Going self-employed: the steps, in order

Step 1, A name, and a legal form

Nadia starts alone, with no partner and no capital to tie up: the sole proprietorship is the obvious choice. One rule she did not know: the business name must contain her family name. “Nadia Rochat, peinture” works; “Couleurs & Co” on its own does not.

Had she started with a partner, or with premises and equipment to finance, the question would have been different, that is the subject of another page.

Step 2, The commercial register, or not

A surprise for Nadia: as a sole proprietor, registration is optional as long as turnover stays under CHF 100,000 a year. It becomes mandatory above that, or if the activity is run in a commercial manner.

Optional does not mean useless. An entry gives a public existence anyone can check on Zefix, reassures a contractor vetting subcontractors, and, as the next step shows, counts among the signs that one is genuinely self-employed. Nadia registers from day one. No notary needed: for a sole proprietorship everything is done online.

Step 3, The compensation office decides whether you are self-employed

This is the step Nadia had not seen coming. Being self-employed is not declared: it is recognised by the AVS compensation office, which looks at facts, not intentions.

• She trades under a business name, register entry, letterhead, invoices in her name.
• She bears the economic risk, investments, equipment at her expense, the risk of unpaid invoices, rent for premises.
• She organises her work freely, hours, choice of jobs, the option to subcontract.
• She works for several clients. With a single client, the office will more likely see a disguised employee, with the contributions charged to that client.

Once recognised as self-employed, Nadia pays 10.0% of her income to AVS, AI and APG (8.1 + 1.4 + 0.5), the whole of it, with no employer to take half. But not at the full rate straight away.

The sliding scale, the first piece of good news

In her first year Nadia earns CHF 38,000. The full rate only applies from CHF 60,500 of annual income; below that, a sliding scale takes over. At CHF 38,000 she contributes 6.728%, not 10%.

Below CHF 10,100 of income, a minimum contribution of CHF 530 is due regardless: even a blank year counts towards the pension.

Step 4, What Nadia no longer has

As an employee, three protections came to her without a thought. Self-employed, none follows.

• Unemployment. A self-employed person neither contributes to it nor is entitled to it.
• Accidents. No mandatory accident insurance covers her, a fall from scaffolding is at her expense, unless she takes out insurance herself.
• The 2nd pillar. She is no longer subject to mandatory LPP. Nothing builds up for her retirement beyond AVS, except what she decides.

This is where most self-employed people lose the most, silently, for years. An uncovered accident or ten years without a 2nd pillar cannot be caught up. These choices deserve an hour before the first job, not after the first claim.

Step 5, The first employee changes everything

Second year: too many jobs, Nadia hires Karim. She becomes an employer, and three obligations arise the day the contract is signed.

• AVS affiliation as an employer with the compensation office: from now on she withholds Karim's share from his salary and pays her own.
• Accident insurance, mandatory for every employee, the exact opposite of her own situation.
• The 2nd pillar, as soon as Karim's annual salary reaches CHF 22,680 , the 2026 LPP entry threshold. Below it, no mandatory affiliation; above it, she must choose a pension fund before the first salary.

The Bern scale, when Karim falls ill

Third year, Karim breaks his wrist outside work. A sick employee is entitled to his salary for a limited time that depends on seniority. The Code of Obligations speaks of a “reasonable period”; the courts have translated it into a grid, known as the Bern scale, applied by most French-speaking cantons.

Karim is in his second year of service: Nadia owes him a full month's salary while he is not working. This is where most small employers take out daily sickness allowance insurance, which takes over, the law allows it, provided the cover is at least equivalent.

The scale counts by year of service, from the anniversary of the hiring date, and absences within the same year add up. A collective agreement may provide more; never less.

The thread, in one sentence

Choose a form, register or not, get recognised by the AVS office, cover what you lose by leaving employment, and, the day you hire, find on the other side of the desk the obligations you had stopped seeing. It took Nadia six months to piece this order together. It fits on one page.