas this is not necessarily the case for a subsidiary.
Opening a branch office in Switzerland can be a good move if you are just seeking some exposure and contact to the Swiss market, without making any significant changes in your current business situation nor having to go through the administrative burden of creating a new legal entity abroad.
Calculate the costs of your company incorporation here.
So, you’re pretty sure that Switzerland is the ideal location for relocating your business. However, before making the move, you need to consider the following important factors:
It is essential to have a thorough understanding of Swiss laws and regulations related to company incorporation, employment contracts, withholding tax, import duties, and intellectual property rights, among others. This is where it helps to have the guidance and support of an expert in Swiss company corporation, such as Nexova AG.
Switzerland has an overall attractive tax regime, but it’s important to understand it’s finer nuances. Switzerland has a multi-tiered tax system which includes federal, cantonal, and municipal taxes. Research the tax implications for your specific industry and business structure in the different cantons you are considering so as to ensure compliance and minimise tax liabilities.
Depending on your current nationality, you may need to obtain a residence permit or have special permission to open a company in Switzerland. Typically, European Union and European Free Trade Area (EU/EFTA) nationals can move to Switzerland and set up a company almost as easily as Swiss nationals, as they benefit from the Agreement on the Free Movement of Persons.
However, foreign nationals moving to Switzerland from a country outside of the EU/EFTA are categorised as “third-country” nationals, which results in stricter requirements and visa restrictions for setting up a company in Switzerland. In this case, you need to either have a valid C residence permit or be married to a Swiss resident or citizen. You will also need to fulfil other requirements such as being able to demonstrate that your business will have a lasting positive impact on the Swiss labour market, along with obtaining the necessary permission from your local cantonal authority to open a company.
Refer to our dedicated article for more information on setting up a company in Switzerland as a foreigner.
The choice of legal form is one of the most important decisions you will make when moving your business to Switzerland. The legal form of a business impacts everything from governance and liability to capital requirements and tax obligations. Depending on the size and nature of your business, you would typically choose one of the following company forms in Switzerland:
For a more detailed description of each of these legal forms and how to choose the right one for your business, refer to our comprehensive comparison of legal forms in Switzerland.
Each canton within Switzerland offers a different business environment, as well as sets its own cantonal tax rates and incentives. For example, the canton of Zug is a favourite choice for tech and financial startups in Switzerland due to its low corporate taxes, favourable regulations, and openness to innovation.
With the help of a professional advisor, choose a canton that aligns with your company’s requirements and aims. Read our more detailed discussion on which is the best canton for founding a company in Switzerland.
Easily calculate the costs of your company incorporation here.
The decision to move your business to a different country is by no means an easy one, but Nexova AG is here to assist you at every step of the way. We understand the difficulties and complexities involved in relocating your company to Switzerland. With our deep understanding of Swiss regulations and the intricacies of the Swiss business environment, we can help ensure a smooth and successful transition.
We provide comprehensive support, addressing legal considerations, taxation, and the selection of the right legal form and Swiss canton for your business. Trust our expert guidance to help you unlock the full potential of Switzerland’s dynamic corporate landscape.
Contact us today to find out more about how we can help you position your business for lasting success in Switzerland!
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