What Makes a GmbH Different from Other Legal Forms
A GmbH is particularly suitable for founders who want to protect their private assets. Unlike a sole proprietorship, you are generally not personally liable for the company’s debts and obligations. Liability is instead limited to the company’s assets and share capital.Contrary to what many people assume, you do not need several shareholders to establish a GmbH. A GmbH can be founded by just one person. The only requirements are that at least one person authorised to represent the company is resident in Switzerland and that the full share capital of CHF 20,000 is paid in.
However, these advantages come with a number of additional requirements. The formation must be notarised, registration in the Commercial Register is mandatory, and the GmbH is subject to statutory bookkeeping and financial reporting obligations. If these steps are properly prepared, the formation process can usually be completed within a few days.
Checklist: How to Set Up a GmbH in Zug
1. Check Whether a GmbH Is the Right Legal Form
A GmbH is often the right choice if a sole proprietorship does not provide enough protection, while an AG would be unnecessarily complex for your business plans. With a sole proprietorship, you are generally personally liable, whereas with a GmbH the risk is limited to the company’s assets. At the same time, the required share capital of CHF 20,000 is considerably lower than the capital required to establish an AG.
However, a GmbH also involves additional obligations, including registration in the Commercial Register, proper bookkeeping and, unlike a sole proprietorship, participation in occupational pension provision (BVG) once the statutory requirements are met.
If you are deciding between an AG and a GmbH, you should primarily compare liability, capital requirements and the participation rights of shareholders. In particular, if you are considering setting up an AG in Zug, it is worth comparing the two legal forms directly.
2. Choose a Company Name
Your company name forms part of your business identity and will be used in the articles of association, the Commercial Register and your day-to-day business activities. In principle, you are free to choose the name as long as it is sufficiently distinct from existing companies, is not misleading and does not conflict with public interests. The suffix “GmbH” must form part of the company name.
Before setting up your company in Zug, it is advisable to:
request a preliminary check from the competent Commercial Register Office;
search the central Commercial Register to avoid confusion with existing companies;
check whether the desired domain name and relevant social media usernames are still available;
carry out a trademark search if you want to protect your company name in the long term.
3. Provide the Share Capital
To establish a GmbH, you need share capital of at least CHF 20,000, which must be paid in full. For this purpose, you open a capital contribution account with a bank. The bank confirmation issued after the funds have been deposited will later be required for the notarised formation of the company.
4. Prepare the Articles of Association and Formation Documents
Before an appointment with the notary can be arranged, all formation documents must be complete. These include the articles of association, information about the shareholders and management, as well as the bank confirmation showing that the full share capital has been paid in.
If the GmbH in Zug does not have its own business premises, you will also need a domicile acceptance declaration from the provider at whose address the company will be registered.
If an auditor is appointed, the audit firm must confirm in writing that it accepts the mandate. The documents are sent to the notary in advance so that the deed of incorporation can be prepared for notarisation.
5. Establish the GmbH Before a Notary
The formation of a GmbH in Switzerland must be officially notarised. During the appointment, the formation documents are reviewed and the deed of incorporation is notarised. Only after this step can the application for registration in the Commercial Register be submitted.
6. Register the Company in the Commercial Register
After notarisation, the GmbH is registered with the competent Commercial Register Office. Once the company has been entered in the register, it legally comes into existence as an independent legal entity.
The paid-in share capital can then be released and used for the company’s business activities.
7. Organise All Ongoing Obligations After Formation
Once the GmbH has been entered in the Commercial Register, the company has been legally established and you can begin business operations.
You should set up proper bookkeeping as early as possible and take care of the necessary registrations with the social insurance authorities. VAT registration is generally only mandatory once annual turnover reaches CHF 100,000. You can check whether your company is subject to VAT on the website of the Swiss Federal Tax Administration and register directly there if necessary.
You should allow approximately one to two weeks for the entire formation process. Preparing the formation documents usually takes between one and five days, while registration in the Commercial Register often takes another three to seven days.
Support with Setting Up Your GmbH in Zug
Setting up a company involves much more than completing forms or visiting a notary. For many people, it marks the transition into self-employment, the beginning of a family business or the realisation of a business idea they may have been developing for years. This makes it all the more important to make the right decisions from the very beginning.
As an experienced fourth-generation business law firm, Jost & Partners supports you in establishing your GmbH or AG in Zug – from choosing the right legal form and preparing the formation documents to registration in the Commercial Register.
If you require
international tax advice in Switzerland or are deciding between a GmbH and an AG, we can also help you structure your company in a legally compliant manner.
