Switzerland Offshore Company And The Type Of Organization Structure They Can Assume

Any company which does not perform any substantial business in the country where it has been incorporated is known as an offshore company. They may also be termed as non resident companies. A Switzerland company is any non-resident company running from the territory of Switzerland.

All business entities in Switzerland are governed by a civil code. The civil code may be at a federal level but the various organizations are governed by a particular canton. Every canton maintains a particular register known as the Registre de Commerce. Entries of the organizations in these registers are a must.

The term 'offshore' is not used by the Swiss legislators. Stock Corporation is the term used for various businesses and their legal entities. The foreign investors may prefer various forms of these stock corporations depending upon their organizations and tax benefits.

The holding company is a Stock Corporation which has reduced corporate income taxes and has both capital gains from federal and state (canton) level. They also have a reduced net worth in tax in the state level. The Domiciliary company is a stock corporation which is completely foreign controlled and managed from the mother corporation abroad. They only have a registered office, which is preferably a law firm, in Switzerland.

These organizations must carry out most of their business abroad and only receive income from a foreign source. The characteristic of such a company in Switzerland is a huge savings in corporate income tax and also have capital gains on tax.

An auxiliary company is a type of Domiciliary organization. These companies are able to carry out a portion of their business in Switzerland but are only possible in seven states of the Swiss federation. They cannot enjoy benefits at the federal level.

This type of business organization can appoint Swiss personnel and can have a Swiss income, that is being taxed in a normal rate but the majority of the income must be from a foreign source.

Service companies are Stock Corporations who provide support and service to the foreign companies in the form of technical, financial, administrative or other business avenues. They have to be a part of the group of the foreign organization. These organizations cannot have any income from companies outside the group.

The mixed company has characteristics of both Holding and Domiciliary companies. However, they cannot qualify to be either of them as they have no benefits in the federal level. They can only have tax relaxations at the cantonal level when they meet all the criteria asked of them.

Foreign companies can go for any of the above mentioned type of Switzerland offshore company and procure considerable tax benefits.