Income tax in Switzerland (canton of Zurich)
Before opening a business in Switzerland, it is recommended to get acquainted with the income taxes in Switzerland (canton of Zurich). Opening a company in this country is relevant, as the jurisdiction is reputable and has a positive reputation, characterized by a stable and developed economy.
There is a possibility of using a special tax regime, which was designed to attract investment and encourage existing businesses. The most popular canton for company registration is Zurich.
Payment of income tax in Zurich
Switzerland includes 26 cantons. There is no standard rate, and the effective rate is calculated according to a special formula, taking into account the location of the company. The federal income tax is charged at a rate of 8.5%, which can be reduced if certain requirements are met. The cumulative corporate tax rate, taking into account federal, municipal and cantonal levies, can average up to 24%.
To legally reduce income tax in the canton of Zurich in 2021, the opening of holding, investment, and trading companies is relevant. In order to use the benefits, compliance with applicable regulations is required.
The combined income tax rate in Zurich is 19.7%, and the rate can be reduced slightly. This rate includes all levels of taxation. In Zurich it is possible to use the double taxation avoidance provisions.
Is it worth registering a company in Zurich?
To choose the jurisdiction where it is most profitable to register a business, contact our experts at IT-OFFSHORE. Switzerland is one of the most sought-after countries where investors and businesspeople want to start a company. This state is prestigious, and it is possible to move with your family and get permanent residency.
There is no royalty tax in Zurich. Swiss companies may be entitled to a deduction of up to 10% of taxable income in reserve capital and up to 80% on investments that were made during the purchase of the property. It is possible to obtain deductions for research expenses.
It is enough to open a bank account, which preserves the bank secrecy and privacy of the owner. However, to register a company, you will need a significant investment of capital, and tax rates are relatively high.