Founding a GmbH or an AG in Switzerland: how to choose

The GmbH (Gesellschaft mit beschränkter Haftung) and the AG (Aktiengesellschaft) are the two capital companies of Swiss law, and between them they cover nearly every serious business project in the country. Both shield the owners' private assets, both can be founded by a single person of any nationality, and both are taxed identically. The differences that actually decide the question sit in five places: capital, anonymity, governance, share transfers and market perception.

The short answer

The GmbH is the lean, owner-managed vehicle: low capital, direct control, full transparency of ownership. The AG is the capital-market-ready vehicle: higher capital, a board structure, anonymous shareholders and the strongest brand perception Swiss company law has to offer. If CHF 100,000 is comfortably available and privacy or investors matter, take the AG; if you want the fastest, cheapest limited-liability start, take the GmbH — and convert later if growth demands it.

GmbH and AG at a glance

Capital: CHF 20,000 versus CHF 100,000

Share capital is the loudest difference and the least understood one. The GmbH's CHF 20,000 must be paid in fully before notarisation; the AG's CHF 100,000 may be paid in at 50% — so the real cash difference at formation is CHF 20,000 versus CHF 50,000, not versus CHF 100,000. Two practical points founders often miss:

• The capital is working capital, not a deposit. After registration, the blocked account is released and the money pays for laptops, stock and salaries. It is not frozen.
• Partial payment of AG capital is a personal risk. Shareholders remain liable for the unpaid half; in bankruptcy, the administrator will call it in. Many advisers recommend paying in the full CHF 100,000 once liquidity allows.

Capital can be increased in either form later, and an AG can also create capital bands for flexible increases — relevant for investor rounds.

Anonymity and the commercial register

The commercial register treats the two forms very differently, and for many founders this single point decides the question. Every GmbH shareholder is entered in the public register with name, residence and quota — visible to any competitor, client or journalist via a free Zefix search, and every later share transfer updates the public record. The AG's shareholders, by contrast, appear nowhere in the register: the company keeps an internal share register and records beneficial owners under anti-money-laundering rules, but the public sees only the board of directors. Bearer shares were abolished in 2019 for unlisted companies, so AG shares are registered shares today — anonymity applies towards the public, not towards authorities. How register entries, extracts and Zefix searches work in practice is covered in our guide to the Swiss commercial register.

Governance and transferring ownership

Governance in the GmbH is built around persons: by default every shareholder is entitled to manage, decisions concentrate in the shareholders' meeting, and transferring a quota requires a written assignment, approval by the shareholders' meeting and an updated register entry. That friction is deliberate — the GmbH is designed for stable, known ownership circles such as families and founder teams.

The AG separates ownership from management: the general meeting elects a board of directors, the board runs or delegates the business, and registered shares change hands by simple assignment or endorsement with no notary and no register filing. Statutes can restrict transfers (Vinkulierung), but the default is transferability — which is precisely why investors, employee-participation plans and succession solutions run more smoothly in an AG.

Both forms share one constraint: at least one signatory resident in Switzerland (Art. 718 para. 4 and Art. 814 para. 3 OR). Foreign-controlled companies routinely meet it through a fiduciary resident director.

Taxes: no difference — but one stamp duty threshold

Corporate taxation ignores the GmbH/AG label entirely. Both pay federal, cantonal and communal profit tax at combined effective rates of roughly 11–21% depending on canton (as of 2026), plus a small cantonal capital tax. Dividends to owners carry 35% withholding tax, reclaimable by Swiss residents and reduced under most double taxation treaties; owners holding at least 10% enjoy partial dividend taxation privately. One threshold applies equally to both: the 1% issuance stamp duty on equity contributions above CHF 1 million. Details and current cantonal rates are on our Swiss corporate taxes page — the message here is simply that tax is the wrong reason to pick one form over the other.

Which form for which scenario

• Solo consultant or small agency → GmbH. CHF 20,000 buys full limited liability; transparency rarely hurts a service business.
• Family business with several owners → GmbH. Transfer restrictions and personal governance match the ownership logic.
• Startup planning investor rounds → AG. Share classes, capital band, easy transfers and the structure VCs expect.
• Owner who values privacy → AG. Shareholding stays off the public record — relevant for wealthy individuals and quiet market entries.
• Foreign group establishing a subsidiary → both work; groups choose the AG for standing or the GmbH to keep capital light. See our dedicated pages on the Swiss GmbH and the Swiss AG for form-specific detail.
• Regulated or finance-adjacent business → AG. Counterparties and licensing authorities are simply more accustomed to it.

Switching later: GmbH to AG

A change of legal form is not a restart. The Merger Act allows a GmbH to convert directly into an AG — no liquidation, no new legal entity, contracts and the commercial register history continue. The practical requirements: raise capital to CHF 100,000, obtain an audit confirmation of the balance sheet, notarise the conversion resolution. Costs are modest compared to a fresh formation, and the path "found a GmbH now, convert at the growth stage" is standard Swiss practice — which takes most of the pressure out of today's decision.

When neither GmbH nor AG fits

A capital company is not always the right answer. A freelancer with low liability risk and no hiring plans may be better served by a sole proprietorship — no capital requirement, minimal formalities, though with unlimited personal liability and a public register entry once revenue reaches CHF 100,000. A foreign company that only needs a Swiss presence, not a Swiss legal entity, should compare the branch office route before committing capital. And anyone still weighing jurisdiction itself should read the comparison for founding as a foreign entrepreneur first — legal form is the second decision, not the first.

Bottom line: choose the GmbH for a lean, controlled start; choose the AG for capital, anonymity and investor readiness; and remember the conversion route means no choice is final.