Employing in Switzerland

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Enter the Swiss market without the requirement of opening a local entity.

Expanding into
Switzerland

Global expansion is a step to make for any business, regardless of what you wish to achieve. The opportunities that can come with an expansion can be both incredibly exciting as well as intimidating and confusing, especially when you consider all of the registration procedures that needs to be done and documentation required.

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Expanding to countries such as Switzerland – which is characterized by a highly productive and qualified workforce, admirable employment and tax laws, a strong infrastructure network linking to the res leading sectors in machinery, chemicals, textiles, tourism, banking insurance, and pharmaceuticals – can bring both excitement to the possibilities, but also significant stress to ensuring the entity with the country’s rigorous legal structures and laws.

Ensuring compliance without the sufficient knowledge of the country’s laws also adds to the stress of getting your new entity off the ground and ready to test new markets. Going at it without the proper support can increase the costs, time and risks involved.

Each new markets bring new challenges, and these can be worked through more efficiently and cost-effectively with the support of an International Professional Employer Organization (PEO) such as Bradford Jacobs, especially through our Employer of Record (EOR) framework.

This can be best utilized when businesses are just beginning their expansion process and require more information before committing to incorporating an entity and fully establishing themselves in that market.

Country EOR Guide - Bradford Jacobs

Download our Guide to Switzerland

Learn all about expanding into Switzerland and see what we can do to make your expansion easier.

Download our Guide to Switzerland

Learn all about expanding into Switzerland and see what we can do to make your expansion easier.

Country EOR Guide - Bradford Jacobs

Hiring Staff
in Switzerland

Hiring Staff
in Switzerland

The Main Sectors of the Swiss Economy

The country focuses on the following key sectors, which all have a significant impact on the country’s economy:

The agricultural sector contributes an average of 0.7% of the GDP of Switzerland. The sector does not contribute much to the country’s economy, but the Swiss government is very protective of it.

There are many government subsidies for farmers as well as high tariffs to encourage domestic agricultural practices, so about 60% of the food consumed in Switzerland is locally grown and produced and meets about 65% of the country’s food demand.

A large portion of the country’s budget (about 5.5% of annual budget) is used for boosting production of food.

The economy of Switzerland is driven by the manufacturing industry which contributed 25.6% of its GDP in 2017. Switzerland is one of the world’s largest exporters.

The country contains one of the most competitive pharmaceutical industries in the world, is also involved in the manufacture of food products (like Nestle) and chemicals used in the construction sector and is also famous for the manufacturing of high-end clocks and watches.

Regarding tourism, Switzerland enjoys revenues of up to CHF 16.8 billion every year. Many tourists are drawn to Switzerland annually. Some of the top-rated places for tourist visits in the country are Matterhorn (one of the highest mountains in the Alps), the Jungfraujoch (or the “Top of Europe”) Rhine Falls, Lake Geneva, the Chillon Castle, Bern City, and the Swiss National Park.
The banking sector in Switzerland is known for its policies of protection of foreign accounts. It is a criminal offense to reveal client information just as it is in the case of doctors and priests.

The banks’ regulation authorities in Switzerland are the Swiss Financial Market Supervisory Authority and the Swiss National bank.

In 2018, the Swiss Bankers Association estimated that the value of the assets held by the Swiss Banks was about US$6.5 trillion.

The chemicals and pharmaceuticals industry is Switzerland’s leading exporter, generating roughly 50% of total annual exports and 5% of GDP. There are approximately 1,000 industry operators, including two major multinationals.

The chemicals and pharmaceuticals industry generated 6.3% of Switzerland’s GDP in 2020, coming in second behind machinery.

However, it is the top performer in terms of exports. Over CHF 116 billion in chemical and pharmaceutical products are sold abroad every year, accounting for almost 52% of total exports. In 2020, the sector employed around 74,000 people in Switzerland and over 338,000 internationally.

The machine, electrical engineering, and metals industry (or MEM, for short) has a total workforce of 320,000. 99% of the companies are SMEs with less than 250 employees.

The sector employs over 500,000 people internationally and is Switzerland’s second largest exporter, worth CHF 63 billion in 2015, 31% of total Swiss exports. Almost 60% of MEM industry exports go to the EU.

The Main Sectors of the Swiss Economy

The country focuses on the following key sectors, which all have a significant impact on the country’s economy:

Thun castle, Switzerland
The agricultural sector contributes an average of 0.7% of the GDP of Switzerland. The sector does not contribute much to the country’s economy, but the Swiss government is very protective of it.

There are many government subsidies for farmers as well as high tariffs to encourage domestic agricultural practices, so about 60% of the food consumed in Switzerland is locally grown and produced and meets about 65% of the country’s food demand.

A large portion of the country’s budget (about 5.5% of annual budget) is used for boosting production of food.

The economy of Switzerland is driven by the manufacturing industry which contributed 25.6% of its GDP in 2017. Switzerland is one of the world’s largest exporters.

The country contains one of the most competitive pharmaceutical industries in the world, is also involved in the manufacture of food products (like Nestle) and chemicals used in the construction sector and is also famous for the manufacturing of high-end clocks and watches.

Regarding tourism, Switzerland enjoys revenues of up to CHF 16.8 billion every year. Many tourists are drawn to Switzerland annually. Some of the top-rated places for tourist visits in the country are Matterhorn (one of the highest mountains in the Alps), the Jungfraujoch (or the “Top of Europe”) Rhine Falls, Lake Geneva, the Chillon Castle, Bern City, and the Swiss National Park.
The banking sector in Switzerland is known for its policies of protection of foreign accounts. It is a criminal offense to reveal client information just as it is in the case of doctors and priests.

The banks’ regulation authorities in Switzerland are the Swiss Financial Market Supervisory Authority and the Swiss National bank.

In 2018, the Swiss Bankers Association estimated that the value of the assets held by the Swiss Banks was about US$6.5 trillion.

The chemicals and pharmaceuticals industry is Switzerland’s leading exporter, generating roughly 50% of total annual exports and 5% of GDP. There are approximately 1,000 industry operators, including two major multinationals.

The chemicals and pharmaceuticals industry generated 6.3% of Switzerland’s GDP in 2020, coming in second behind machinery.

However, it is the top performer in terms of exports. Over CHF 116 billion in chemical and pharmaceutical products are sold abroad every year, accounting for almost 52% of total exports. In 2020, the sector employed around 74,000 people in Switzerland and over 338,000 internationally.

The machine, electrical engineering, and metals industry (or MEM, for short) has a total workforce of 320,000. 99% of the companies are SMEs with less than 250 employees.

The sector employs over 500,000 people internationally and is Switzerland’s second largest exporter, worth CHF 63 billion in 2015, 31% of total Swiss exports. Almost 60% of MEM industry exports go to the EU.

Commercial Laws in
Switzerland

  • The Federal Tax Administration (FTA) – is responsible for value added tax, direct federal tax, withholding tax and other federal levies. It implements double taxation agreements, provides international administrative assistance in tax matters, collects withholding taxes for other states in accordance with treaties and compiles tax statistics.
  • Ch.Ch – The online government portal for the Swiss Federal Government, which has a whole section on employment and workers’ rights.
Tax liability is based on residency and with different classes depending on marital and family status. Liability is at federal, cantonal, and municipal levels with the addition of church taxes where applicable. Residents are taxed on their worldwide income in a tax year running from January 1 until December 31, while non-residents are taxed on certain categories of their Switzerland-sourced income, or income derived from Swiss investments.

Income Tax:

Social Insurance Taxes: Employers and employees equally share 10.6% of salary towards old age, survivors, and disability insurance; 2.2% towards unemployment insurance capped at CHF 148,200 (€143,061, US$161,676); 1% towards supplementary unemployment insurance above CHF 148,200.

Additionally, employers contribute between 1% and 3% towards family compensation fund, uncapped; 0.17% and 13.5% to occupational insurance, capped at CHF 148,200. Employees contribute between 1% and 4% to non-occupational insurance.

For more information on tax contributions and benefits Download our Switzerland Country Guide…

Commercial Laws in
Switzerland

Image of Lucerne, Switzerland during twilight
  • The Federal Tax Administration (FTA) – is responsible for value added tax, direct federal tax, withholding tax and other federal levies. It implements double taxation agreements, provides international administrative assistance in tax matters, collects withholding taxes for other states in accordance with treaties and compiles tax statistics.
  • Ch.Ch – The online government portal for the Swiss Federal Government, which has a whole section on employment and workers’ rights.
Tax liability is based on residency and with different classes depending on marital and family status. Liability is at federal, cantonal, and municipal levels with the addition of church taxes where applicable. Residents are taxed on their worldwide income in a tax year running from January 1 until December 31, while non-residents are taxed on certain categories of their Switzerland-sourced income, or income derived from Swiss investments.

Income Tax:

Social Insurance Taxes: Employers and employees equally share 10.6% of salary towards old age, survivors, and disability insurance; 2.2% towards unemployment insurance capped at CHF 148,200 (€143,061, US$161,676); 1% towards supplementary unemployment insurance above CHF 148,200.

Additionally, employers contribute between 1% and 3% towards family compensation fund, uncapped; 0.17% and 13.5% to occupational insurance, capped at CHF 148,200. Employees contribute between 1% and 4% to non-occupational insurance.

For more information on tax contributions and benefits Download our Switzerland Country Guide…

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