Starting activities in Solothurn: costs and procedure

Context

In brief

• Mandatory registration with the commercial register
• Three levels of taxation: federal, cantonal, municipal
• AVS and pension obligations if there is an employee
• LAMal mandatory within 3 months, deductibles from CHF 300–2'500

Key facts

• What: Starting a business in the canton of Solothurn
• Where: Cantonal commercial register office of Solothurn
• Who: Entrepreneurs, LLCs, PLCs, sole proprietorships
• Employee AVS contributions: 5.3% (10.6% total with employer)
• LAMal obligations: Within 3 months of starting activity
• Tax levels: Federal (IFD) + cantonal + municipal Solothurn
• LPP contributions: 7–18% coordinated salary according to age
• SUVA: 0.7–1.5% according to economic sector

Starting a business in the canton of Solothurn requires compliance with well-defined federal, cantonal, and municipal obligations. The Swiss tax structure is divided into three levels: the federal direct tax (IFD) is fixed at the national level, while the canton of Solothurn applies a cantonal rate and each municipality its own multiplier. This system implies that each entrepreneur is subject to cumulative taxation based on personal and business income.

Registration with the commercial register is the administrative foundation: without it, no activity can proceed legally in the canton. Simultaneously, anyone wishing to operate must activate mandatory health insurance (LAMal) within 3 months of starting the activity. This obligation applies to every resident in Switzerland, including entrepreneurs, and is non-negotiable. LAMal covers health risks with deductibles ranging from CHF 300 to CHF 2'500 for adults, with individual premiums varying according to age and canton of residence. The canton of Solothurn may offer premium reductions (subsidies) based on income.

Anyone with an employee faces immediate pension obligations. The employer pays 5.3% of AVS/AI/IPG contributions for each employee (the employee in turn pays 5.3%, for a total of 10.6%). To these are added SUVA contributions (professional accident insurance, 0.7–1.5% according to the economic sector) and unemployment/professional illness insurance contributions (1.1% up to an annual maximum set at the federal level).

Legal forms and liability

The choice of legal form — sole proprietorship, limited liability company (LLC), or public limited company (PLC) — determines civil liability, administrative complexity, and compliance burden. Sole proprietorships offer maximum operational simplicity but expose the owner to unlimited liability: in case of business debts, personal assets are at risk. LLCs and PLCs limit liability to the capital contributed, protecting the personal assets of shareholders and partners. Commercial registration is mandatory for all forms and must be completed at the competent cantonal office in Solothurn within deadlines set by federal law.

Operational details

The entrepreneur who opens a business in Solothurn encounters a three-tier tax structure. The direct federal tax is fixed at the national level according to federal rates. This is added to the cantonal tax of Solothurn, which applies its own rate, multiplied finally by the municipal coefficient: the result is an effective rate that varies not only between cantons but also between municipalities within the same canton. This combination generates a unique tax burden for each jurisdiction. For those with employees, the pension obligations are non-negotiable and generate a fixed personnel cost. The employer pays 5.3% of AVS/AI/IPG (the employee pays the same amount); 0.7–1.5% for SUVA depending on the sector; 1.1% for unemployment and professional health insurance up to an annual maximum. If the entrepreneur has at least one employee, they are required to contribute to professional pension provision (LPP/BVG): the employer pays a percentage of the coordinated salary that varies from 7% (25–34 age bracket) to 10% (35–44 years), 15% (45–54 years), and 18% (from 55 years until the reference age for retirement). Every resident in Switzerland — including entrepreneurs — must take out compulsory health insurance (LAMal) within 3 months of arrival or starting a business. Premiums are individual and proportional to age and canton of residence, not deducted from salary but paid directly to the insurer. Deductibles for adults range from CHF 300 to CHF 2,500 annually. The canton of Solothurn recognizes premium reductions (cantonal subsidies) for those with low incomes, calculated according to its own criteria.

Scenario: entrepreneur with a part-time employee Imagine a business with an owner and a part-time employee (50%). If the employee earns CHF 35,000 annually (coordinated), the employer pays approximately CHF 1,855 in AVS/AI/IPG, CHF 350 in SUVA (medium sector), CHF 385 in unemployment/occupational accident insurance, and a LPP share according to the employee's age (minimum 7%, maximum 18% of the coordinated salary). To these employment costs are added the cantonal and municipal taxes specific to the entrepreneur on income and capital, as well as personal LAMal premiums (variable according to age and chosen deductible). The total tax and insurance burden must be planned in the financial planning of startups: a common mistake is to underestimate these fixed costs.

VAT obligations at the federal level If the annual turnover exceeds the federal threshold for mandatory VAT registration (a variable threshold updated annually by the competent federal office), the entrepreneur must register with the competent federal office and pay the value-added tax according to federal rates. Below the threshold, registration is optional but may be convenient for those with foreign clients or investors who require VAT invoices.

Useful planning tools

To estimate your pension strategy, use the pension planner and the pillar 3 simulator.

Key points

The procedure to legally start a business in Solothurn follows these steps:

Step 1 — Choosing the legal form and preparing documentation

Decide between a sole proprietorship, LLC, or corporation. For corporate forms, draft the articles of association, gather identification documents (passport or ID card), obtain a criminal record certificate from the competent authorities, and appoint any managers or legal representatives.

Step 2 — Opening a dedicated bank account

At a Swiss bank, open a business account dedicated to the activity and deposit the minimum share capital required by the chosen legal form (specific amounts are determined at the federal level). The account must be in the name of the company or corporation, not the personal owner.

Step 3 — Registration in the commercial register

Submit the application to the competent cantonal office (Solothurn Canton Commercial Register), attaching the corporate documentation, the criminal record certificate, and proof of capital deposit. The process can be done online or in paper form according to cantonal procedures. Once approved, the company receives a registration number that legally identifies it.

Step 4 — Registration as an AVS employer

Simultaneously with the commercial registration, register with the competent AVS office (Solothurn Canton compensation fund) as an employer and a natural person subject to AVS. This obligation arises even if there are no employees yet, and is a prerequisite for hiring the first employee.

Step 5 — VAT declaration (if applicable)

If the annual turnover is expected to exceed the federal threshold, register with the competent federal office for VAT within the deadlines set by federal law. Registration enables billing with VAT and deducting the tax on business costs.

Step 6 — Mandatory insurance

Take out personal health insurance (LAMal) within 3 months of starting the activity, with a Swiss health insurance fund. Check the canton of residence and choose the preferred deductible (CHF 300–2,500 for adults) and coverage plan. Once employees are hired, register with a SUVA fund for occupational accident insurance.

Step 7 — Registration with a pension fund (LPP)

If the company has at least one employee, choose a pension fund (BVG/LPP) registered in the Solothurn Canton register. The employer must contribute to the coordinated salary of the employee (7–18% according to age), while the employee contributes their share (typically 5–10% according to the fund's regulations).

Critical deadlines

• Commercial register registration: Within the deadlines set by the cantonal office after submitting the application
• AVS registration: Simultaneous with commercial registration
• LAMal opening: Within 3 months of starting the activity
• Tax declaration: Within 60 days of the end of the fiscal year (usually by February/March)
• First pay slip: With correct AVS, SUVA, LPP payments according to gross amounts

A common mistake is to underestimate the administrative times and the complexity of initial compliance. Registration in the commercial register is not the end point, but the beginning: subsequent obligations (AVS, LAMal, LPP, VAT) logically follow and must be activated precisely. Consult the tax calculator to estimate the individual tax burden according to income and canton, and the pension portal to understand the specific LPP obligations for each age group of the employee.