Converting a sole proprietor­ship into a GmbH

In effect yes; legally it happens through a new formation. The Merger Act does not provide for the conversion of a sole proprietorship. A GmbH is therefore formed, and the business passes to it with its assets and liabilities as a contribution in kind. If the sole proprietorship is entered in the commercial register, it is deleted at the same time.

CHF 997 excl. VAT, provided the business includes no real estate, for the documents, the organisation and coordination of the notarisation and the notary fees; the same price applies to the AG. The cost of the auditor's audit confirmation, the certification of signatures and the commercial register office fees come on top. These fees are set by the federal fee ordinance, and the office invoices them directly. Private companies repeatedly send invoices that look like those of the commercial register office. You do not have to pay these invoices.

Yes. Anyone contributing a business as a contribution in kind needs the written confirmation of a licensed auditor that the formation report is complete and correct; it is one of the supporting documents filed with the commercial register office. We organise and coordinate the audit; the cost of the audit confirmation is not included. This audit concerns the formation only. Whether the GmbH later needs an auditor for its annual accounts is a separate question.

Not in the standard case. The share capital of at least CHF 20'000 must be paid in full at formation, and you make this contribution with your business; the surplus of assets over liabilities covers the capital. A deposit at a bank is only needed for contributions in cash, for example if the surplus is not sufficient.

The employment relationships pass to the GmbH with all rights and obligations unless the employees refuse the transfer. You inform your employees in good time beforehand about the reason and the consequences. You and the GmbH are jointly liable for employee claims that fell due before the transfer or fall due up to the next ordinary termination date. For a registered sole proprietorship, the asset transfer agreement lists the employment relationships that pass.

As a rule yes, with the addition of the legal form. The company name of a sole proprietorship must contain the owner's surname and may not carry an addition that suggests a company. The GmbH chooses its company name freely, but must state the legal form and differ clearly from the company names of other commercial companies and cooperatives already registered in Switzerland. “Muster Schreinerei” can thus become “Muster Schreinerei GmbH”. We check the name for permissibility and availability as with every formation.

Yes. You can form the GmbH with cash and then sell the business to it, contribute only individual assets such as vehicles or equipment and keep the debts of the sole proprietorship yourself, or transfer the business to a GmbH or AG you already have. These routes differ in what happens to the debts and how the transfer is accounted for.