Moving abroad while running a business in Switzerland

A specialist article by Samrawi Tecle

Are you the owner of a Swiss LTD and thinking about moving abroad? For Swiss business owners, this aspiration often involves maintaining their company’s operations in Switzerland while personally relocating to another country. Main reasons are a strong customer base in Switzerland or because of the stability of Switzerland’s robust business environment. At the same time, this approach also brings with it a set of unique challenges, including legal compliance, social security issues, and banking regulations. This blog article highlights some key factors.

When moving abroad, you need to consider different perspectives: The LTD as a company, employer – employee relations, and your own perspective as the individual relocating.

Legal and corporate considerations

Swiss law offers a good degree of flexibility for operating a business in Switzerland while living abroad, but certain corporate structures require careful attention. For example, Swiss law mandates at least one resident authorized signatory. This doesn’t mean that you’re handing over your business—many entrepreneurs appoint a trusted local fiduciary or professional director to meet the requirement. What really matters is making sure your company remains fully compliant during your time abroad.

Additionally, banking relationships should be reviewed. Some Swiss financial institutions may adjust their services for businesses that are owned by individuals living abroad, or for clients relocating to specific jurisdictions. For traditional banking, it’s therefore wise to confirm your institutions policies before moving.

For day-to-day management, cloud-based accounting tools or the support of a Swiss fiduciary can help bridge the distance and ensure compliance with VAT and other reporting requirements.

Even if your LTD remains registered in the Swiss commercial registry, you also need to review the rules of your new country of residence. Will the local authorities consider that your LTD has effectively created a permanent establishment (branch) simply because you live and work in that country? This would trigger taxation of the company in your new country of residence.

From now on, you need to comply with both the Swiss regulations and the rules of your new country of residence.

Visa and residency: Finding the right fit

A Swiss passport provides significant mobility, but long-term stays abroad still require the appropriate documentation. Within the EU and EFTA, obtaining a long-term visa is usually straightforward as long as sufficient income is generated. Outside these regions however, the process can be more demanding. Each country has its own requirements—whether minimum stay periods, income thresholds, or investment commitments—so it’s crucial to choose an option which fits both your lifestyle and your business needs. Just as important is securing the proper work permit. Without it, both you and your company face potential risks. This applies even if your work is carried out entirely online for your Swiss company. For tailored guidance on visa options, one of our partners provides specialized advice.

The length of your stay abroad determines whether you will be considered a resident in that country. In addition, as mentioned earlier, your company may also be regarded as having “residency” abroad — even without a formal registration. If you, as the owner and key employee, actively manage the business and carry out core activities in the new country, a permanent establishment (PE) may be created there. This could result in tax liabilities and reporting obligations in the host country. Before you make the final move, seek advise from tax specialists in both Switzerland and your new country of residence —for yourself and your company.

Social security considerations for Swiss entrepreneurs/employees living abroad

One of the most critical—yet often overlooked—aspects of relocating abroad is its impact on your Swiss social security coverage. Switzerland’s social security system, including pensions (AHV/AI), disability insurance, and healthcare, is primarily designed for residents. Once you move abroad, your status changes, and so do your rights and obligations.

You will have to take key decisions about social security and insurance coverage. There are specific options and considerations available if you wish to remain affiliated with the Swiss system while residing outside of the country.

When you are employed by your LTD, there are two main approaches. The first is for the company itself—or an employer of record—to hire you based on a local contract of the destination country. The second option is for your enterprise to formally second you to the host country. Each framework carries distinct legal and administrative implications, and the right choice depends on the specific circumstances of your relocation.

Through local employment, you become integrated into the host country’s social security system. If you are seconded abroad by your Swiss LTD, you typically remain covered under the Swiss social security system. However, secondment status must be officially requested and approved, and specific conditions need to be met. In addition, the applicable rules will differ significantly depending on where you relocate.

The impact on your Swiss social security and pension rights largely depends on your new country of residence. If you move within the EU/EFTA, one set of rules applies – though there are some local specificities, e.g. in respect to labor law; if you move outside of the EU/EFTA, it depends on whether Switzerland has signed a social security agreement with that country. The legal frameworks and available agreements can vary considerably, influencing your coverage and future entitlements.

All secondment rules share certain core requirements: the individual must have been insured under the Swiss AHV/AVS system immediately prior to departure, must work exclusively for the Swiss employer during the assignment (i.e., without a local employer or reassignment), and the assignment must be temporary in nature.

Relocating to the EU/EFTA – local contract vs secondment

If you relocate to an EU/EFTA country under a local employment contract, you become fully integrated into that country’s social security system. As a result, your affiliation with the Swiss AHV/AVS, occupational pension scheme (BVG/LPP) and Swiss health insurance ends. In such cases, your accumulated occupational pension assets are transferred to a vested benefits account, where they remain until a qualifying event occurs. Under certain conditions, it is also possible to withdraw part or all of the capital. For more details, feel free to inquire.

In contrast, if you are seconded to an EU/EFTA country, your Swiss social security coverage — including health insurance — can generally be maintained for up to 24 months, with the possibility of an extension.

As part of the secondment procedure, you must request an A1 posting certificate, initially valid for up to 24 months. Non‑working family members accompanying the posted employee also remain covered under Swiss social security and compulsory health insurance (LAMal). Under the A1 arrangement, you are not required to contribute to social security in the host country. However, this also means you will not be entitled to local benefits there.

Relocating outside of the EU/EFTA – local contract

If you move to a non-EU/EFTA country and opt for a local contract, you are subject to the social security rules of your new country of residence and must pay contributions accordingly. As a Swiss or EU national, you may under certain conditions voluntarily remain affiliated with the Swiss AHV/AVS. This requires that you were insured the last five consecutive years immediately prior to your departure, and that you submit your request within one year of moving. You have the choice whether to move your capital from the 2^nd pillar to a vested benefits account or to seek a full cash withdrawal. Financial aspects including taxation issues have to be carefully evaluated.

Private international health insurance is often recommended when moving to a non-EU/EFTA country. These policies are subject to acceptance and medical underwriting, and they may exclude pre-existing conditions. It is strongly advised to arrange coverage before deregistering from Switzerland, as post-departure enrollment in international policies from Swiss providers is not allowed.

Relocating outside of the EU/EFTA – Secondment to a country with a social security agreement

If you want to remain in the Swiss social security system, it can be advantageous to have your LTD second you to the host country. Where Switzerland has a bilateral social security agreement, such as with the U.S., Canada, Japan, and Australia, continued Swiss social security coverage typically extends up to five or six years, depending on the terms of the specific agreement. In such cases, seconded employees must remain covered by all key Swiss social insurance schemes: old-age and survivors’ insurance (AHV/AVS), occupational pension (BVG/LPP), accident insurance (UVG/LAA), and mandatory health insurance (KVG/LAMal). In the host country, exemptions apply only to the branches covered by the agreement. Local coverage may still be required for excluded branches such as health or unemployment insurance.

Relocating outside of the EU/EFTA – Secondment to a country without a social security agreement

If you are seconded to a country without a bilateral social security agreement with Switzerland, your secondment status can be recognized by Switzerland but not necessarily by the host country. As a result, you may be required to pay social security contributions as employer and employee in both Switzerland and the host country. You may apply for the secondment, i.e., for voluntary continuation of the mandatory AHV/AVS coverage, provided you were insured in Switzerland for five consecutive years immediately prior to leave. This application must be submitted within six months of leaving. Under this arrangement, you can maintain coverage for AHV/AVS, and BVG/LPP for the entire period of employment, while health insurance is limited to a period of six years.

Some Swiss health insurers offer specific premiums for secondments. Remaining in the Swiss mandatory health insurance does not necessarily exempt you from joining the mandatory health insurance scheme in your country of residence. In such cases, an exemption from Swiss mandatory health insurance may be requested, subject to certain conditions.

Additional issues to consider

There are a number of additional issues to consider, including data protection. When working for your LTD from abroad, data protection becomes a critical issue, especially when sensitive, personal data is involved. The Federal Data Protection and Information Commissioner (FDPIC) warns that transferring personal data to countries lacking adequate data protection can compromise the privacy of data subjects. Even with standard contractual clauses, additional safeguards might be necessary. If these measures prove insufficient, the FDPIC advises that the data transfer should not take place.

The FDPIC’s policy paper on the implications of the Schrems II decision further underlines the risk. When transferring data to countries not listed as providing adequate protection, companies must conduct a comprehensive risk assessment. This includes evaluating whether data protection rights can be effectively upheld, particularly where local laws permit public authorities access to personal data.

These official positions indicate that relocating to a jurisdiction with insufficient data protection could jeopardize your ability to maintain remote operations. Non-compliance with Swiss data protection laws may lead to legal liabilities..

Depending what data you need for your work, your choice of destinations may be limited. In such cases, particular care must be taken to ensure data security.

In particular in regard to social security, owning an LTD offers you opportunities. With strategic planning and expert advice, you can ensure your Swiss business remains compliant as you embrace life abroad. For personalized guidance, consulting an expatriate specialist is highly recommended.