Choice of legal form

Sooner or later, anyone wanting to set up a company is confronted with the tricky question regarding the choice of legal form for the enterprise. This choice is critical, as it has legal, economic and tax consequences that need to be thought through in advance. The choice of legal form is a major decision that should only be taken after careful consideration, as any later modification entails both major costs and tax consequences.

All the same, it is important to realise that there is no such thing as the ideal legal form that minimises risks, guarantees complete independence and provides the maximum tax advantages. Consequently, the thing to do is select the type of company that best serves the needs of the commercial project.

Swiss law provides for several options when selecting the legal form of an enterprise. As a general rule, a distinction is made between unincorporated and incorporated firms, each of which has its own advantages and disadvantages.

Unincorporated firm

There are four types of unincorporated firm:

This type of legal form is very cheap to set up, but the company founder and any associates have unlimited liability on all their assets.

Incorporated firm

There are two types of incorporated firm:

These are more expensive to set up, but the owner's liability is limited to the amount of his participation in the capital stock.

In order to make a decision built on the best possible foundation, you are recommended to seek the advice of experts. The association of notaries working in Vaud and the Vaud section of the Swiss Fiduciary Association are in a position to advise anyone interested in setting up their own business. 


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