Setting up a company in Switzerland: SA or Sàrl?
If you want to set up a company in Switzerland, the first decision is the legal form. Most foreign entrepreneurs choose between the public limited company (SA, or AG in German) and the limited liability company (Sàrl, or GmbH). Both protect your private assets and both can be owned from abroad. They differ in capital, flexibility and image. This guide compares the two and walks you through the formation steps, the capital deposit, the resident director rule and the issuance stamp duty.
SA or Sàrl: the key differences
Minimum capital
An SA needs a share capital of at least CHF 100,000 (art. 621 CO). A Sàrl needs a share capital of at least CHF 20,000 (art. 773 CO). You can read both rules in the Swiss Code of Obligations.
How much must be paid in at formation
For an SA, at least 20% of the nominal value of each share, and at least CHF 50,000 in total, must be paid in when the company is founded (art. 632 CO). With the minimum capital of CHF 100,000, that means at least CHF 50,000 on day one.
For a Sàrl, the share capital must be fully paid in at formation (art. 777c CO). With the minimum capital, that is CHF 20,000.
Number of founders
A Sàrl can be founded by a single member, who can be a natural person or a legal entity (art. 775 CO). An SA can also be held by a single shareholder.
Ownership and transfer
This is where the two forms differ most in daily life.
- In an SA, shares are transferred by a written contract and the company updates its share register. The shareholders do not appear in the public commercial register.
- In a Sàrl, the assignment of capital contributions must be in writing (art. 785 CO) and, unless the articles say otherwise, approved by the members' meeting (art. 786 CO). The members are recorded in the commercial register.
The Federal SME Portal gives a clear overview of the Sàrl.
Which form should you choose?
As a rule of thumb:
- Choose a Sàrl if you want to start with less capital, you run a small or medium business and you do not plan to bring in many investors.
- Choose an SA if you expect to raise money, plan to sell shares later, want more discretion about who the owners are, or deal with partners who expect an SA.
Neither form is better in general. The right choice depends on your plans for the next few years. If speed or company age matters to you, you can also take over an existing company. Our guide on buying a Swiss shelf company explains how that works and what the 2025 rules allow.
The capital deposit account
The capital is not paid to the founders or to the notary. It is paid into a capital deposit account (also called a consignment account) opened with a bank in the name of the company being formed. The bank confirms the deposit, and this confirmation is part of the formation documents.
The bank releases the funds to the company once it has been entered in the commercial register. From then on, the company can use the money for its business. Our article on the capital deposit account and business bank account covers this step in more detail.
Steps to set up a company in Switzerland
1. Define the basics
Choose the legal form, the company name, the seat (the municipality where the company is based), the purpose and the amount of capital. Check that the name is available.
2. Find a legal address
Every company must have a legal domicile at its seat, meaning an address where it can be reached. If you have no office, a domiciliation provider can give you a c/o address. See our article on the resident director and registered address.
3. Appoint the officers
Decide who will sit on the board of directors (SA) or act as managing officer (Sàrl). At least one person domiciled in Switzerland must be able to represent the company, as explained below.
4. Pay in the capital
Open the capital deposit account, transfer the capital and obtain the bank's confirmation.
5. Sign the deed of formation
The founders sign the formation deed and adopt the articles of association. This is usually done before a notary.
6. Register the company
The documents are filed with the cantonal commercial register. The company acquires legal personality once it is entered in the register. The bank then releases the capital.
7. Complete the follow-up steps
Depending on your activity, register for VAT and social insurance, set up your accounting and open your operating bank account.
The resident director requirement
A Swiss company must be able to be represented by a person domiciled in Switzerland. For an SA, this must be a member of the board of directors or a manager, and this person must have access to the share register (art. 718 para. 4 CO). For a Sàrl, the same rule applies to the managing officers or managers (art. 814 para. 3 CO).
The rule is about domicile, not nationality. A foreign national living in Switzerland qualifies. Shareholders and members can live abroad. If none of the founders lives in Switzerland, you will need to appoint a resident director or manager. This is explained by the Federal Commercial Registry Office in its practice note 2015/1.
Issuance stamp duty
Switzerland levies an issuance stamp duty of 1% on Swiss participation rights, such as shares in an SA and capital contributions in a Sàrl. There is an exemption threshold of CHF 1 million for a formation or a capital increase, according to the Swiss Federal Tax Administration.
In practice, this means that a company formed with the minimum capital, whether CHF 20,000 or CHF 100,000, usually stays within the exemption. The duty becomes relevant if you contribute large amounts of capital. Ask a fiduciary to check your case.
What does it cost overall?
Apart from the capital itself, which remains the company's money, plan for notary fees, commercial register fees, possible domiciliation and resident director fees, and the cost of a fiduciary for the formation and the first year of accounting. Prices vary by canton and provider, so ask for several quotes.
This article is general information. It does not replace legal or tax advice for your specific situation. DealPME does not give legal or tax advice.