The Episode In 60 Seconds
When it comes to finances, the mantra is “never procrastinate”. Here are the most important points to start off on the right foot:
VAT (Value added tax)
- VAT is a self-declaration tax, meaning you will not get a declaration form but have to submit it yourself on a quarterly basis.
- You have to pay VAT if your business generates more than 100k in revenue for the entire year.
- If you import software from abroad, you have to declare VAT as if you imported goods.
Payroll
Be aware of mandatory fees and deductions
- Mandatory fees: old-age pension (first pillar/ AHV), accident insurance (UVG), family allocation (EO), 2nd pillar (BVG) if you earn above 20k, unemployment insurance (ALV).
- Non-mandatory but recommendable: insurance for salary payments in case of sickness (Krankentaggeld-Versicherung). The insurance covers the employees salary after a certain time on sick leave (usually 60 days).
Invoicing
- Always invoice as fast as possible.
- 30 days payment period is customary but not mandatory.
- Try to inquire with the customer about the problem first before you consider debt collection in case of an outstanding payment.
- Pay your own bills at the end of the payment period.
Accounting costs and tools
- Try to do as much as possible by yourself and then get feedback from an accountant.
- Use a good software tool and choose a bank that integrates with it (for software tools you can check this list).
- A year-end review of your work by an accountant should cost something in the range of 1.5 to 4k.
- If you employ more than 10 people, you have to undergo an external audit which will cost you another 1.5 – 2k.
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