Setting Up an LLC (Sarl) in Switzerland: Complete Guide 2026

What Is an LLC (Sarl) Under Swiss Law?

The limited liability company (Sarl/GmbH) is governed by articles 772 to 827 of the Code of Obligations (CO). It is one of the most popular legal forms in Switzerland, particularly for SMEs. The Sarl combines the flexibility of a partnership with the protection offered by limiting liability to the share capital.

Formation Requirements (Art. 772-779 CO)

To set up a Sarl in Switzerland, several conditions must be met:

1. Minimum capital: CHF 20,000, fully paid up at incorporation (art. 773 CO). Each share must have a nominal value of at least CHF 100.
2. Members: at least one member, natural or legal person. Unlike the SA, members are registered in the commercial register (art. 790 CO).
3. Registered office: the company must have its registered office in Switzerland.
4. Notarial deed: incorporation requires an authenticated deed before a notary public (art. 777 CO).
5. Auditor: mandatory if two of the following thresholds are exceeded during two consecutive financial years: balance sheet of CHF 20 million, turnover of CHF 40 million, 250 full-time positions. Small Sarls may waive the limited audit (opting-out) with the agreement of all members, provided the company employs fewer than 10 full-time positions.

Steps of Incorporation

1. Name verification: check the availability of the company name on Zefix (central index of company names).
2. Drafting the articles of association: the articles must contain the company name, registered office, purpose, amount of share capital and nominal value of shares (art. 776 CO).
3. Opening a deposit account: deposit of the share capital with a Swiss bank.
4. Constitutive deed before a notary: declaration of constitution, approval of articles, appointment of management.
5. Registration in the commercial register: the Sarl acquires legal personality upon registration (art. 779 CO).
6. OASI/DI affiliation and registration with social insurance institutions.
7. VAT registration: mandatory once annual turnover exceeds CHF 100,000.

Governance and Management

The management of the Sarl may be entrusted to one or more managers, who must be members unless the articles of association provide otherwise (art. 809 CO). At least one manager must be domiciled in Switzerland. The members' meeting is the supreme body: it approves the accounts, appoints the managers and decides on amendments to the articles (art. 804 CO).

Member Liability

Under art. 794 CO, members are not personally liable for the company's debts. Their risk is limited to their contributions. However, the articles may provide for supplementary contributions (art. 795 CO) and ancillary obligations (art. 796 CO).

Taxation of the Sarl

The Sarl is subject to corporate income tax and capital tax at the federal, cantonal and municipal levels. Profit distributions to members are taxed as income. Economic double taxation is partially mitigated by partial taxation of dividends (art. 20 para. 1bis DITA).

Advantages and Disadvantages

The Sarl offers an accessible minimum capital (CHF 20,000 vs CHF 100,000 for the SA), limited liability and a lightweight structure. On the other hand, the publicity of members in the commercial register and lesser flexibility in transferring shares may be disadvantages for some entrepreneurs.