Swiss Bookkeeping Basics

Learn the fundamentals of Swiss bookkeeping: CO obligations, chart of accounts, and documentation principle.

Swiss Bookkeeping Basics

Swiss bookkeeping is governed by clear legal requirements set out in the Swiss Code of Obligations (CO, Obligationenrecht) and the Commercial Bookkeeping Ordinance (GeBüV). Whether you are a freelancer or running a limited company, understanding these rules is essential. This guide covers the fundamentals you need to know.

Who Is Required to Keep Books?

Under CO Art. 957, the following entities are required to maintain proper accounting records:

  • Sole proprietorships and partnerships with annual revenue of CHF 500,000 or more
  • Legal entities (GmbH/LLC, AG/Corp, cooperatives, associations, foundations) -- regardless of revenue

Simplified Bookkeeping (Milchbuechli)

Sole proprietorships and partnerships with annual revenue below CHF 500,000 may use simplified bookkeeping. This method, informally known as a "Milchbuechli" (milk booklet), only requires tracking:

  • Income and expenses
  • Assets and liabilities (financial position)

This is perfectly sufficient for many freelancers and small businesses. Once the revenue threshold is exceeded, the business must switch to full double-entry bookkeeping.

Simple vs. Double-Entry Bookkeeping

Feature Simple Bookkeeping Double-Entry Bookkeeping
Suited for Sole proprietors < CHF 500K GmbH, AG, larger businesses
Core principle Income/expense tracking Every transaction is recorded in two accounts (debit/credit)
Required documents Income/expense journal, asset overview Balance sheet, income statement, notes
Legal basis CO Art. 957 para. 2 CO Art. 957 para. 1, Art. 957a, Art. 958

The Swiss SME Chart of Accounts

For double-entry bookkeeping, most Swiss SMEs use the Swiss SME Chart of Accounts (Kontenrahmen KMU). It organizes accounts into these main classes:

  • 1 -- Assets (current assets, fixed assets)
  • 2 -- Liabilities (debt, equity)
  • 3 -- Operating revenue (sales)
  • 4 -- Cost of materials/goods
  • 5 -- Personnel expenses
  • 6 -- Other operating expenses
  • 7 -- Non-operating income/expenses
  • 8 -- Extraordinary items
  • 9 -- Closing accounts

Each account has a unique number (e.g. 1000 = Cash, 1020 = Bank, 1100 = Accounts receivable).

The Documentation Principle

A core principle of Swiss bookkeeping is: No entry without a receipt. Every transaction must be supported by a voucher -- whether it is an invoice, a receipt, or a bank statement.

Under the GeBüV, all accounting records and supporting documents must be retained for 10 years. Electronic storage is permitted as long as the data remains readable and can be reproduced unchanged at any time.

Requirements for Bookkeeping Records (CO Art. 957a)

  • Complete -- all transactions recorded
  • Truthful -- reflecting the actual financial situation
  • Clear -- organized and understandable
  • Appropriate -- suited to the size of the business
  • Verifiable -- traceable by third parties (documentation principle)

Mandatory Year-End Documents

For entities required to keep full accounts, CO Art. 958 mandates the following financial statements:

  • Balance sheet -- assets, liabilities, and equity as of the reporting date
  • Income statement -- revenue and expenses for the fiscal year
  • Notes -- supplementary disclosures (e.g. valuation methods, contingent liabilities)

Larger companies (CO Art. 961) must additionally prepare a cash flow statement and a management report.

How LumaBill Helps

LumaBill supports you in meeting Swiss bookkeeping requirements:

  • Choose your bookkeeping mode -- simple income/expense tracking or full double-entry, based on your legal obligation
  • Pre-configured Swiss SME chart of accounts -- ready to use and fully customizable
  • Automatic journal entries -- invoices and expenses are booked automatically
  • Document management -- capture receipts digitally and link them to transactions
  • 10-year-compliant archiving -- all data remains accessible long-term
  • Balance sheet and income statement -- generated at the click of a button

Further Reading

Understanding VAT