Freelance and Self-Employment in Switzerland
Switzerland is freelance-friendly: the sole proprietorship (Einzelfirma) can be set up in days and there are no mandatory minimum capital requirements. However, self-employed workers lose ALV (unemployment insurance) coverage and must self-pay AHV. Understanding the Swiss setup is essential before making the leap.
- Sole proprietorship: no commercial register entry needed below CHF 100,000 annual revenue.
- Self-employed AHV rate: 9.65% on net profit (vs. combined employee/employer rate of 10.6%, but you pay both sides).
- VAT registration mandatory above CHF 100,000 turnover; standard rate 8.1%.
- GmbH (LLC) requires CHF 20,000 minimum capital but separates personal and business liability.
- Self-employed workers cannot claim ALV (unemployment insurance), a key risk to plan for.
Registering as Self-Employed
The simplest structure is the sole proprietorship (Einzelfirma). No registration required at the commercial register until annual revenue exceeds CHF 100,000. First step: register with the AHV compensation fund (Ausgleichskasse) in your canton, this is mandatory. You declare your income annually and pay AHV contributions on net profit. A GmbH (LLC) requires CHF 20,000 minimum capital, registration in the commercial register, and more compliance, but separates personal and business liability.
AHV, Taxes and VAT
Self-employed AHV: rate is 9.65% on net profit (lower than the combined employee/employer rate of 10.6%, but you pay both sides). You also pay IV and EO contributions. Income tax: declare business income on your personal tax return. VAT: mandatory registration if annual turnover exceeds CHF 100,000. Rate: 8.1% standard, 3.8% accommodation, 2.6% food/books. Note: you cannot claim ALV (unemployment insurance) as a self-employed person, this is a significant risk to plan for.
Contracts and Bogus Self-Employment
Swiss law distinguishes genuine self-employment from bogus self-employment (Scheinselbständigkeit), where a company classifies a dependent worker as a contractor to avoid social security contributions. AHV compensation funds actively audit this. Criteria for genuine self-employment: multiple clients, own tools/premises, bear own economic risk, set own hours. If declared self-employed but working exclusively for one company with their tools and schedule, the AHV may reclassify you as an employee, and the company becomes liable for backdated contributions.
Context on the Swiss job market helps frame any career decision in Switzerland. Our gross-to-net salary guide shows what Swiss gross salaries look like after AVS, LPP and tax deductions. The salary negotiation guide covers how to use market data in offer discussions and which arguments work with Swiss recruiters. Our guide to working in Switzerland as a foreigner covers entry conditions, permit categories and practical relocation steps. The work permit guide explains B, C, G and L permit categories and processing timelines. For cross-sector salary benchmarks, the Switzerland salary guide covers all major roles and cities.
Frequently Asked Questions
Do I need to register a company to freelance in Switzerland?
No. You can freelance as a sole proprietor (Einzelfirma) without registering at the commercial register if turnover is below CHF 100,000. Registering with the AHV compensation fund is mandatory regardless of turnover.
Do freelancers in Switzerland pay unemployment insurance?
Self-employed people do not pay ALV and cannot claim unemployment benefit. This is a key risk of self-employment in Switzerland. Some opt to maintain ALV coverage voluntarily (limited options) or build personal reserves.
What is the difference between a sole proprietorship and a GmbH in Switzerland?
A sole proprietorship has unlimited personal liability, business debts are your personal debts. A GmbH provides limited liability (personal assets protected) but requires CHF 20,000 capital and commercial register entry. Most freelancers start as sole proprietors and consider a GmbH when income grows.
What is the 13th month salary in Switzerland?
The 13th month salary in Switzerland refers to an additional monthly salary paid once a year, typically in December. It is included in annual salary benchmarks as standard: when a Swiss employer quotes CHF 120,000 per year, this normally means 13 monthly payments of approximately CHF 9,231 each, not 12 payments of CHF 10,000. The 13th month is governed by the employment contract or collective agreement (GAV), not by statute. It is subject to social contributions (AHV/ALV) and income tax. Always clarify with a prospective employer whether a quoted annual figure includes or excludes the 13th month.
How do Swiss notice periods work for employment contracts?
Under Swiss law (Code of Obligations, Art. 335c), notice periods during probation (default 1 month, up to 3 months by agreement) are 7 days. After probation, statutory notice periods are: 1 month during the first year, 2 months in years 2 to 9, and 3 months from year 10 onwards. Notice must be given in writing by end of calendar month (or end of the agreed notice period month). Contractual or GAV notice periods can be longer but cannot be shorter than statutory minimums. Protected periods exist (illness, accident, pregnancy) during which termination is suspended or prohibited.
Swiss Code of Obligations (CO Art. 394 ff.) · Federal Law on Old-Age Insurance (AHVG Art. 9) · SECO · admin.ch