Holding and auxiliary companies in Switzerland

Holding and auxiliary companies

Holding companies are corporations that do not carry out any commercial activity in Switzerland and whose main occupation is the management of participations. These companies can have a holding status. The latter allows them to reduce their income tax at the cantonal and municipal levels, including capital gains. However, in order to benefit from this privilege, these entities must meet certain conditions. Indeed, their participations must represent at least 2/3 of their assets or, if not, 2/3 of their income is composed by the income of the participations.

The annual tax on equity capital is paid at a global rate of 0.3%.

Finally, preferential regimes may be granted on dividends and capital gains on participation.

Auxiliary companies in Switzerland

Many so-called auxiliary companies exist in Switzerland. These are corporations, cooperative societies and foundations that only carry out a supplementary business activity in Switzerland. Their main sources of trade are, indeed, foreign-oriented.

Unlike some companies, auxiliary companies have a special tax status. As far as their tax regime is concerned, they enjoy a reduction of the net income tax of the foreign source. As for contributions on income from Swiss sources, they are the same as for other companies and the rate remains normal.

It should be noted that this tax status only applies to cantonal and municipal taxes. As a result, companies must claim their taxes from the cantonal tax authorities. Moreover, it becomes null and void after 5 years, provided it is renewed. However, this renewal requires several requirements.

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