Go Back   English Forum Switzerland > Living in Switzerland > Business & entrepreneur  
Reply
 
Thread Tools Display Modes
  #1  
Old 26.10.2021, 23:18
Newbie
 
Join Date: Oct 2021
Location: Zurich
Posts: 1
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
ajska has no particular reputation at present
Contractor setup - need a lawyer/bookkeeper

Hi,


I am a software engineer, and I recently got several offers that are above my current salary, but would require me to act as contractor.


I was wondering what would be the best legal form to do so. I don't speak German that well so I would just prefer to hire a professional to do all bookkeeping.


There is one thing however - I understand that as contractor I would be liable for any damages up to my entire wealth. Is there a way to limit such responsibility? Either by legal entity or via insurance? Like I don't plan on stealing trade secrets, but mistakes happen and I don't want to start all over in 5 years if one happens to me.

So - who can do the setup and bookkeeping for me? How much such service typically cost? Is there a way to limit personal responsibility against non-willful harm?
Reply With Quote
  #2  
Old 27.10.2021, 10:23
Mullhollander's Avatar
Forum Legend
 
Join Date: Dec 2012
Location: Aargau
Posts: 2,627
Groaned at 10 Times in 9 Posts
Thanked 3,707 Times in 1,625 Posts
Mullhollander has a reputation beyond reputeMullhollander has a reputation beyond reputeMullhollander has a reputation beyond reputeMullhollander has a reputation beyond reputeMullhollander has a reputation beyond reputeMullhollander has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Following the KISS principle, if your clients are willing to work with an individual contractor, it could be possible to start your business as a sole trader/ self-employed (Einzelfirma) and then later take a decision on whether to incorporate the business into a legal entity (GmbH/ AG). If liability is a concern, insurance could be purchased to cover this risk. (Some household policies automatically cover liability up to a smallish limit, say, Fr. 15'000 revenues as a secondary occupation).


Some additional comments:
1. Contact SVA Zurich to register for social security purposes as self-employed (selbständig).
2. SVA Zurich should normally then obtain a UID enterprise number for you.
3. Consider registering with the commercial register (Handelsregister), which will be required at any rate when annual revenues exceed Fr. 100'000.
4. Review whether it might be worthwhile to register for VAT under the smiplified reporting method. VAT registration will be required when annual revenues exceed Fr. 100'000 (and sometimes earlier, if quarterly revenues exceed Fr. 25'000).


If your business has few fixed assets, it can be possible to maintain your accounts with a Profit & Loss statement rather than with full financial statements. If few transactions are expected, it might also be possible to use your personal bank account for your business. Otherwise, it is often better to set up a separate business account.


Just some thoughts.
Reply With Quote
  #3  
Old 27.10.2021, 10:37
NotAllThere's Avatar
Modulo 2
 
Join Date: Oct 2008
Location: Baselland
Posts: 14,144
Groaned at 254 Times in 222 Posts
Thanked 20,990 Times in 8,530 Posts
NotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Simplest is to work through a payroll company. As far as liability is concerned, professional indemnity insurance is what you need. Talk to any broker.
Reply With Quote
  #4  
Old 27.10.2021, 10:40
Mica's Avatar
Forum Veteran
 
Join Date: Oct 2007
Location: Zurich
Posts: 927
Groaned at 1 Time in 1 Post
Thanked 1,185 Times in 525 Posts
Mica has a reputation beyond reputeMica has a reputation beyond reputeMica has a reputation beyond reputeMica has a reputation beyond reputeMica has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Three things you can do:
- limitation of liability clauses, i.e. exclude liability for damages as far as possible (both in terms of fault, i.e no liability for negligence, in terms of type of damages, i.e. no consequential damages/no loss of profits/etc., and in terms of amount, i.e. capped at amount XX. However, generally you cannot exclude liability for gross negligence or wilful intent and this also applies to any indirect limitations, i.e. amounts/type of damages;
- professional liability insurance, i.e. insurance in case something does happen. You just need to be sure that it will cover your activity (e.g. also claims against copyright infringement, etc.) and has a sufficient coverage amount;
- setting up a legal entity which will be the contracting entity and thus should limit any direct claims (it is not complete protection since there might still be some claims that can be made, e.g. directors liability or clawback actions if you take out money prior to bankruptcy, or any non-contractual claims, i.e. claims based on tort etc.).

If you intend to provide services in a business area in which a minor fault can have large consequences, I would presumably go for all three. Of course it comes with costs (set-up, premiums, taxes and social security).
__________________
Liability for any statements hereinabove excluded! - Need a Swiss lawyer PM me.
Reply With Quote
  #5  
Old 27.10.2021, 12:40
robBob's Avatar
Forum Legend
 
Join Date: Mar 2012
Location: Zurich
Posts: 3,017
Groaned at 65 Times in 50 Posts
Thanked 2,907 Times in 1,543 Posts
robBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Can try this place: https://www.accurity.ch/
Reply With Quote
  #6  
Old 27.10.2021, 15:29
Jim2007's Avatar
Forum Legend
 
Join Date: Jun 2006
Location: Kt. Bern
Posts: 4,674
Groaned at 229 Times in 180 Posts
Thanked 7,686 Times in 3,398 Posts
Jim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
Hi,


I am a software engineer, and I recently got several offers that are above my current salary, but would require me to act as contractor.


I was wondering what would be the best legal form to do so. I don't speak German that well so I would just prefer to hire a professional to do all bookkeeping.


There is one thing however - I understand that as contractor I would be liable for any damages up to my entire wealth. Is there a way to limit such responsibility? Either by legal entity or via insurance? Like I don't plan on stealing trade secrets, but mistakes happen and I don't want to start all over in 5 years if one happens to me.

So - who can do the setup and bookkeeping for me? How much such service typically cost? Is there a way to limit personal responsibility against non-willful harm?
Just use a payroll company, it is the cheapest and easiest solution in the long run.
Reply With Quote
  #7  
Old 27.10.2021, 15:53
Forum Veteran
 
Join Date: Jul 2014
Location: lugano
Posts: 840
Groaned at 102 Times in 61 Posts
Thanked 732 Times in 405 Posts
DL21 has earned the respect of manyDL21 has earned the respect of manyDL21 has earned the respect of many
Re: Contractor setup - need a lawyer/bookkeeper

don't use a sole trader. you'll pay way more tax as dividends aren't possible. use a capital company and half your income can be dividends.
Reply With Quote
  #8  
Old 27.10.2021, 16:00
NotAllThere's Avatar
Modulo 2
 
Join Date: Oct 2008
Location: Baselland
Posts: 14,144
Groaned at 254 Times in 222 Posts
Thanked 20,990 Times in 8,530 Posts
NotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
don't use a sole trader. you'll pay way more tax as dividends aren't possible. use a capital company and half your income can be dividends.
There's no tax relief on dividends. The only savings with dividends are reduced social contributions, and the chance of income levelling across years.

Wrong.

Last edited by NotAllThere; 28.10.2021 at 13:14.
Reply With Quote
  #9  
Old 27.10.2021, 16:50
Forum Veteran
 
Join Date: Jul 2014
Location: lugano
Posts: 840
Groaned at 102 Times in 61 Posts
Thanked 732 Times in 405 Posts
DL21 has earned the respect of manyDL21 has earned the respect of manyDL21 has earned the respect of many
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
There's no tax relief on dividends. The only savings with dividends are reduced social contributions, and the chance of income levelling across years.
yeah but it's recoverable. don't fully understand it either but talk to an accountant. mine was quite clear on it. massive saving not being an independent.
Reply With Quote
  #10  
Old 27.10.2021, 17:18
NotAllThere's Avatar
Modulo 2
 
Join Date: Oct 2008
Location: Baselland
Posts: 14,144
Groaned at 254 Times in 222 Posts
Thanked 20,990 Times in 8,530 Posts
NotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
yeah but it's recoverable. don't fully understand it either but talk to an accountant. mine was quite clear on it. massive saving not being an independent.
Always worth talking to an accountant. I think the circumstances have to be quite specific. And probably vary from Canton to Canton!
Reply With Quote
  #11  
Old 27.10.2021, 17:22
robBob's Avatar
Forum Legend
 
Join Date: Mar 2012
Location: Zurich
Posts: 3,017
Groaned at 65 Times in 50 Posts
Thanked 2,907 Times in 1,543 Posts
robBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond reputerobBob has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
Always worth talking to an accountant. I think the circumstances have to be quite specific. And probably vary from Canton to Canton!
Average accountant will cost one around 200 SFr an hour. Not always worth it! OP only needs a payroll company like what I recommended.
Reply With Quote
This user would like to thank robBob for this useful post:
  #12  
Old 27.10.2021, 17:41
NotAllThere's Avatar
Modulo 2
 
Join Date: Oct 2008
Location: Baselland
Posts: 14,144
Groaned at 254 Times in 222 Posts
Thanked 20,990 Times in 8,530 Posts
NotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
Average accountant will cost one around 200 SFr an hour. Not always worth it! OP only needs a payroll company like what I recommended.
As did I! Sorry, my meaning was that if the OP goes down self-employed/gmbh/ag route, then talk to an accountant. Otherwise - nah! If I were to go contracting again (seems unlikely since I know where the directors buried the bodies), I'd go payroll. As it worked out though, gmbh was the right choice for me.
Reply With Quote
  #13  
Old 27.10.2021, 21:40
Forum Veteran
 
Join Date: Jul 2014
Location: lugano
Posts: 840
Groaned at 102 Times in 61 Posts
Thanked 732 Times in 405 Posts
DL21 has earned the respect of manyDL21 has earned the respect of manyDL21 has earned the respect of many
Re: Contractor setup - need a lawyer/bookkeeper

Difference between 35% and 19% tax on 1’000’000 chf of income is well worth hiring an accountant for….
Reply With Quote
  #14  
Old 27.10.2021, 21:45
Forum Legend
 
Join Date: Oct 2014
Location: SG
Posts: 9,491
Groaned at 500 Times in 371 Posts
Thanked 12,590 Times in 6,542 Posts
Urs Max has a reputation beyond reputeUrs Max has a reputation beyond reputeUrs Max has a reputation beyond reputeUrs Max has a reputation beyond reputeUrs Max has a reputation beyond reputeUrs Max has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
There's no tax relief on dividends. The only savings with dividends are reduced social contributions, and the chance of income levelling across years.
Of course there is, provided you own at least 10% of the company's capital.

For the federal income tax, 70% of the dividends count as income and are taxed (30% rebate). The details for the cantonal/communal level will differ by Canton, 30-50% rebate used to be common until STAF got implemented last year, that may be a bit less now.
Reply With Quote
The following 3 users would like to thank Urs Max for this useful post:
  #15  
Old 27.10.2021, 23:29
Jim2007's Avatar
Forum Legend
 
Join Date: Jun 2006
Location: Kt. Bern
Posts: 4,674
Groaned at 229 Times in 180 Posts
Thanked 7,686 Times in 3,398 Posts
Jim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
don't use a sole trader. you'll pay way more tax as dividends aren't possible. use a capital company and half your income can be dividends.
This is not the case. There is only one advantage in having ones own company over using a payroll company and to take advantage of one would need to work through it and retire in Switzerland.

Your idea could cost the significantly more in income tax as well as being them into the wealth tax net because of the way a company is valued by the tax authorities.
Reply With Quote
  #16  
Old 28.10.2021, 11:45
Member
 
Join Date: Sep 2017
Location: Luzern
Posts: 121
Groaned at 5 Times in 4 Posts
Thanked 73 Times in 36 Posts
memihai is considered knowledgeablememihai is considered knowledgeablememihai is considered knowledgeable
Re: Contractor setup - need a lawyer/bookkeeper

Use a payroll umbrella company.
Explanation: There are companies in CH which will only take you as an contractor if you are behind one of the umbrella companies on a special list.

Contractor in CH is not like contractor with self paying all contributions and having an accountant. it works in IT over payroll companies.

Quote:
View Post
Hi,


I am a software engineer, and I recently got several offers that are above my current salary, but would require me to act as contractor.


I was wondering what would be the best legal form to do so. I don't speak German that well so I would just prefer to hire a professional to do all bookkeeping.


There is one thing however - I understand that as contractor I would be liable for any damages up to my entire wealth. Is there a way to limit such responsibility? Either by legal entity or via insurance? Like I don't plan on stealing trade secrets, but mistakes happen and I don't want to start all over in 5 years if one happens to me.

So - who can do the setup and bookkeeping for me? How much such service typically cost? Is there a way to limit personal responsibility against non-willful harm?
Reply With Quote
  #17  
Old 28.10.2021, 13:16
NotAllThere's Avatar
Modulo 2
 
Join Date: Oct 2008
Location: Baselland
Posts: 14,144
Groaned at 254 Times in 222 Posts
Thanked 20,990 Times in 8,530 Posts
NotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond reputeNotAllThere has a reputation beyond repute
Re: Contractor setup - need a lawyer/bookkeeper

Quote:
View Post
Of course there is, provided you own at least 10% of the company's capital.
I stand corrected. Post above edited.
Quote:
View Post
Use a payroll umbrella company.
Explanation: There are companies in CH which will only take you as an contractor if you are behind one of the umbrella companies on a special list.
Not umbrella companies per se, but agencies. Some agencies will quite happily place GmbH contractors.
Reply With Quote
Reply




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Bookkeeper/Accountant TonyT Jobs offered 2 26.06.2020 09:08
New business setup Theone Business & entrepreneur 16 20.04.2018 18:02
Salaries- Lawyer, Compliance O., In hpuse Lawyer Reto Ueli Employment 2 22.02.2013 13:04
paypal setup caninsui Finance/banking/taxation 3 25.01.2011 12:25
Bookkeeper in Lugano luke Finance/banking/taxation 2 17.08.2008 20:27


All times are GMT +2. The time now is 05:10.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0