Trading company in Switzerland: structure and tax

Switzerland has historically been one of the world’s hubs for commodity trading and international commerce: a central location, a strong currency, a solid banking system, a competitive tax framework and a unique concentration of logistics and financial expertise. But “trading company” covers very different models — from physical trade in goods to brokerage and financial trading — and each has its own structural and regulatory implications. Before choosing the form, the activity must be defined precisely.

What we mean by trading

Drawing distinctions is the first task:

• Commercial (physical) trading: buying and reselling goods — commodities, industrial products, consumer goods — with or without physical transit through Switzerland. This is ordinary commercial activity.
• Intermediation / brokerage: bringing buyer and seller together in exchange for a commission, without ever owning the goods.
• Proprietary financial trading: buying and selling financial instruments with the company’s own capital. When carried out on behalf of third parties or as asset management, it enters a regulated perimeter that requires authorisations.

This article focuses on commercial trading and intermediation, the most widespread forms. Financial trading for third parties is an entirely different matter, with specific licensing obligations.

The corporate form: the AG is the standard

For a trading company, the almost inevitable form is the AG: minimum capital CHF 100,000, of which at least CHF 50,000 paid in. The reasons are concrete:

• non-public shareholding, suited to partners and investors who want confidentiality;
• an institutional image towards banks and international counterparties, decisive because trading lives on credit lines and bank confirmations;
• a structure suited to capital operations and the entry of new partners.

The GmbH, with minimum capital of CHF 20,000, remains possible for smaller operations, but the AG is the industry standard for credibility and flexibility.

Economic substance: the issue that decides everything

A Swiss trading company holds up for tax purposes only if it has real substance in Switzerland: offices, qualified staff, commercial decisions taken on Swiss soil, effective management. A “mere letterbox” structure run from abroad is fragile on two fronts — it can be disregarded by the manager’s country of residence and does not gain access to the conditions enjoyed by a genuinely rooted business.

In trading this translates into precise questions: where are the contracts negotiated? where is the team that manages risk? who decides prices? The answer must be: in Switzerland. Substance is not a formal requirement, it is the condition on which the entire structure stands or falls.

Taxation of profit

The tax on profit and capital in Switzerland is federal, cantonal and municipal: the effective rate varies significantly with the location chosen, with differences of several points between one canton and another. There is no such thing as “the Swiss rate”: there is the rate of the municipality of domicile. For a trading company with margins on high volumes, the choice of location has a significant impact on the net result — but it must be balanced against the availability of talent, banks and logistics infrastructure.

VAT and international trade

VAT deserves attention because in trading the goods often do not physically enter Switzerland. Transactions with foreign countries follow specific rules: many export supplies and transactions between foreign parties are exempt or out of scope, but the classification must be made case by case. The standard domestic rate is 8.1% as of 2024; liability is triggered above CHF 100,000 of turnover, also taking into account foreign-source turnover under the applicable rules. Setting up the VAT treatment of flows correctly is essential to avoid surprises at audit.

Withholding tax on dividends

Dividends distributed by a Swiss company are subject to withholding tax of 35%, recoverable in whole or in part depending on the beneficiary and the applicable double taxation treaties. For a trading company with foreign partners, planning the ownership chain and recovering the withholding tax are elements to be defined from formation onwards.

Accounting and audits

A trading company always exceeds the CHF 500,000 turnover threshold: full double-entry accounting is mandatory. Depending on size, the audit obligation (ordinary or limited) may be triggered. Given the volatility of margins and currency exposure, robust management control is not a luxury: it is part of the trade.

How SIH ONE approaches the topic

SIH ONE’s corporate division structures trading companies starting from the classification of the activity, sizes the substance required, chooses location and corporate form according to tax, banks and talent, and sets up international VAT, accounting and withholding tax treatment. Where the activity touches the regulated financial perimeter, the components subject to authorisation are handled by licensed partners.

Are you considering a trading structure in Switzerland? Let’s talk about your project: we analyse the activity, substance and tax on your real case.