Setting up a holding company is a great way to manage assets and limit the financial and legal liabilities of child companies and the parent company. There are many options for setting up a holding company. However, many organisations have discovered the advantages of establishing a holding company in Switzerland.
If your business is expanding and you are looking for ways to improve your future financial security, explore the advantages of setting up a holding company in Switzerland.
Receive Lower Federal Tax Rates
The primary reason for establishing a Swiss holding company is to enjoy reduced tax liabilities. To be recognised as a holding company in Switzerland, the company cannot conduct any business in Switzerland and must meet a couple of other regulations. If these details are met, the holding company will have lower tax payments.
The Federal corporate income tax rate in Switzerland is 8.5%. However, a 7.8% tax rate may be applied with a deductible tax payment.
This requires the holding company to hold at least a 20% share of another legal entity or company, or own shares of another company valued at least two million Swiss Francs. When these requirements are met, the holding company pays a reduced tax for corporate income taxes on earned dividends.
Receive Lower Capital Tax Rates
Along with lower Federal tax rates, you will get lower capital tax rates. The typical annual capital tax rate for holding companies in Switzerland is between 0.01% and 0.2%.
There are 26 cantons in Switzerland and each canton has their own taxation regimes. However, holding companies do not pay income taxes at a cantonal level. The canton of Zug offers the best rates due to its low tax status. It is a business-friendly region, with 25% of holding companies in Switzerland registering in Zug.
Receive Help Establishing a Holding Company
You can also receive assistance in setting up your holding company in Switzerland. There are businesses that are dedicated to helping with company formation. They can assess your business and your goals to help determine if a holding company is a right solution. They can also offer advice to ensure that you receive the lowest tax liabilities possible for your company.
There are many reasons to establish a holding company. You can limit the financial and legal liability of multiple companies or restructure your business into several entities controlled by a parent company. While these are great reasons to form a holding company, you get even more advantages when you form the company in Switzerland.
Establishing a holding company in Switzerland is the perfect way to reduce tax liabilities. While there are several countries in Europe that offer low taxes for holding companies, Switzerland is the best country for tax benefits.
If you want the lowest tax burden for your business, work with an experienced agency that helps with company formation to advise you in setting up a holding company. These companies can assist with every step of setting up your company in Switzerland and determining which tax benefits you will receive.