First of all, you should understand the difference between self-employed and sole proprietorship. Self-employed is an employment status, and sole proprietorship is the entity of your company.
In Switzerland, and in terms of social insurance, you are self-employed if:
- you work for and on your behalf,
- you are independent in your work,
- you assume the financial risk
But you should be careful and aware that some activities or professions are regulated, and you must fill in an application form for authorization.
- For regulated activities, no specific qualifications are required. Contact the relevant offices or departments (Liste des professions/activités réglementées en Suisse (in French only)).
- For regulated professions (such as notary, doctor, etc), specific training must be completed or experience in the sector must be proven.
If you want to have your self-employment status recognized, you need to submit a complete application form to the compensation office (available on the website). With this form, you should give the following documents, which will prove that you have already started:
- invoices already issued
- business expenses done
- agreements already done
- offers already made
- a lease, or
- a Certificate of Civil Liability Insurance
- business card, flyers, or website
Then, the compensation office checks whether the status can be granted or not.
It is recommended that you get your self-employed status recognized in the first few months of your activity.
Once the Compensation Office has granted your Self-employed status, you do not need to register the business with the Commercial Register. For sole proprietorships, registration is mandatory once you reach a turnover of CHF 100.000. Registration also entails obligations, such as keeping accounts and being subject to debt collection under bankruptcy proceedings (Handelsregister: Rechte und Pflichten für KMU (in German only)).
Once you register yourself as self-employed with the compensation office, you start contributing to the 1st pillar of the pension system.
Self-employed persons are not subject to the mandatory professional insurance scheme and are therefore free to determine how they handle their protection. Therefore, contributing to the 2nd pillar of the insurance system is optional.
Self-employed persons making revenue of more than CHF 100,000 are subject to VAT, except in certain sectors (for example, insurance, health, or farming).
If you are only starting, maybe this is the way to go.
If you have any questions, please send me an email at firstname.lastname@example.org
Header image sourced from Unsplash: Andrew Neel