Blog: Accounting, Tax & Business Tips

February 21, 2024 | David Merz

Net Tax Rate Method

When calculating and declaring VAT in Switzerland, not all businesses have to use the standard effective billing method. For small and medium-sized enterprises (SMEs), the net tax rate method offers a simplified alternative. Instead of separately calculating input and output tax, VAT is settled using a flat percentage of total turnover. In this article, we explain how the net tax rate method works, who can use it, and what the rules are in 2026. We also look at the advantages and disadvantages of this approach, with practical considerations to help you decide whether it’s the right fit for your business.

December 26, 2023 | David Merz

Statutes of a Company: Understanding the Legal Framework for GmbH and AG

The backbone of a well-structured company is its statutes, or “articles of association”. These crucial founding documents establish the internal rules by which any company in Switzerland operates and guides its purpose. Drafting them for the first time or making a later alteration calls for the utmost care and expertise. In this blog, we provide a comprehensive explanation of what these statutes are and what information they should include. We also explore in detail what it takes to make changes to a company’s statutes after it has been incorporated.

December 24, 2023 | David Merz

ANobAG: How to deal with social security contributions?

In an increasingly globalized world where “employment borders” are dissolving, more employees in Switzerland have foreign employers. There is nothing fundamentally illegal about employment arrangements like this, yet they do create additional complexities surrounding labor law and social security. In this blog, we explore these issues in depth, specifically how to deal with social security contributions for these types of employees, who are also known as ANobAG.

December 24, 2023 | David Merz

Capital Deposit Account: Which Bank Should You Choose?

Setting up a limited liability company (GmbH) or Stock Corporation (AG) in Switzerland comes with various legal and financial requirements. One of the most basic of these is the formation of a special capital deposit account in which to pay the minimum registered share capital of the company during the incorporation process. This article explores the intricacies of capital deposit accounts, how the deposit process works in practice, it’s associated costs, and most importantly, how to choose the right bank for opening a capital deposit account in Switzerland.

December 24, 2023 | David Merz

Founding a Company with Contributions in Kind

When incorporating a new company in Switzerland or converting a sole proprietorship into an AG or GmbH, it is possible to fulfil the capital requirements with contributions in kind instead of a cash deposit. This is useful for those with existing and useful assets but limited free capital. In this article, we explore the practicalities of this process. We explain what is meant by a contribution in kind and what types of assets qualify, how to value these assets, and the requirements and costs for establishing contributions in kind when incorporating a new company.

December 23, 2023 | David Merz

Partial Taxation of Dividends in Switzerland

Partial taxation of dividends in Switzerland offers a welcome respite from the economic burden of double taxation. In this article, we discuss the issue of double taxation of dividends and the solution of partial taxation implemented in 2009, as well as the adjustments brought about by the STAF initiative in 2020. We provide insights into eligibility criteria, methods of partial taxation, and other key considerations. We also explain the importance of seeking expert guidance when navigating the intricacies of taxation of dividends while staying compliant.

December 22, 2023 | David Merz

Part-Time Self-Employment in Switzerland: The Essential Aspects

The idea of part-time self-employment has gained significant traction in recent years, especially in progressive countries like Switzerland where a flexible and dynamic workforce is valued, and workers are encouraged to explore their entrepreneurial passions. In this article, we delve into the fundamental aspects of part-time self-employment in Switzerland, exploring what it entails, who can become self-employed part-time, its advantages and disadvantages, important legal considerations, and common questions you might have about this interesting mode of work.

November 7, 2023 | David Merz

Salary or Dividends for the Owner of a Company: How to Optimise Remuneration

The owner of a GmbH or AG is always faced with the important question of how best to optimise the income they receive from their company. The issue primarily comes down to deciding on the balance between salary and dividends. This is a pivotal decision with implications for personal income, social security, and tax efficiency. In this article, we explore the considerations and consequences involved in this choice, and what is practically permissible in the efforts to optimise taxes.

November 7, 2023 | David Merz

Use of Profits by Legal Entities

The allocation and distribution of profit is a crucial aspect of any business operation. Companies need to balance various needs while fulfilling specific legal requirements. This article explores the intricacies of profit distribution in Switzerland for both the GmbH and AG entities. We discuss the different ways that profits can be used and what to consider when deciding which of these uses is optimal. We also outline the importance of creating a comprehensive profit distribution plan and how to practically go about allocating profit.

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