Switzerland Offshore Company Formation: Swiss AG & S.A.

Switzerland is one of the most notable and prestigious places in the world to form a company. It boasts of having one of the world's strongest and most developed financial and banking systems in the world and nearly 25% of the world's assets in its banks, strong banking secrecy laws, and strong depositor insurance, it's not surprising why companies and capital flock to Switzerland.

Swiss AG Company or "Aktiengesellschaft" which is German for Public Limited Company is governed by the Swiss Code of Obligations that goes back to 1911 and the more recent Swiss Company Act which was updated in 2008.

A Switzerland AG Company is the most popular form of company formation vehicles in Switzerland due to its flexibility and versatility. An AG company needs only one shareholder, who may also be the director and can have an unlimited number of individual shareholders.

A Switzerland Company also goes by the name Swiss Société Anonyme S.A. and is used interchangeably with AG or PLC.

There are no restrictions in opening up an AG company for foreigners or non-residents, though there are local requirements, such as local meetings (which can be attended by proxy) and local swiss director and office. Though these might put the price higher than your standard cheap offshore tax haven company, but a Swiss Company is worth it.

Overview: Swiss AG / S.A. (Public Limited Company) Formation Process

A Switzerland offshore corporation, commonly structured as an Aktiengesellschaft (AG) or Société Anonyme (S.A.), is a legal entity established in Switzerland that conducts business primarily outside the country. These corporations benefit from Switzerland's favorable tax regime while still adhering to reporting and regulatory requirements.

Swiss offshore companies are characterized by their strong legal protection, confidentiality provisions, and international recognition. Unlike typical offshore jurisdictions, Swiss companies maintain a higher level of legitimacy and prestige in global business circles.

The minimum capital requirement for Swiss AG/S.A. corporations is 100,000 CHF, with at least 50,000 CHF paid up at formation. These entities can issue both registered and bearer shares, though bearer shares have additional compliance requirements.

Historical Context

Switzerland's reputation as a financial hub dates back several centuries, evolving from banking traditions to encompass corporate structures designed for international business operations. The development of the Swiss offshore corporation model gained momentum in the post-World War II era.

During the 1960s and 1970s, Switzerland refined its corporate frameworks to attract foreign investment while maintaining stringent standards of governance. This approach differentiated Swiss offshore structures from those in more permissive jurisdictions.

Over the past decades, Switzerland has adapted its offshore corporate regulations to balance international compliance demands with its tradition of financial privacy. Recent developments include increased transparency requirements and alignment with international tax standards while preserving core benefits that make Swiss offshore corporations attractive.

Swiss Corporate Law

Swiss corporate law recognizes two primary business structures popular with international investors: the Corporation (AG/SA) and the Limited Liability Company (GmbH/Sàrl). The AG (Aktiengesellschaft in German) or SA (société anonyme in French) represents the most common structure for offshore operations.

A Corporation requires minimum capital of CHF 100,000 with at least 20% (minimum CHF 50,000) paid-in at formation. This structure provides robust asset protection by separating shareholders' personal assets from corporate liabilities.

Swiss corporate law offers strong privacy protections while still maintaining compliance with international standards. Unlike traditional offshore jurisdictions, Switzerland combines tax advantages with legitimacy and regulatory stability.

Offshore Company Formation Requirements

Establishing an offshore corporation in Switzerland requires several key elements. Companies must maintain a registered office within Switzerland and appoint at least one Swiss resident to the board of directors or in a management position.

The formation process involves preparing articles of association, depositing the required capital, and registering with the commercial registry. While Switzerland doesn't offer the anonymity of some offshore locations, it provides confidentiality within a respected regulatory framework.

Foreign investors may utilize corporate service providers to handle administrative requirements, including providing resident directors and address services. This approach helps non-Swiss entities meet local requirements while maintaining operational control.

Different types of Company Formation possibilities

• "Gesellschaft mit beschränkter Haftung" (GmbH) – Limited Liability Company (LLC)
• "Aktiengesellschaft" (AG) – Joint Stock Company
• "Zweigniederlassung" – Autonomous or dependent branch foreign entity
• "Kommanditgesellchaft" (KG) – LP
• "Kollektivgesellschaft" (OHG) – General LP
• "Einfache Gesellschaft" – LP w/o registration
• "Einzelunternehmen" – Single Enterprise

Advantages

• Most popular Swiss Company Formation
• Establishing a prestigious Swiss Company is a signature of quality
• Great reputation
• Access to financial and banking instruments
• Opportunities for starting ICO, crypto and blockchain companies
• Foreign Ownership: All the shares can be owned by non-residents
• Names of Shareholders are not listed in the Government Registry
• Minimal taxation, Sug has a 8.5% fixed tax rate
• Access to many DTTs
• Stable political and economic environment
• Nominee directors and shareholders are available for added privacy
• Bearer Shares are  allowed for the privacy of shareholders
• Only one shareholder is required to form a Swiss AG
• Switzerland has a strong financial and banking system
• Strong banking secrecy laws
• Minimum of one director is required, who can also be the sole shareholder

Financial Privacy Laws

Switzerland has long been known for its strong financial privacy protections, although these have evolved in recent years due to international pressure for greater transparency.

Banking secrecy laws still offer protection against unauthorized disclosure of client information. However, Switzerland now participates in automatic exchange of information agreements with many countries to combat tax evasion.

For legitimate business operations, the Swiss financial system continues to offer discretion, security, and professionalism. Companies benefit from a stable banking environment with sophisticated financial services that support international business operations.

The combination of privacy protections and compliance with international standards creates a balanced environment that protects legitimate business interests while meeting global transparency requirements.

Types of Offshore Corporations in Switzerland

1. Holding Companies

Holding companies in Switzerland primarily focus on managing and holding ownership stakes in other companies. These entities benefit from participation exemption, which can significantly reduce or eliminate taxes on dividends received from qualifying subsidiaries.

Swiss holding companies must own at least 10% of another company's share capital or shares with a market value of at least 1 million CHF to qualify for tax benefits. They are particularly attractive for multinational corporations looking to centralize their investment activities.

The main advantages include minimal taxation on dividend income, no federal tax on capital gains from qualifying participations, and access to Switzerland's extensive double taxation treaty network. Many holding companies establish their headquarters in cantons offering favorable tax rates.

2. Domiciliary Companies

Domiciliary companies conduct their business activities exclusively outside of Switzerland while maintaining their legal domicile within the country. These entities have no physical presence beyond a registered office address in Switzerland.

They typically employ no staff in Switzerland and generate no Swiss-source income. Instead, they perform administrative functions related to international operations.

Historically, domiciliary companies enjoyed preferential tax treatment under cantonal tax laws. However, recent tax reforms have modified these advantages to align with international standards.

Despite these changes, they remain attractive for international businesses due to Switzerland's political stability, sophisticated banking system, and professional corporate services. These companies must still maintain proper substance to avoid being deemed artificial arrangements.

3. Mixed Companies

Mixed companies operate both within Switzerland and abroad, with their foreign activities constituting the majority of their business. Typically, at least 80% of their income must derive from non-Swiss sources to qualify for this classification.

These entities maintain a physical presence in Switzerland, including offices and employees, while conducting substantial business activities internationally. They serve as an intermediate option between purely domestic and purely offshore operations.

Mixed companies have traditionally benefited from reduced effective tax rates on their foreign-source income. However, like domiciliary companies, they have been affected by recent Swiss tax reforms aimed at meeting international standards.

Despite regulatory changes, they continue to offer advantages through Switzerland's excellent infrastructure, highly skilled workforce, and strategic European location. Many businesses use this structure to establish regional headquarters that oversee international operations.

Key Corporate Features

*Annual accounts of the AG be audited though an exemption is possible if at least two of the following criteria are met:

• Balance sheets less than 10 million CHF
• Annual turnover is less than 20 million CHF; or
• Number of employees is less than 50

Requirements

 In order to form a Swiss company, the minimum information is required:

• Name of Company
• Physical address
• Valid passport

If opening a personal or corporate bank account there will likely be additional requirements such as professional reference.

How to set up an Swiss Company

The formation of a Swiss offshore corporation typically begins with securing a unique company name through the Swiss Commercial Register. Entrepreneurs must choose between an Aktiengesellschaft (AG) or a Private Limited Liability Company (GmbH) structure, with each offering distinct advantages.

For an AG formation, a minimum capital of CHF 100,000 is required, while a GmbH requires CHF 20,000. At least one director must be appointed, though residency requirements are relatively flexible compared to other jurisdictions.

Documentation requirements include preparing the Memorandum and Articles of Association, which must be notarized. The company must also maintain a registered office address within Switzerland.

After submission of all documents and payment of registration fees, the incorporation process typically takes 2-3 weeks to complete.

In order to see up an Swiss company a few documents will be needed:

1. Register and secure the name of the proposed company
2. Memorandum and Articles of Association
3. Certificate of Incorporation
4. Appointment of a company director(s)
5. Registry of members and directors
6. Share Certificate(s)

Once your company is formed you can open a corporate bank account which will require KYC and AML verification. All of the steps above can be done virtually, except some countries do require physical in-person visits in order to open a bank account. Get in touch to know the details, as this changes regularly. Once all these steps are completed you will have the incorporation documents sent to your physical address. 

Company Registration Process

In order to register a company, this is what the process will look like:

• Step 1 Offshore Protection works with you to secure a company name with the Company Registry
• Step 2 Offshore Protection works with you to get a Memorandum of Association (MOA)
• Step 3 Offshore Protection helps you to prepare and file incorporation documents
• Step 4 Offshore Protection helps to prepare KYC and AML documents needed to open a corporate bank account
• Step 5 Offshore Protection delivers the certificate of incorporation

Corporate Bank Account

You can open a corporate bank account in most countries around the world with an Swiss company. We have banking connections in dozens of countries, though the ones we recommend will be dependent on your situation as some banks require in-person visits, higher capital, more due diligence, and references, while others have minimal requirements.

We suggest getting in touch for a consultation as there are many variables that go into finding the best place to open a bank account for your company.

Taxation

The Swiss Limited Company AG files its own tax return as a separate legal entity or Corporation.

After approval of registration by the Commercial Registry for corporate Tax and VAT identity numbers. The Company must apply to the Federal Tax Administration.

Taxes are payable to the federal government and the canton in which one is registered. Each Canton has different Tax rates. Given below are the federal and canton corporate tax rates and their ranges:

• Direct federal taxes on profits: 8.5%
• Cantonal tax on profits: 5.9% – 16%
• Cantonal tax on capital: 0.05% – 0.3%
• Total tax burden: 14.5% – 25%

The Value Added Tax (VAT) is 8% which is the lowest rate in Europe.

Corporate Details

Anonymity, Confidentiality and Disclosure

Names of Shareholders can be anonymous as names are not listed in the Government Registry. Nominee directors and shareholders are available for added privacy. Issuance of bearer shares are allowed for the privacy of shareholders. Names of Beneficial owners only have to be disclosed confidentially to banks while account opening for KYC  checks. However, the names of directors are part of the public records of the Commercial Registry which are accessible to the public.  

Company Shares

Non-Par Value Shares are not allowed although bearer shares are permitted if the capital is fully paid up.

Required Capital

The minimum share capital required for a Swiss Limited Company (AG) is 100,000 CHF.  At least 20%, but no less than 50,000 CHF has to be paid in cash or in-kind before the company incorporation process.

CHF must be the currency used Issuance of shares above 250,000 CHF is liable for Capital Duty at the rate of 1%

Directors

There needs to be at least one director who must be a local who can also be the shareholder

Shareholders

Only one required and may be the director

Company Secretary

Not required

Company Meetings

Local meetings are required but may be attended by proxy

Principal Corporate Legislation

Swiss Company Act (updated 2008)

Type of Law

Civil Law

Exchange Controls

No exchange controls

Registered Office Required

Yes a local registered office is required

Local Presence

 A local office and a local registered agent is required to fulfill any procedural and statutory activities of the company

Audit Requirements

 Generally only for larger companies meeting any two of the following criteria - CHF 40 Mio Turnover, Assets CHF 20 Mio + or 250 Employees

Annual Reporting

Yes

Financial Statements Required

Yes, a company is expected to maintain annual financial statements including balance sheet, profit and loss account, as well as any inventory account

Shelf Companies available

No, Shelf companies are not available

Time required to form offshore company

1-2 weeks

Permitted limited liability suffixes

Usually, the companies are allowed to choose any name. The only requirement is the addition of “AG” to the name 

Access to Double Tax Treaties

Yes there are 80 DTT signed

FAQ

How does Switzerland regulate offshore corporations?

Switzerland maintains strict regulatory oversight while offering business-friendly policies. Offshore corporations are subject to federal and cantonal laws that ensure compliance with international standards.

The Swiss Financial Market Supervisory Authority (FINMA) oversees financial activities to prevent money laundering and ensure transparency. Switzerland has implemented OECD standards for information exchange, removing it from "tax haven" blacklists.

Companies must maintain proper accounting records and submit annual financial statements. While privacy is valued, Switzerland now participates in automatic exchange of information agreements with numerous countries.

What benefits are offered to offshore corporations in Switzerland?

Switzerland offers significant tax advantages including relatively low corporate tax rates ranging from 11.9% to 21.6% depending on the canton. Holding companies may benefit from participation exemption rules that reduce taxes on qualifying dividend income.

The country's political stability and strong banking system provide a secure environment for business operations. Switzerland has an extensive network of double taxation treaties, preventing dual taxation on international operations.

Swiss corporations benefit from excellent infrastructure, access to skilled workforce, and strategic location in the heart of Europe. The country's reputation for quality and precision adds prestige to businesses registered there.

What is the difference between a Swiss AG company and an offshore corporation?

A Swiss AG (Aktiengesellschaft) is a public limited company that can be listed on the stock exchange and offers shareholders anonymity in public records. An offshore corporation typically refers to a company established in Switzerland but conducting business primarily outside the country.

AG companies require a minimum capital of CHF 50,000 and can issue shares to raise additional capital. They provide greater flexibility for larger operations and international business activities.

Offshore corporations may utilize Switzerland's legal framework while focusing operations elsewhere, often leveraging tax benefits and privacy protections. Both structures benefit from Switzerland's stable political and economic environment.

What are the reporting and compliance obligations for offshore corporations in Switzerland?

Offshore corporations must maintain proper accounting records and file annual financial statements with tax authorities. Companies must submit corporate tax returns at both federal and cantonal levels annually.

VAT registration is mandatory for businesses with annual turnover exceeding CHF 100,000. Companies must hold annual general meetings and keep minutes of these proceedings.

Switzerland has implemented the Common Reporting Standard (CRS), requiring financial institutions to report account information of foreign tax residents. Anti-money laundering regulations require due diligence procedures and verification of beneficial owners.

Can non-residents incorporate a company in Switzerland, and what are the implications?

Non-residents can indeed incorporate companies in Switzerland without being physically present in the country. However, a local director or representative with a Swiss address is typically required.

Non-resident company owners may need to obtain work and residence permits if they plan to actively manage the business from within Switzerland. Banking relationships may require enhanced due diligence for non-resident beneficial owners.

Tax implications vary based on where management decisions occur and where business activities take place. A company incorporated in Switzerland but managed from abroad may still be subject to Swiss corporate taxes on worldwide income.

Can Offshore Protection create a company for me?

Yes, we can! Offshore Protection has been establishing companies around the world for nearly three decades. We have engaged in client legal and corporate services, including opening companies, swiss trust companies, getting financial licenses, and accounts in dozens of countries around the world. Get in touch to find out more.

Switzerland AG SA Company Incorporation with Offshore Protection

Incorporation Packages

Includes:

1. Government Registration Fee (First year)
2. Registered Office Address (First year)
3. Registered Agent Services (First year)
4. Company Secretarial Maintenance
5. Certificate of Incorporation
6. Memo & Articles of Association
7. Appointment of 1st Directors
8. Consent Actions of the BOD
9. Share Certificates
10. Register of Directors
11. Register of Officers
12. Register of Shareholders
13. FREE Phone and/or email consultations

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