Switzerland boasts scenic lakes, eye-catching mountain ranges, unique traditions, and many other tourist attractions that attract thousands of visitors each year. No wonder the hotel industry is also experiencing a significant boom when the number of travelers peaks. Besides receiving tourists with great interest in the stunning locations, the country also sees many business travelers from all over the world due to its status as a global business hub. This makes starting a hotel business in Switzerland a viable option.
This blog provides information about the requirements and process for setting up a hotel in Switzerland. Let’s dive deep and learn more.
Pick the Optimal Legal Entity for Your Hotel Business
As a business haven, Switzerland is famous for its tax incentives, business-friendly regulations, and strong privacy laws. First and foremost, you will need to choose a legal entity type for your hotel, as any business in the country must be conducted through a legal entity. After selecting the correct legal entity, you can proceed with company registration in Switzerland.
The GmbH or limited liability company in Switzerland is an ideal and convenient choice for investors looking to kick-start a hotel business. A GmbH is a limited liability company that can conduct a wide range of commercial activities, including in the service sector.
A GmbH requires a minimum share capital of 20,000 CHF (Swiss Francs) with one or more shareholders. However, at least one of the company's directors must be a Swiss national.
What Are Business Permits for Hotels in Switzerland?
After choosing the appropriate Swiss company structure for the hotel, foreign investors will need to obtain all necessary permits to operate the hotel. The licenses serve to authenticate the sole fact that the hotel's activities are in line with the local laws and legislation applicable to accommodation units.
If you wish to build a brand-new hotel from the ground up, you will require a construction permit issued by the Municipal Building Authority. You will also need to submit the building plans to obtain the construction permit. After the construction has begun, the Municipal Building Authority will conduct inspections for excavation and scaffolding.
Before starting a hotel business in Switzerland, you will also need to obtain a fire permit from the fire department. This permit ensures the building meets strict safety standards for guests and staff, verifying that adequate fire alarms, extinguishers, emergency exits, and evacuation plans are in place.
Aside from this, the hotels must comply with the Swiss Federal Act on Foodstuffs and Utility Articles (if serving food). Moreover, they must also obtain employment and social insurance registration for staff.
Furthermore, Hotels must comply with municipal waste disposal regulations, as all businesses must collect waste in according to the predetermined procedures. Moreover, all compliance is handled under local municipal rules.
Other approvals include electrical, water, sewage, and sanitary approvals. Finally, as an investor in the hotel industry, you will need a special business license to successfully incorporate a company in Switzerland.
Taxation Rules for Hotel Businesses in Switzerland
One of the reasons behind so many foreigners investing heavily in various businesses in Switzerland is its flexible tax regime. The country boasts one of the lowest VAT rates across the world, and the VAT registration is mandatory if the turnover exceeds CHF 100,000.
The standard VAT rate in the country is 8%. However, businesses in the hotel and other accommodation sectors can obtain a VAT rate as low as 3.8%.
Other Significant Details about the Hotel Industry in Switzerland
Hotels in Switzerland operate based on a 1-5 star system. One star is awarded to hotels that meet the basic requirements. Meanwhile, five-star hotels are more luxurious. The official classification is overseen by HotellerieSuisse.
Switzerland also boasts some of the best schools in the field of hospitality, which means that investors can take their pick from a highly skilled workforce at their disposal.
Tourism in Switzerland is expected to make a stellar return after a dismal 2020, implying that the hotel industry will also see a surge in profits. Thus, the time to invest in the hotel industry is now. Get in touch with us today to learn more about the additional activities, such as starting a franchise business in Switzerland.
