How can a Hungarian company provide services in Switzerland?
As a Hungarian entrepreneur, you can enter Switzerland with either a temporary or a permanent presence. Learn about company forms, permits, taxation, and the first 12 months of steps.
What legal framework applies to cross-border service provision?
Between Switzerland and the European Union, the Agreement on the Free Movement of Persons (FZA, Freizügigkeitsabkommen, 1999, entered into force in 2002) allows companies from EU member states — including Hungarian businesses — to provide services in Switzerland without Swiss incorporation, subject to certain conditions.
Limits on temporary service provision:
The time spent in Switzerland by workers posted for the same assignment may amount to a maximum of 90 days per calendar year under short-stay status (Kurzaufenthalt).
For postings exceeding 8 days, there is a prior notification obligation via the online system of the State Secretariat for Migration (SEM, Staatssekretariat für Migration) (MELDEPLATTFORM).
In certain regulated sectors (construction, hospitality, cleaning, security services), the 8-day threshold does not apply: notification is required from the first day.
If the activity is regular, long-term, or implies an independent Swiss client base, the authorities may classify the presence as a permanent establishment (Betriebsstätte) — which triggers tax and registration obligations.
Which company forms can a Hungarian entrepreneur choose from?
If you are planning a permanent presence in Switzerland, the following structures are available:
Form | Swiss name | Minimum share capital | Typical use |
|---|---|---|---|
Limited liability company | GmbH (Gesellschaft mit beschränkter Haftung) | CHF 20 000 | Small and medium-sized enterprises, flexible management |
Public limited company | AG (Aktiengesellschaft) | CHF 100 000 (at least CHF 50 000 paid in) | Higher capital requirements, investor structures |
Branch office | Zweigniederlassung | No separate capital requirement | Swiss extension of an existing foreign company |
Sole proprietorship | Einzelfirma | No minimum capital | Only for natural persons with Swiss residence |
For Hungarian entrepreneurs, the most common choice is a GmbH or a branch office (Zweigniederlassung).
A GmbH is an independent Swiss legal entity: the liability of the Hungarian parent company is separate. A branch office is not a separate legal entity — the parent company (the Hungarian Kft. or AG) is liable for the obligations, but the branch can still be registered independently in the Swiss commercial register (Handelsregister).
Registration process in outline:
Check and reserve the company name at the cantonal Handelsregisteramt.
Signing the articles of association (Gesellschaftsvertrag) before a notary.
Paying in the share capital to a Swiss bank account and obtaining the bank deposit confirmation (Einzahlungsbestätigung).
Submitting the registration application — the process typically takes 2–6 weeks.
Registration in the Federal Commercial Register (Zentraler Firmenindex, zefix.ch).
The total legal and notarial fees for setting up a GmbH in Switzerland typically range from 2 000–5 000 CHFdepending on cantonal charges and the notary’s fee schedule.
Which permits and licences are required?
In Switzerland, there is no single “business licence” — licensing requirements depend on the sector and the canton.
Examples of activities requiring a federal permit:
Financial services, investment advice: FINMA (Eidgenössische Finanzmarktaufsicht) authorisation is required.
Pharmacy, medical devices: supervised by Swissmedic.
Food industry, hospitality: permit from the cantonal health authority.
Security services: cantonal police permit.
Construction activities: cantonal building authority, and mandatory participation in the sectoral collective labour agreement (Gesamtarbeitsvertrag, GAV).
Regulated professions and recognition of qualifications:
To practise certain professions (doctor, engineer, auditor, lawyer), foreign qualifications must be recognised. At federal level, the coordinating body for the recognition of EU member state diplomas is SBFI (Staatssekretariat für Bildung, Forschung und Innovation). The process can take 3–12 months.
Cantonal differences:
Licensing requirements vary from canton to canton. Zürich, Geneva and Basel-Stadt generally mean stricter and more detailed administration than smaller cantons. In every case, it is advisable to contact the relevant canton’s Wirtschaftsförderung (economic development) office — these offices provide free preliminary information.
How much does it cost to enter the Swiss market?
The table below is for guidance only, based on 2024–2025 data. Amounts are in Swiss francs (CHF).
Item category | Estimated amount (CHF) | Note |
|---|---|---|
GmbH formation (notary, fees) | 2 000–5 000 | Depends on canton |
Share capital (GmbH) | 20 000 | Can be withdrawn after incorporation |
Legal advice (formation) | 3 000–8 000 | Depends on complexity |
Tax advisor (annual) | 3 000–10 000 | Depends on turnover and structure |
Audit (if mandatory) | 5 000–15 000 | Depends on the size threshold |
Business liability insurance (annual) | 500–3 000 | Depends on the sector |
Office lease (virtual address) | 100–400/month | Higher in Zürich |
Employee registration (AHV/IV) | Administrative | As a percentage of payroll (see below) |
Important: the CHF 20 000 GmbH share capital is not “lost” money — after incorporation, the company can use it as operating capital.
How does recruitment and social insurance work?
If you hire a Swiss employee or second a worker from Hungary, you must register with the Swiss social insurance system (AHV/IV/EO, Alters- und Hinterlassenenversicherung / Invalidenversicherung / Erwerbsersatzordnung).
Employer contributions (2025 figures, for information only):
AHV/IV/EO: approx. 10,6% of gross salary (split equally between employer and employee)
Unemployment insurance (ALV, Arbeitslosenversicherung): approx. 2,2% of gross salary (also split)
Accident insurance (SUVA or private insurer): rate depends on the sector
Second pillar / occupational pension (BVG, Berufliche Vorsorge): mandatory if annual salary exceeds the entry threshold (in 2025, approx. CHF 22 050)
For seconded employees (Entsendung): if the Hungarian employee remains insured in Hungary and the assignment does not exceed 24 months, an A1 certificate is sufficient under the EU–Switzerland social security coordination agreement (issued by the Hungarian NEAK). In this case, no Swiss AHV contributions have to be paid.
Swiss minimum wage: there is no uniform federal minimum wage — some cantons have introduced their own minimum wage. For example, in the canton of Genève, the minimum wage in 2025 was around 24,32 CHF/hour. In some sectors, the collective labour agreement (GAV) sets a mandatory minimum.
What are the financial and tax obligations?
Profit tax (Gewinnsteuer)
In Switzerland, corporate profit tax is levied at three levels: federal, cantonal and municipal. The federal rate is uniform (approx. 8.5% on net profit), while the cantonal and municipal level varies by canton and by year.
The actual combined tax burden (effective tax rate) 11–21% depending on the canton. Among the cantons with the lowest tax burden are Zug, Nidwalden and Appenzell Ausserrhoden; among the highest are Genève and Basel-Stadt.
VAT (MWST, Mehrwertsteuer / TVA, taxe sur la valeur ajoutée)
The Swiss VAT (MWST) system is independent of the EU. Main rates from 2024:
Standard rate: 8.1%
Reduced rate (food, medicine, books): 2.6%
Accommodation services: 3.8%
VAT registration obligation: if annual Swiss turnover exceeds 100 000 CHF, registration with the Federal Tax Administration (ESTV, Eidgenössische Steuerverwaltung) is mandatory. This also applies to foreign companies if they carry out taxable turnover in Switzerland.
Voluntary VAT registration is also possible below 100 000 CHF if reclaiming input tax is justified.
Withholding tax (Quellensteuer)
If a Swiss company pays dividends, interest or royalties to persons resident abroad, a withholding tax deduction obligation may arise. Under the Hungarian–Swiss double taxation agreement (1981, as amended), the withholding tax rate may be reduced — the exact rates depend on the wording of the treaty and the type of income.
What should you pay attention to regarding contracts, data protection and legal risks?
Contracts
In Switzerland, the basis of contract law is the Code of Obligations (OR, Obligationenrecht). As a Hungarian company, it is advisable to clearly stipulate in every Swiss business contract:
The applicable law (Swiss law is recommended if performance takes place in Switzerland).
The competent court or arbitral forum.
The payment terms (a 30-day payment period is common in the Swiss market).
Data protection
Switzerland’s new Federal Act on Data Protection (nDSG, neues Datenschutzgesetz), which entered into force on 1 September 2023, is based on principles similar to the EU GDPR, but it is an independent Swiss statute. If you process the data of Swiss natural persons, the provisions of the nDSG apply to you — regardless of whether the company is headquartered in Hungary.
There is an adequacy decision for data transfers between the EU and Switzerland, which facilitates the flow of personal data from the EU to Switzerland.
Legal risks to prepare for
Employment law disputes: Swiss employment law is strongly employee-friendly; notice periods and severance rules differ from those in Hungary.
Failure to comply with mandatory insurance: failure to register for SUVA or BVG may result in fines and retroactive payment obligations.
Undeclared economy inspections: in construction and hospitality, the authorities regularly check compliance with notification obligations.
What does the schedule for the first 12 months look like?
The following schedule applies to a business starting with a GmbH foundation and an ongoing physical presence in Switzerland. For a temporary cross-border model, the schedule is shorter and simpler.
Period | Task | Responsible / authority |
|---|---|---|
Month 0–1 | Market research, choosing the canton, selecting a lawyer and tax advisor | Entrepreneur |
Month 1–2 | Company name check, preparation of the articles of association, opening a bank account | Lawyer, Swiss bank |
Month 2–3 | Registration of the GmbH with the Handelsregister, payment of share capital | Notary, Handelsregisteramt |
Month 3 | AHV registration (if you hire employees), MWST registration (if required) | AHV-Ausgleichskasse, ESTV |
Month 3–4 | Taking out business liability insurance, SUVA registration | Insurer, SUVA |
Month 4–6 | First Swiss contracts, setting up the invoicing system, starting bookkeeping | Accountant |
Month 6–9 | First quarterly / semi-annual tax prepayment, possible VAT return | ESTV, cantonal tax office |
Month 10–12 | Preparation of the annual closing, consultation with the tax advisor, possible audit | Accountant, auditor |
Sources
Federal Office for Migration (SEM) — notification platform for posted workers: https://www.sem.admin.ch
Federal Tax Administration (ESTV) — MWST registration and taxation: https://www.estv.admin.ch
Federal Commercial Register (Zefix): https://www.zefix.ch
State Secretariat for Education, Research and Innovation (SBFI) — diploma recognition: https://www.sbfi.admin.ch
FINMA — financial market supervision: https://www.finma.ch
SUVA — accident insurance: https://www.suva.ch
Swiss federal portal (general business information): https://www.ch.ch/en/
AHV/IV — social insurance: https://www.ahv-iv.ch
Federal Data Protection and Information Commissioner (EDÖB) — nDSG: https://www.edoeb.admin.ch
In Brief
A Hungarian company can provide temporary services in Switzerland without registering a Swiss entity, but the duration of the posting, prior notification, and sector-specific rules place strict limits on this. If the presence becomes permanent, the authorities may classify it as a Swiss permanent establishment, which triggers registration, tax, and insurance obligations.
Key Takeaways
- Before providing temporary services in Switzerland, it must be checked whether the posting falls within the annual 90-day limit.
- For postings exceeding 8 days, prior notification must be submitted in the SEM online system.
- In construction, hospitality, cleaning, and security services, notification is required from the first day.
- For a lasting or regular presence in Switzerland, it is advisable to consider a GmbH or branch structure.
- VAT registration is required if Swiss turnover exceeds CHF 100,000.
- Contracts should specify the applicable law, the competent court, and the payment terms.
Frequently Asked Questions
Can a Hungarian company operate in Switzerland without setting up a separate Swiss company?
Yes, this is possible in the case of temporary service provision under the EU–Switzerland agreement. However, the service is subject to specific conditions, especially regarding the duration of the posting and the notification obligation.
How long can posted employees work in Switzerland on the same assignment?
According to the article, the time spent in Switzerland may be no more than 90 days per calendar year for the same assignment. If this limit is exceeded, the service can no longer be regarded as simple temporary presence.
When must a posting be notified in advance?
For postings exceeding 8 days, prior notification is required through the SEM online system. In certain regulated sectors, however, notification is mandatory from the first day.
When can Swiss presence be considered a permanent establishment?
If the activity is regular, lasting, or implies an independent Swiss client base, the authorities may classify it as a Betriebsstätte, meaning a permanent establishment. This may create tax and registration obligations.
Which company form is most common for Hungarian entrepreneurs in Switzerland?
According to the article, the most common choices are a GmbH or a branch (Zweigniederlassung). A GmbH is an independent Swiss legal entity, while a branch is not a separate legal entity, so the parent company's liability remains.
When is Swiss VAT registration mandatory?
If annual Swiss turnover exceeds CHF 100,000, VAT registration with the ESTV is mandatory. This also applies to foreign companies if they carry out taxable turnover in Switzerland.
Do posted employees need Swiss social insurance contributions?
Not necessarily. If the Hungarian employee remains insured in Hungary and the posting does not exceed 24 months, an A1 certificate may be sufficient, and in that case Swiss AHV contributions do not have to be paid.
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