Opening a branch in Switzerland: registration, costs and tax

Branch or subsidiary: what is the difference?

A branch, called a succursale in French and a Zweigniederlassung in German, has a degree of economic independence but legally remains part of the main business. A representative office without that autonomy may be classified differently.

A subsidiary is a separate company whose capital is wholly or partly owned by a parent. A parent does not own shares in its own branch.

Do not choose on incorporation cost alone. A separate subsidiary may better fit a need to separate risks or admit a local investor. Compare Swiss LLC and SA structures if you take that route.

Conditions to address before registration

Define the actual Swiss activity, address, available resources and responsible people. Commercial-register entry does not replace suitable premises or any required professional permissions.

For a foreign business, at least one person authorised to represent the branch must reside in Switzerland and be entered in the commercial register. The signing arrangement must enable the required representation. A registered-office address alone is a different matter.

The business name must correctly identify the main business and branch. The register checks the wording, including the rules applicable to a foreign head office.

If you will employ people, address work permission, social insurance and employer registration and payroll obligations. Being entitled to own a business does not automatically authorise someone to work personally in Switzerland.

Documents for a Swiss or foreign head office

Swiss main business

Prepare the competent corporate body’s branch-opening decision, representatives and signing powers, address and registration application. Information already registered at the head office may affect the documents required. Use the receiving canton’s official checklist.

Foreign main business

Add evidence of the main business’s existence and organisation: foreign register extract, articles, branch-opening resolution and appointments. Apostilles or legalisation and translations may be required.

For example, Vaud requests an original register extract less than six months old with apostille and French translations of foreign-language documents. Confirm requirements for the relevant country and canton before ordering documents; this is not a universal checklist for every case.

For a c/o address, obtain the domiciliation provider’s declaration. Check that names, dates and signing arrangements agree throughout the file.

Steps to establish the branch

1. Compare structures: assess whether a branch or a separate company suits the project.
2. Validate the location: confirm activity, premises, representation and permits.
3. Approve the opening: the main business records the decision and delegated powers.
4. Collect evidence: allow time for foreign documents, translations and legalisation.
5. File the application: submit to the commercial register where the branch is located using an accepted channel.
6. Organise operations: prepare banking, accounting, tax, payroll and invoicing.

There is no universally guaranteed completion time. Foreign documents, additional-information requests and bank checks can extend the timetable. Prepare the business bank account in parallel without confusing bank approval with register acceptance.

A branch normally does not require the incorporation deed of a new SA or LLC, although authenticated signatures and documents may still be required.

How is a Swiss branch taxed?

For a foreign enterprise, Swiss operations can create a limited tax liability for the items attributable to a permanent establishment. Domestic law and the applicable double-tax treaty govern allocation. Geneva’s legislation provides for taxation of profit and capital attributable to the cantonal establishment.

For a Swiss business operating in several cantons, the issue is intercantonal allocation. The head-office address does not eliminate taxable activity elsewhere.

Example: a foreign company places a sales and operations team in Geneva. Assess the functions, contracts, risks and costs attributable to that establishment. Its entire worldwide profit is not automatically taxable in Geneva; equally, invoicing from the foreign head office does not automatically prevent Swiss taxation.

A remittance from a branch to its head office is not inherently a dividend between two separate companies. Assess each flow on its facts. The word “branch” alone does not establish a tax saving.

Accounting and VAT from day one

Even without separate legal personality, records must identify the branch’s income, expenses, assets and dealings with the head office. This supports reporting and tax allocation.

Agree who records invoices, how central costs are allocated and which currency is used for reporting. Keep evidence for head-office flows and coordinate Swiss accounting with the main finance team.

VAT has its own framework. The Swiss permanent establishments of the same foreign enterprise are treated together as an autonomous taxable subject. Review the supplies, relevant turnover and cross-border dealings. The absence of separate legal personality does not make every overseas internal flow irrelevant for VAT.

The general Swiss VAT registration rules are a starting point; branch arrangements need an assessment of their specific flows.

Compare setup and recurring costs

Allow for commercial-register fees, file preparation, translations and legalisation, banking setup and tax analysis. Then include premises, representation, insurance, accounting and periodic returns.

Ask for separate setup and recurring quotations. A standard LLC formation price should not be presented as the cost of registering a foreign branch.

Before deciding, gather:

• The main business’s documents and country of establishment.
• A description and forecast budget for the Swiss activity.
• Details of the people who will work and sign in Switzerland.
• Expected flows with the head office and customers.
• Plans for investors, a future sale and development.

Use these facts to compare a branch with a Swiss LLC or an SA. Your business plan should reflect the chosen structure’s full running costs.

Frequently asked questions