Owning your short-term rental through a Swiss company or in your own name

Photo: Pexels

Every owner who buys a flat on the Riviera to let short-term asks the same question a few weeks later, usually after the first insurance quote arrives: should this property sit in my own name, or inside a Swiss company? It is framed as a legal question, and it is really an arithmetic one — entry cost, holding cost, exit cost and financing, each of which behaves differently depending on the vehicle.

This guide sets out what the two vehicles actually cost in Switzerland and in the canton of Vaud, with the official figures, and where the differences that decide the answer sit. It is general information, not tax or legal advice: for a specific purchase or a specific building, the people to consult are a Swiss fiduciary and a lawyer.

What a Swiss company actually gets you

Take the two vehicles an owner realistically considers. The SA (société anonyme) requires a share capital of CHF 100’000, of which at least 20% must be paid in, with a floor of CHF 50’000; the Sàrl (société à responsabilité limitée) requires CHF 20’000, fully paid in. Both carry no personal liability of the shareholders once the capital is fully paid up, both must keep accounts, and both are in principle subject to an audit organ — with an exception where the company has no more than ten employees and the shareholders all agree.^[1] Those are the numbers you are buying into, and they explain the shape of the decision: the Sàrl is the cheap vehicle, the SA the one a bank, a co-investor or a foreign buyer usually finds easier to live with.

The liability argument is the one most often oversold. Yes, the shareholder’s personal assets are out of the picture as a matter of company law.^[1] In practice, a lender financing a single flat through a company will normally ask for a personal guarantee or a joint and several undertaking from the shareholder before it prices the loan — so the shield exists on paper and is negotiated away in the mortgage file. If the reason you are incorporating is to stop being personally exposed to the property, ask the lender before you ask the notary.

The tax layer you add on the day you incorporate

A company is a taxpayer in its own right. In Vaud the cantonal base rate on the profit of capital companies has been 3⅓% of net profit since 2019 (3.75% on the part above CHF 10 million from 1 January 2025), and that base must still be multiplied by the cantonal coefficient — 155% in 2025 — and by the commune’s own coefficient, which varies with the seat. On top of that, direct federal tax on the profit is 8.5% of net profit.^[2] Add the two sourced components and you are at roughly 14% before the commune coefficient is applied; with a typical communal coefficient the combined load lands in the mid teens.

Then the money has to reach you. The legal-form comparison published by the Swiss authorities is blunt about it: for both the SA and the Sàrl the taxation column reads “company and owners on distributed amounts”.^[1] Profit retained in the company is taxed at corporate rates; profit distributed as a dividend is taxed again in your personal return. In personal ownership there is one layer, and there is no distribution event at all.

One declaration rule applies to the rental income whoever owns the flat. In Vaud, furnished homes — which is what a short-term let is — are declared on a flat basis: rents from furnished dwellings or from dwellings let through an accommodation platform are ordinarily reported at 80% of the amount collected, to account for wear on the furniture and the higher maintenance costs of such flats.^[6] That is a deduction of 20% before you even turn to mortgage interest and upkeep, and it runs the same way in both structures.

The two property taxes, and who pays them

Here the two vehicles genuinely diverge, and the divergence is annual. Vaud levies an impôt foncier on all owners of immovable property — individuals or companies — capped at 1.5‰ of the fiscal estimate of the property; and an impôt complémentaire sur les immeubles on all legal persons owning one or more properties, at 1‰ of the fiscal estimate.^[3] In other words, holding a flat through a company costs you a permanent 1‰ that a natural person simply does not pay, on top of the ordinary property tax. At the same time, the entry cost is identical: the transfer duty on the purchase of a property is due once, from the buyer, at 3.3% of the sale price, cantonal and communal together.^[4]

The exit decides it — and Vaud has closed the obvious door

For a private owner, the gain on a property sale is taxed separately from income, on a scale that falls with the years of possession: 30% for a holding of up to one year, 27% between one and two years, and down through the scale to 7% from 24 years. Years of occupation that you can prove count double, the tax is owed by the seller, and the state pays five twelfths of it to the commune where the property sits.^[5] A flat held and occupied for a decade can therefore be treated as a holding of two decades on the scale. This scale is one of the most valuable assets a long-term owner has, and it is available only in personal ownership: gains that are not subject to the property-gains tax fall into taxable income or profit instead.^[5]

Sale through the company is not the escape route it is often described as. Vaud’s tax law assimilates to the alienation of a building “the transfer of shares or parts of property companies”, and — wider still — “any act that has the effect of transferring to a third party the real and economic power of disposal over all or part of the building”, with property companies defined as legal persons whose main activity is the construction, exploitation, purchase or sale of properties.^[5] Selling the SA or Sàrl rather than the flat does not take the building out of the tax net in this canton; it puts the transaction inside it. There is a small exemption for trivial cases — no property-gains tax where total gains in a fiscal year come to less than CHF 5’000^[5] — and that is not a structure, it is a rounding threshold.

Read together, the two sides of the exit give the practical rule. A resale inside a few years is taxed at 30%, 27% or 24% for an individual, against a corporate rate in the mid teens on the same gain: short horizons favour the company. A hold measured in decades ends at 7% — with proven occupation years counting double — against the same corporate rate, and there the company is the expensive structure. The vehicle is chosen by the holding period you actually intend, not by the one the brochure assumes. The mechanics of that personal scale — how the years are counted, when taxation is deferred, and what the commune receives — are set out in our guide to Vaud capital gains tax on a property sale.

If a foreign buyer is involved, the structure is checked first

The federal law on the acquisition of property by persons abroad (LFAIE, the “lex Koller”) restricts acquisition by foreign nationals, by companies seated abroad, and by companies seated in Switzerland in which foreign nationals hold a dominant position. Those persons and companies must apply for authorisation from the competent cantonal authority first, authorisation can only be granted in the cases the LFAIE or cantonal legislation provides for, and each file is examined case by case.^[7] The lesson for structure planning is direct: taking shares in a Swiss property company is one of the configurations the law targets, not a way around it — and the Federal Council sent a draft revision to consultation on 15 April 2026 proposing, among other things, to subject the purchase of homes by nationals of states that are members neither of the EU nor of EFTA to authorisation and to restrict the acquisition of holiday homes, with consultation open until 15 July 2026.^[7] Anyone buying through a company now should assume the rules will tighten around that structure rather than relax.

When the company is the right answer

Pulling the sourced pieces together, the company is normally the better structure when at least one of these is true:

• Several owners, one building. Partners can hold shares in proportion to their contribution without ever re-entering the land register, and a departing partner can be bought out by the others without a sale of the property itself.
• The buyer cannot hold Swiss property personally. Where the LFAIE applies, the vehicle and the authorisation file are part of the same decision.^[7]
• The horizon is short. A renovation-and-resale or a repositioning inside a few years meets a personal scale that starts at 30%, against a corporate rate in the mid teens — accepting that Vaud taxes the share transfer as well.^[5]
• Profits are meant to stay inside the structure. Cash retained for the next purchase, or for a renovation programme, is taxed at the corporate rate and not again until distributed.^[1][2]

And it is usually the wrong answer when none of them is true: one flat, one owner, a plan to hold for fifteen years and pass the property on. There the owner is buying an administrative apparatus, an annual 1‰ surcharge that no individual pays,^[3] and a second tax on every franc taken out of the company — while giving up the personal scale that ends at 7% with the years of occupation counted double.^[5] Whatever the answer, two things do not change with the vehicle: the furnished rental is declared at 80% of what it collects,^[6] and if the flat sits in a condominium the building’s own regulation decides whether the activity is allowed at all — our guide to short-term letting in a PPE covers that side, and tax and VAT on Montreux short-term rentals covers the declarations that follow.

Frequently asked questions

If the structure question is settled, the next two files to open are the one on tax and VAT on short-term rentals in Montreux and the owner guides hub, where the market, legal and tax material sits together. And if the flat is in a condominium, check what the building’s regulation allows before anything else: short-term letting in a PPE.

Sources

1. easygov.swiss (Swiss Confederation), “Les différentes formes juridiques” (legal-form comparison, version 01.01.2023) — minimum capital, liability of shareholders, obligation to keep accounts, audit organ, and the “société + propriétaires sur montants distribués” taxation column for the SA and the Sàrl.
2. Etat de Vaud, “Impôt sur le bénéfice” (corporate profit tax) — cantonal base rate of 3⅓% of net profit since the 2019 tax period (3.75% above CHF 10 million from 1 January 2025), multiplied by the cantonal coefficient (155% in 2025) and the communal coefficient, plus direct federal tax of 8.5% of net profit.
3. Etat de Vaud, “Impôt foncier / complémentaire immeubles” — impôt foncier of 1.5‰ of the fiscal estimate at most on all owners of property, and impôt complémentaire of 1‰ of the fiscal estimate on all legal persons owning one or more properties.
4. Etat de Vaud, “Droit de mutation (achat)” — transfer duty of 3.3% of the sale price, cantonal and communal, due once from the buyer, as against the annual impôt foncier of 1.5‰.
5. Administration cantonale des impôts du canton de Vaud, form 21020, Déclaration d’impôt sur les gains immobiliers — extracts of the cantonal law on direct taxes (LI), art. 61 to 64 (notably the assimilation of the transfer of shares or parts of property companies, and the definition of property companies), art. 72 (scale relating the rate to the years of possession, 30% up to one year down to 7% from 24 years; years of proven occupation count double) and art. 74 (five twelfths to the commune).
6. Administration cantonale des impôts du canton de Vaud, instructions 21004 (2023) — rents from furnished dwellings and dwellings let through an accommodation platform are ordinarily reported at 80% of the amount collected.
7. Office fédéral de la justice, “Acquisition d’immeubles par des personnes à l’étranger” (LFAIE / lex Koller), page of 12 February 2026 — authorisation requirement for foreign nationals and for Swiss-seated companies with a dominant foreign participation, case-by-case examination by the canton, and the consultation of 15 April 2026 on tightening the law. Consulted 15 October 2026. General information, not tax or legal advice — for a specific purchase or building, consult a Swiss fiduciary and a lawyer.