The step up
GmbH formation
The CHF 20,000 limited-liability company, the natural next form once the liability or the scale outgrows a sole proprietorship.
GmbH formationSwiss sole proprietorship
(Einzelfirma)
The sole proprietorship is the fastest, cheapest way to trade in Switzerland: no minimum capital, register only at CHF 100,000 turnover. The price is unlimited personal liability, and one hard limit: it is generally open only to people who live in Switzerland. We confirm whether it fits, weigh it against a GmbH, and set it up, including the self-employment recognition that is the real hurdle.
At a glance
The simplest form, with the sharpest trade-off.
No capital, fast to start, but personal liability and residence required.
- Minimum capital
- None
- Register entry
- Mandatory at CHF 100,000 turnover
- Liability
- Unlimited, personal
- Owner residence
- Must live in Switzerland
- Taxation
- Owner’s personal income
The essentials
What a sole proprietorship is, and who it is for
A Swiss sole proprietorship (Einzelfirma) is a business carried on by one individual in their own name, governed for registration purposes by the Code of Obligations. There is no separate legal entity and no minimum capital, which makes it the fastest, cheapest way to start, and the reason the owner carries unlimited personal liability. It is the right form for a low-risk, owner-run activity, and the wrong one the moment real liability or outside capital appears.
Who it suits
- freelancers, consultants and independent professionals based in Switzerland;
- small local trades and services with limited liability exposure;
- founders testing an activity before committing capital to a company.
Who it does not suit
If you live abroad, the sole proprietorship is generally not open to you. A Swiss GmbH or AG is the route. And if the activity carries real risk, the personal liability makes a company the safer form regardless of where you live.
The decision
Sole proprietorship or GmbH
The choice is not really about cost: it is about who carries the risk and whether you can even use the form. This is where the two diverge.
| Sole proprietorship | GmbH | |
|---|---|---|
| Minimum capital | None | CHF 20,000 (fully paid) |
| Liability | Unlimited, personal | Limited to the capital |
| Separate legal entity | No | Yes |
| Open to a non-resident | No, owner must live in CH | Yes, with a resident director |
| Taxation | Owner’s personal income | Corporate, then on distribution |
| Name | Must contain owner’s surname | Free company name |
For a resident freelancer with low risk, the sole proprietorship is often exactly right. For anyone abroad, anyone carrying real liability, or anyone who wants to trade under a brand rather than their own name, the GmbH earns its capital. We make that call against your situation, not a default.
How it runs
How you set one up
Simpler than a company, but with one step that genuinely decides whether it works: the self-employment recognition. Timings are short where residence and the right to work are in place.
- Step 1
Eligibility check
Confirming residence and, for non-EU/EFTA nationals, the permit that allows self-employment: the gate that decides whether the form is even available.
- Step 2
Self-employment recognition
Registering with the AHV/AVS compensation office and evidencing genuine self-employment: several clients, own risk, own resources.
- Step 3
Name & bank
Setting the business name with the owner’s surname, and a business bank account separating private and business money.
- Step 4
Register entry where required
Commercial-register entry, mandatory at CHF 100,000 turnover and optional below, plus VAT registration where turnover requires it.
- Ongoing
Books & review
Proportionate bookkeeping for the size, and a periodic check of whether the activity has grown past the point where a GmbH is the safer home.
Budget
What it costs
A sole proprietorship has no minimum capital, so there is no equity to lock up. The cost is purely the work: the eligibility and self-employment recognition, the name and bank setup, and the register entry where turnover requires it.
We quote a fixed fee for the setup and the recognition. The value is a sole proprietorship that the authorities accept as genuinely self-employed, the step that most often goes wrong when it is done alone.
Ask for a fixed fee
What you need
What it requires
The sole proprietorship has few formalities, but the ones it has are decisive:
- residence in Switzerland and the right to work self-employed;
- recognition as self-employed by the AHV/AVS compensation office;
- a business name containing the owner’s family name;
- a commercial-register entry once turnover reaches CHF 100,000;
- proportionate accounting and the owner’s personal tax return.
The liability is not a formality: it is the whole point
Because there is no separate legal entity, a business debt is your debt, reachable against your home and savings. Founders attracted by “no capital, fast to start” sometimes skip past this, then take on a contract or a client claim that a company would have contained. If the activity can generate real liability, the right answer is not a sole proprietorship with insurance bolted on. It is a GmbH, where the company, not you, stands behind the obligation. We say so plainly before you start, not after a claim.
Why Goldblum
Set up the right way
The paperwork is light; the judgement is not. Whether the form fits, whether the self-employment will be recognised, and when to move up to a company: that is where we earn our place.
Honest
The right form, even if it is not us
If a sole proprietorship genuinely fits, we set it up and say so, and if the liability or your residence rules it out, we tell you before you spend, not after.
Recognition
Self-employment that holds
The AHV/AVS recognition handled with the right evidence, so you are accepted as self-employed rather than reclassified as an employee later.
Path up
Ready to become a GmbH
The setup arranged so a later, tax-neutral conversion to a GmbH is a planned step once the risk or the profit justifies it.
Related
When you outgrow it
Non-residents
Swiss company formation
The route for a founder based abroad, for whom a sole proprietorship is closed: what Swiss law actually requires to own a company here.
Company formationInstitutional
AG formation
The CHF 100,000 stock corporation, for when the activity needs real substance, outside investment or a non-public ownership register.
AG formation
FAQ
Swiss sole proprietorship: FAQ
01What is a Swiss sole proprietorship?
A sole proprietorship (Einzelfirma, raison individuelle) is a business run by one individual in their own name. There is no separate legal entity and no minimum capital: the owner and the business are the same in law, which is why it is the fastest and cheapest way to trade, and why the owner is personally liable for everything the business owes. It suits freelancers, consultants and small local trades; it is the wrong form once real liability or outside capital enters the picture.
02Do I need to register a sole proprietorship?
Only above a threshold. Entry in the commercial register is mandatory once annual turnover reaches CHF 100,000; below that it is optional, though registering brings credibility and a protected business name. Either way, the more important step is registering as self-employed with the social-security authorities (AHV/AVS) and having that self-employed status recognised, which is not automatic and is where many setups stall. We handle the recognition, not just the register entry.
03Can a non-resident open a Swiss sole proprietorship?
Generally no, and this is the difference that surprises foreign founders. A sole proprietorship requires the owner to live in Switzerland and, for non-EU/EFTA nationals, to hold a residence and work permit that allows self-employment. You cannot run a Swiss sole proprietorship from abroad. By contrast, a non-resident can own a Swiss AG or GmbH without living here, provided the company has a resident director. If you are based outside Switzerland, the company forms (not the sole proprietorship) are the realistic route.
04What is the liability of a sole proprietorship?
Unlimited and personal. The owner is liable for all business debts with their entire private wealth (home, savings, everything) because there is no separate legal entity to absorb the risk. This is the single most important fact about the form. For a low-risk activity it is an acceptable trade for the simplicity; for anything that can generate real claims, contracts or debt, the limited liability of a GmbH or AG is worth the extra cost and capital.
05Sole proprietorship or GmbH — which should I choose?
Liability is the dividing line. Choose the sole proprietorship for a low-risk, owner-run activity where simplicity and no minimum capital matter, and the personal liability is tolerable. Choose the GmbH (CHF 20,000 capital, separate legal entity) the moment real liability, contracts, employees or outside money are involved, because it stops business claims at the company. Many founders start as a sole proprietorship and convert to a GmbH as the risk grows; we advise on when that line is crossed.
06How is a Swiss sole proprietorship taxed?
There is no separate corporate tax. The profit is taxed as the owner's personal income, together with their other income, at federal, cantonal and communal rates, and the owner pays social-security contributions as a self-employed person. This is simpler than a company's two-layer taxation, and at low profit levels often cheaper. But as profit rises, the company forms with their separate, often lower, corporate rates can become more efficient. We compare the two against your expected profit.
07Does the business name have to follow a rule?
Yes. A sole proprietorship's name must contain the owner's family name; you can add a descriptive or fantasy element, but the surname is mandatory and cannot be dropped. This is a direct consequence of the form: the business is the person. If you want to trade purely under a brand name without your own surname attached, that points towards a GmbH or AG, where the company name is free of that requirement.
08Do I need to be recognised as self-employed?
Yes, and it is a real hurdle. The social-security authorities (the AHV/AVS compensation office) decide whether you genuinely qualify as self-employed, looking at whether you work for several clients, bear your own business risk and use your own resources. Someone working for a single client can be refused and treated as an employee. Getting the recognition right, with the supporting evidence, is part of setting the sole proprietorship up properly, and is where we add value.
09Can I convert a sole proprietorship into a GmbH or AG later?
Yes. A sole proprietorship can be converted into a GmbH or AG, transferring the business, its assets and its goodwill into the new company, commonly done once the activity grows, the liability matters, or outside investment is needed. With the right structuring the transfer can be tax-neutral. Planning the conversion before the business has grown valuable is easier than retrofitting it; we set the path so the move up is a planned step, not a scramble.
10How fast can I start trading as a sole proprietorship?
If you already live in Switzerland with the right to work self-employed, almost immediately: you can begin trading and register with the social-security authorities, with the commercial-register entry following where turnover requires it. The speed is the form's main appeal. The constraint is residence: without the right to live and work here as self-employed, the sole proprietorship is not available, and a company is the way in.
11Does a sole proprietorship need accounting?
Yes, but lighter. A sole proprietorship below CHF 500,000 turnover can keep simplified accounts (income, expenditure and asset position) rather than full double-entry bookkeeping, which keeps the administrative burden low. Above that threshold, or once registered, fuller accounting applies. Either way the records must support the owner's tax return and the self-employment position. We set up the bookkeeping to match the size, so it is proportionate from the start.
Sole proprietorship or company?
Tell us where you live and what you will do. A partner confirms whether a sole proprietorship is even open to you, weighs it against a GmbH on liability and tax, and sets it up the right way.