Zugimpex shows that it is still attractive to own a Swiss company, if you can use the image, have contact to local customers or benefit from legal advantages.

1. Mag. Johannes Schwarz, MBA
Zugimpex Group
Swiss companies: how to reduce
costs and increase flexibility
www.zugimpex.com

2. Zugimpex Group
2
Mag. Johannes Schwarz, MBA
Zugimpex Group
San Gwann
Malta
Bratislava
Slovakia
Riga
Latvia
(branch)
Cham/Zug
Switzerland
Corporate
Services
Consulting
Services
Investment
Services

3. Switzerland 2018
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 Neutral, stable, hard currency
 Direct democracy, („Referendum“)
 Tax reform – 12% planned in Zug
 new legal loopholes, some data security
 High price and salary level
 Regulation (compliance) of banks and fiduciaries
 Difficulties with bank accounts
 Open exchange of information
 political shift after elections 2015:
 Change of attitude (towards customers)
 tax reform
 Reform AMS Law (proposal 01.06.2018)
 ICO guidelines
 financial services laws (FIDLEG, FINIG)
 Changes, challenges, opportunities!
Mag. Johannes Schwarz, MBA
Zugimpex Group

4. Switzerland- focus on target groups:
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 Multinational corporations with high qualified employees
 Private entities that pay a premium for:
 Swiss image
 Holding as image factor
 Product/ Service image
 Security and protection
 Legal benefits and legal loopholes
 No public register for beneficial ownership (EU)
 e.g. > 300.000 CHF/year: money laundering after fiscal evasion
 ICO regulations (Blockchain, Crypto Valle Zug)
 Access to Swiss customers/ Swiss market
 The hidden message:
 take it (and pay) ---- or leave it
 (example: 3000 CHF fee of one bank to open account 2017, 2018 only
for branch office of a foreign company)
Mag. Johannes Schwarz, MBA
Zugimpex Group

5. Some ideas and solutions:
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1. Company law
2. Corporate tax and social
charges
3. Banks
4. ICO regulations, crypto valley
Mag. Johannes Schwarz, MBA
Zugimpex Group

6. 1a. Company Law - Structures
6
Legal structures
GmbH (LLC)
AG (shares)
KG (GP/LP)
Branch
Mag. Johannes Schwarz, MBA
Zugimpex Group
Company Formation - Challenge:
• Blocked account at a Swiss bank is required, but no obligation for banks to
open it
Solutions:
• Knock on doors, find a bank who opens a blocked account and pay exactly as
stated
• Capital contribution in kind (+ auditor)
• Buy an existing company
Company Law - Challenge:
• “A Swiss company must be represented by a person resident in Switzerland.
who is board member or director.“ (Art 718 OR, Art 814 OR)
• Authorities put obligations upon Swiss residents who are board members (e.g.
tax liabilities)
Solutions:
• no Swiss resident as (nominee) board member
• just title „director“ and signature rights for Swiss resident person
• option: two Swiss residents with joint signature
International Tax Law - Challenge:
• Acceptance of invoices, reverse burden of proof
Solutions:
• active company with real place of business in Switzerland
(employees or regular trips to the company)
• Tax residency certificates
• Holding in country with lower wages, M&C at domicile of holding
• Employ a bookkeeper part time, but give him additional tasks (DTT)
• Make sure services are proper documented and amounts fit to the industry

7. 1b. Company Law - Shares
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 Bearer Shares or Registered shares:
• Challenge:
• shareholders not published, but share register required at company
domicile
• managing director must register the identity of shareholders.
• 25% threshold if shares are held on behalf of third parties
• Solutions:
• Conditions: change of ownership may be impossible to register if
conditions are needed (e.g. a certain approval)
• Separate rights – e.g. for dividends, to vote, to sell the shares
• know the consequences: board is liable for loss or for wrong or
incomplete entries (to shareholders)
• Know the consequences: shareholder who is not registered has no
rights for dividends
• Derivatives: options, futures, silent partnership, participating loan
• Foundations, associations as shareholders
Mag. Johannes Schwarz, MBA
Zugimpex Group

8. 2a. Tax - Authorities
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 Cantonal tax offices: helpful
 26 cantons compete; federal/ local profit tax:
 Cantonal tax rate for companies and individuals
 Tax basis and exemptions, rulings
 Friendly cantons: e.g. Zug, Schwyz, Nidwalden, Obwalden
 Federal VAT administration Bern
Challenges:
 Federal Tax office Bern:
 35% withholding tax on interests and dividends;
 Inspections for federal tax at cantonal tax offices
 Social security administrators
Mag. Johannes Schwarz, MBA
Zugimpex Group

9. 2b. Tax and Social Charges- Solutions
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Reduce federal and cantonal tax:
 Domicile in a Canton with reasonable tax administration
 Negotiate cost positions with good arguments
 management and control outside Switzerland (e.g. Cyprus)
 Tax free capital gains (but anti abuse clauses: transposition and
indirect partial liquidation)
Avoid 35% withholding tax on dividends:
 Swiss branch of a foreign entity (can act as holding)
 No private ownership of shares
 Holding in a country with 0 rate (but: form 823b)
 (DTT or Art 15 Interest Rate conventions // Denkavit Praxis)
Avoid unlimited social security contributions:
 Legal entity
 Switzerland adopted Regulation EC 883/2004 – coordination of
social secrity systems  Posting ?
Mag. Johannes Schwarz, MBA
Zugimpex Group

10. 2c. Tax - Posting
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Use „Posting“ or home office - employment:
 An employee can be posted to another country and keep the social
security of his home country (using form A1)
 It is possible for a Swiss company to employ a person who works from
his/ her home office
 Select a canton that charge zero or little employment withholding tax up
to 60.000 Euro annual income
 Personell can be employed in companies, who like to show substance
and cooperate.
  check the Double tax treaty (articles of the OECD model convention)
 Article 23: exemption method or credit method
 Article 15: income from employment
 Article 16: director´s fees
  check Social Charges:
 EU: Make sure that the upper limit for social security is reached in the country
from where the posting happens
 Outside EU: check if there is no agreement on social charges
Mag. Johannes Schwarz, MBA
Zugimpex Group

11. 2d. Corporate Tax - Example
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Swiss Company- M&C in Cyprus:
 Swiss company with Cyprus intermediary holding and mother
holding outside Cyprus:
 Manager of the Swiss company: resident without domicile in
Cyprus.
  from zero withholding tax Switzerland - Cyprus
  tax advantage for salary
  no social charges
  reduced bureaucracy (e.g. AML)
 Part time employment in Switzerland, up to 8 days per year without
registration
  basis for a model for Cyprus professionals
Mag. Johannes Schwarz, MBA
Zugimpex Group

12. 2e. „Tax bill 17“
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Tax Bill 17 „Steuervorlage 17“:
 Last bill (USR III) was rejected by referendum
 Tax Bill 17 will be possibly subject of a referendum, too
 Planned to be valid from 1.1.2021, parts before
 Termination of the status of domicile companies with preferred foreign
income
 Same cantonal tax for all companies (will be 12% in Canton Zug)
 Tax on dividends for residents min. 70% of regular tax rate
 Patent box plus benefits for research and development
 Step up for companies that are migrating to Switzerland (activate hidden
reserves)
 No deemed interest expenses on equity
 Stronger rules for Transposition (private person sells to a company
where it is SH)
Mag. Johannes Schwarz, MBA
Zugimpex Group

13. 3a. Banks
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Mag. Johannes Schwarz, MBA
Zugimpex Group
Blocked bank account for capital payment
 Easy for Swiss residents, difficult for foreigners
 Payment must come from a private account of the shareholder, not
from a company where the person is shareholder
 If not: banks send the capital back and charge fees
Regular company account
 Can be everywhere
 Swiss law differenciates active and passive companies
 Reporting from a Swiss bank may go to the country of residence
 But reporting from a foreign bank goes to Switzerland

14. 3b. AML- Legislation and Banks
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 Criminal law: Professionals are subject to Art.305 criminal law:
„neglect of professional due diligence“.
 Regulation since 2016:
 Financial intermediaries shall register the beneficial owner of active companies
 Financial intermediary shall execute orders in suspect cases, no blocking, no info
 Challenge: Self - regulatory system (SRO):
 Financial intermediaries have to document all relevant transactions and
keep special records, if the company qualifies as offshore and if a board
member is professional intermediary
 Solution: no files required if:
 Active company (not offshore)
 Active business in operation
 or former active business in liquidation
 Holding: holder of > 50% in one or more active companies
 Not very active company with non- professional board members
 < 20.000 CHF revenue from the activity / year
 < 20 contracting parties / year
 < 5M CHF under administration and < 2M transactions
Mag. Johannes Schwarz, MBA
Zugimpex Group

15. 3c. Proposed changes in AML
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 Proposal published by the EFD on 01.06.2018
 Due diligence requirements for certain services related
to companies and trusts, mainly in the area of
incorporation, management and administration. Activities
for operating companies in Switzerland will be excluded
due to their low risk. There will be no supervision
 Stronger obligations for financial intermediaries: to verify
the beneficial owners and to regularly update the
information based on risk (info: it was published that a
person that had died already 10 years ago was nominee
director in 4900 offshore companies).
 Obligation for associations and clubs to register in the
commercial register.
 Higher duties for purchasing gold etc. second hand
Mag. Johannes Schwarz, MBA
Zugimpex Group

16. 4a. ICO and Blockchain Regulation
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Guideline FINMA 4/ 2017 refers that the following laws may be relevant:
 AML
 Securities Law
 Banking Law
 Law for collective investment schemes
ICO guidelines FINMA (16.02.2018)
 Payment Token  AML regulation
 Utility Token  no regulation
 Security Token  Security Broker license
 But: Right for an utility token can be a security
Regulation compared to the regulation elswhere:
 Financial market Test –Switzerland yes
 Technology audit – Switzerland no
 Audit of organization – Switzerland no
 Fit and Proper Test of Key Person–Switzerland sometimes
Mag. Johannes Schwarz, MBA
Zugimpex Group

17. 4b. Crypto and Taxation – important
questions
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1. Private person: tax free capital gain or
professional dealer ?
2. Evaluation in the balance sheet:
1. Currency: value at the exchange
2. Goods: purchase and procurement price
3. VAT for tokens: similar to vouchers
1. Specific voucher – subject to VAT when voucher is
sold
2. General voucher – when product is paid with
voucher
Mag. Johannes Schwarz, MBA
Zugimpex Group

18. 4c. Crypto Valley Zug
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1. Well organized
2. Accumulation of know how
3. Success stories
4. Dynamic development
Mag. Johannes Schwarz, MBA
Zugimpex Group

19. Mag. Johannes Schwarz, MBA
Zugimpex Group
https://www.zugimpex.com
info@zugimpex.com
Switzerland – there are again opportunities
Zugimpex is glad to assist you
contact us and visit our stand today !
www.zugimpex.com