AG vs GmbH in Switzerland: Which Legal Form Is Right for You?

Capital requirements: CHF 20'000 versus CHF 100'000

The GmbH requires a minimum share capital of CHF 20'000 (Art. 773 OR, SR 220), paid in full at incorporation. The AG requires a minimum of CHF 100'000 (Art. 621 OR), of which at least CHF 50'000 must be paid in at the time of founding; the remainder may be called up later. Both figures were confirmed unchanged by the 2023 Aktienrechtsrevision (in force 1 January 2023).

Since 1 January 2023, both the AG and GmbH may denominate their capital in EUR, USD, GBP or JPY. The CHF equivalent must still meet the respective CHF threshold at the time of notarisation (Art. 621 Abs. 2-3 OR for the AG; Art. 773 Abs. 2 OR for the GmbH).

The 2023 revision abolished the previous minimum par value of CHF 0.01 per AG share: a share may now carry any value greater than zero (Art. 622 Abs. 4 OR, as revised). The revision also introduced the capital band (Kapitalband) for the AG: the board may be authorised for up to five years to increase or reduce share capital within a band of plus or minus 50% of the registered figure, with a floor of CHF 100'000 (Art. 653s-653v OR). The GmbH has no equivalent. The Kapitalband is useful for companies managing acquisition structures, option programmes or debt covenants, because it allows equity adjustments without a full general meeting each time.

Commercial register fees: the federal base charge for registering either a new AG or GmbH is CHF 420 (GebV-HReg, SR 221.411.1), plus CHF 20 per registered signatory or officer; in practice the total federal charge typically reaches CHF 500-800 with additional positions. Cantons add their own fees on top. Total founding costs, including professional fees, notary and bank account, run to approximately CHF 2'000-4'000 for a GmbH and CHF 4'000-8'000 for an AG (secondary estimates from service providers).

Shareholder transparency: what the public register shows

GmbH shareholders (Gesellschafter) are listed in the public commercial register with their names, domicile and nominal value of their quotas (Stammanteile), searchable via Zefix.ch (Art. 791 OR; HRegV). There is no mechanism within the GmbH form to keep a shareholder's name off that public registry.

AG shareholders (Aktionäre) do not appear in the public register at all. Only the board of directors (Verwaltungsrat) and authorised signatories are publicly visible via Zefix. Shareholders are recorded solely in the company's private share register (Aktienbuch, Art. 686 OR).

The privacy differential is real, but not absolute. Bearer shares (Inhaberaktien) in unlisted AG were abolished as of 1 November 2019, and any remaining unlisted bearer shares were converted by law into registered shares (Namenaktien) on 1 May 2021. Anti-money-laundering law requires any shareholder of an unlisted AG holding 25% or more of the capital or voting rights to report the beneficial owner to the company, which keeps those details in a separate register of beneficial owners (Art. 697j and 697l OR, GAFI reform). That register is private but accessible to Swiss authorities on request. A minority AG shareholder below the 25% threshold does not appear in any public registry and is not subject to the Art. 697j reporting duty.

The AG provides structural privacy from public view. For any purpose requiring confidentiality from Swiss institutions, neither form provides it.

Transferring your stake: shares versus quotas

AG registered shares (Namenaktien) can be transferred by endorsement and delivery, or by a written assignment agreement. No shareholder meeting approval is required unless the statutes contain transfer restrictions (Vinkulierung, Art. 685 OR). Transfer takes effect through entry in the Aktienbuch (Art. 686 OR). This ease of transfer is the defining practical advantage of the AG for any company that anticipates bringing in investors, running employee equity programmes or enabling founder exits.

GmbH quotas (Stammanteile) carry a substantially more complex transfer process. Transfer requires written form (Art. 785 Abs. 1 OR) and, in most cases, approval by a shareholder resolution passed with at least two-thirds of the votes represented and an absolute majority of the total voting capital (Art. 786, 808b Abs. 1 Ziff. 4 OR). The transfer becomes legally effective only after that approval (Art. 787 OR) and must be notified to the commercial register. Where the transfer requires a statutory amendment, public notarisation is also needed, at an estimated cost of CHF 1'000-3'000 per transaction (practitioner estimate; not an official fee schedule).

The approval requirement cannot be waived by private agreement. A GmbH quota transfer that bypasses the required shareholder resolution has no legal effect. For a startup structuring a seed round or an SME setting up an employee share plan, this is a material structural constraint compared with the AG.

Governance: who manages the company by default

The GmbH and AG start from opposite governance defaults. GmbH shareholders (Gesellschafter) have both ownership and management rights by default under the principle of Selbstorganschaft (Art. 809 Abs. 1 OR): every shareholder participates in management unless the statutes or a shareholder resolution delegates management to specific managing directors (Geschäftsführer). Non-competes and veto rights can be embedded directly in the GmbH statutes, providing founder-shareholders with structural protection within the constitutional document itself (Art. 803 Abs. 2 and Art. 807 OR).

AG shareholders (Aktionäre) have no management rights by default. They exercise influence through the general meeting (Generalversammlung), which elects the board, approves accounts and decides on fundamental matters (Art. 698 OR). Day-to-day management rests with the board of directors (Verwaltungsrat) or with executives to whom the board has delegated authority under Art. 716b OR. A sole founder may simultaneously be the sole shareholder, sole board member and sole managing director.

Both forms require that at least one person authorised to represent the company has a domicile in Switzerland (Art. 718 Abs. 4 OR for the AG; Art. 814 Abs. 4 OR for the GmbH). This is a representation requirement, not a requirement that all shareholders or board members be Swiss-resident. A foreign-resident founder may be the sole shareholder of either form, but the company must have at least one Swiss-domiciled authorised representative. A one-person board of directors has been permitted for the AG since the 2008 corporate law reform.

For founders who need to protect their position with veto rights or pre-emption rights, the GmbH statutes offer a more direct route. Equivalent protections in an AG require a separate shareholders' agreement (Aktionärsbindungsvertrag) outside the constitutional document.

AG and GmbH compared at a glance

The AG and GmbH share some features and diverge sharply on others; the table below maps the key dimensions as at August 2026.

Audit and reporting requirements

The AG and GmbH are subject to identical audit thresholds under Swiss law. An ordinary audit (ordentliche Revision, Art. 727 OR) is mandatory when a company exceeds at least two of three criteria in two consecutive financial years: balance sheet total of CHF 20 million, annual revenue of CHF 40 million, or an annual average of 250 full-time employees. Ordinary audits must be conducted by a RAB-licensed audit firm.

A limited audit (eingeschränkte Revision, Art. 727a OR) applies when a company employs more than ten full-time employees on annual average but does not reach the ordinary audit thresholds. Companies subject only to the limited audit may waive all audit requirements if all shareholders unanimously consent in writing (Art. 727a Abs. 2 OR). This opting-out arrangement is the standard approach for most small, newly incorporated companies of either form.

The 2023 revision (in force 1 January 2023) introduced enhanced liquidity monitoring duties for both forms: management must act as quickly as possible when insolvency is threatened (Art. 725 OR for the AG; Art. 820 OR for the GmbH). Gender diversity targets (Art. 734f OR) apply only to listed AG and have no relevance to GmbH or unlisted AG.

Four scenarios: when to choose which form

The AG or GmbH decision is best made against a specific use case. The four scenarios below cover the most common situations.

Holding company. The AG is the standard choice for a Swiss holding company. Freely transferable shares simplify movements of stakes between entities, the private Aktienbuch keeps the shareholding structure off the public register, and the Kapitalband (since 2023) allows flexible equity management without a shareholder vote at each step. Both AG and GmbH qualify equally for the participation deduction (Beteiligungsabzug, Art. 69-70 DBG) on subsidiary dividends and capital gains, so the case for the AG holding is structural rather than fiscal.

Owner-operated SME or professional practice. The GmbH is the practical choice. The lower capital requirement (CHF 20'000 versus CHF 100'000), built-in Selbstorganschaft, and the ability to embed veto rights and non-competes directly in the statutes give founder-shareholders structural control without a separate shareholders' agreement. Our GmbH formation service covers this structure from notarisation to register entry.

Fundraising startup or technology company. The AG is strongly preferred by investors. Shares are freely transferable; a funding round or secondary sale does not require a shareholder meeting. The Kapitalband (AG-only, since 2023) lets the board issue new shares for an option programme or a new tranche without a full general meeting each time. GmbH quota transfers require supermajority shareholder approval at each step, creating friction that slows term sheets and complicates cap table management. Our AG formation service is the starting point for founder teams.

Family business or multi-generational succession. Where keeping the family's shareholding structure off the public register matters, the AG is preferred. Where founding-generation control is the priority and the family is comfortable with public registration, the GmbH's statute-embedded veto and pre-emption rights are effective tools. Conversion from GmbH to AG is always available later under the Fusionsgesetz, so the choice is not irreversible.

When this form is not the right choice

The AG is not the right choice when available capital is below CHF 100'000, when co-founders want management rights by default without a formal board delegation mechanism, or when the company will remain a small owner-managed operation with no investor plans. The governance formality of the AG is rational for investor-backed companies and holdings; for a small service business with stable ownership, it is overhead without a corresponding benefit.

The GmbH is not the right choice when external investors expect freely transferable stakes. The statutory approval requirement for quota transfers (Art. 786 OR) cannot be fully removed by private agreement: each transfer must go through the commercial register and the statutory resolution process. Investors experienced in Swiss transactions will prefer the AG. The GmbH is also not appropriate where shareholder privacy matters: every shareholder appears on Zefix.ch from the date of incorporation, with no mechanism to shield that information from public search.

One decision the form does not resolve is tax. Both AG and GmbH are taxed at the same federal rate (effective approximately 7.83% on pre-tax profit) and subject to identical cantonal levies. The variable for tax planning is the canton of registered office, not the legal form: the difference between Zug (approximately 11.7% combined effective rate, 2026) and Zürich city (approximately 19.6%, 2025) depends entirely on location. For the canton-by-canton comparison, see the guide to corporate tax in Switzerland. Choosing an AG or GmbH to lower a tax bill has no basis in Swiss law.

Converting a GmbH to an AG: path and cost

A GmbH can be converted to an AG without liquidation under the Fusionsgesetz (FusG, SR 221.301, Art. 53 ff.). The company retains its legal identity, all existing contracts, its VAT registration and its commercial history; GmbH Stammanteile become AG shares (Aktien) proportionally.

Two prerequisites must be met before conversion can be filed. First, the GmbH's equity must reach at least CHF 100'000 (the AG minimum capital), typically requiring a capital increase if the GmbH was incorporated at CHF 20'000 (Art. 57 FusG, which applies the founding requirements of the target form). Second, an interim balance sheet is required if the last annual balance sheet is more than six months old, or if material changes in the financial position have occurred. Where the company has not opted out of audit requirements, the process may also require auditor review.

The procedure involves a shareholder resolution with qualified majority, public notarisation and commercial register filing. Professional fees start from approximately CHF 2'000 (provider quotes; fees vary by canton). The typical timeline from instruction to register entry is three to five weeks.

The conversion is tax-neutral when the statutory FusG requirements are met: no corporate income tax is triggered on the restructuring. The share issuance stamp duty (Emissionsabgabe) does not apply to conversions under FusG, as confirmed by ESTV guidance. For a GmbH that has outgrown its form and needs the AG's freely transferable shares, Kapitalband or private Aktienbuch, the FusG route is the correct path and can be planned as a clean step ahead of a capital round.

Tax: the level playing field

The AG and GmbH are taxed identically. Both are subject to federal corporate income tax at 8.5% on profit after tax (effective approximately 7.83% on pre-tax profit; DBG, SR 642.11), plus cantonal and municipal levies. The combined effective rate is approximately 11.7% in Zug city (2026) and approximately 19.6% in Zürich city (2025). Those differences arise from the canton, not the legal form.

Both forms qualify equally for the same planning instruments. The participation deduction (Beteiligungsabzug, Art. 69-70 DBG) reduces tax on dividend income from stakes of 10% or more (or worth at least CHF 1 million) and on capital gains from stakes of 10% or more held for at least one year. The patent box and R&D super-deduction under the Swiss tax reform (STAF) are available in cantons that have implemented them, for both AG and GmbH on equal terms.

Withholding tax (Verrechnungssteuer) of 35% applies to dividends paid by both AG and GmbH (VStG, SR 642.21). Swiss tax residents reclaim it by declaring the income; foreign recipients may reduce it under an applicable double tax treaty. The share issuance stamp duty (Emissionsabgabe) applies at 1% on equity contributions above the CHF 1 million per-company exemption, equally for both forms (StG, SR 641.10). Groups within scope of the OECD Pillar Two minimum tax (consolidated revenue of at least EUR 750 million; QDMTT in force 1 January 2024, IIR 1 January 2025) face top-up obligations regardless of whether the Swiss entity is an AG or GmbH.

The form decision is a governance, transfer and privacy decision. The canton decision is the tax decision. Both are made at incorporation; the canton can be changed later by a registered-office relocation, but the legal form conversion carries more steps. Matching the form to the realistic ownership and governance trajectory of the business from the outset avoids a more involved restructuring later.