In June 2026, the Swiss Federal Supreme Court issued a ruling that matters to anyone considering — or already holding — a domicile address in a low-tax canton. The short version: the entry in the commercial register does not decide where your company pays tax. What matters is where it is actually run.
Many domicile-address providers won't tell you that. We will — because the ruling draws the exact line between a professional business address and an expensive illusion.
And because we sell business addresses ourselves, we'll say upfront what matters to us: we are not a letterbox company. This page is not a takedown of the entrepreneur involved — it is an explanation of what the ruling means, why real administration costs more than a bare address, and what we take from it for our own offering.
The case before the Federal Supreme Court
A Zurich-based entrepreneur founded a consulting LLC in 2014. He was sole owner, managing director and only employee. He registered the company's seat in Zug — paying CHF 1,200 a year for an address with weekly mail forwarding. He worked from his home in Zurich.
The Zurich tax office classified the Zug address as a pure letterbox domicile and retroactively assessed taxes back to 2016. The entrepreneur fought it — all the way to the Federal Supreme Court. And lost.
Federal Supreme Court (ruling 9C_652/2025 of 9 June 2026): the company showed "no indication of a physical presence" in Zug. The threads of management converged at the Zurich residence — so the LLC is fully taxable in Zurich.
The principle: place of effective management
The ruling does not invent anything new — it confirms long-standing practice with unusual clarity: a company is taxable where its material decisions are made and its day-to-day business is run. This is called the place of effective management.
- Where are contracts negotiated and signed?
- Where does management physically work?
- Where do meetings take place, and where is the infrastructure?
If the honest answer to these questions is "Zurich" — or "Berlin", or "wherever you actually sit" — a Zug commercial-register entry will not save you. The address is then, in the phrase that circulated after the ruling, not a tax optimisation but a time bomb with a domicile fee attached.
The most expensive part: why he paid twice
The truly painful part of the case: the entrepreneur had dutifully paid taxes in Zug for years — roughly CHF 144,000. When Zurich taxed him retroactively, that amount was not credited.
The Swiss Federal Constitution generally prohibits intercantonal double taxation. But: whoever misrepresents a seat to the tax authorities forfeits that protection. The money paid in Zug was gone — the Zurich bill still arrived.
What may have been structurally missing — our assessment
The facts on record in the ruling show what matters. We offer our professional read here — as an opinion on the structural lesson, not as a factual claim about the person involved, whom we do not know and are not judging:
- No physical presence: the court itself states there was "no indication of a physical presence" in Zug — no premises, no infrastructure, no visible activity on site.
- Pure mail forwarding instead of active administration: CHF 1,200 a year apparently bought an address with weekly mail forwarding — nothing more. No evidence of business activity on site.
- Operational management stayed at the residence: contracts, decisions, day-to-day business — according to the ruling, all in Zurich, none in Zug.
Important: this is our reading of the facts published in the ruling — not a legal assessment of the individual case, not a statement about fault, and not legal advice. We were not involved and are offering a professional opinion, not a factual allegation.
When a Zug address works — and when it doesn't
| Situation | Does it work? |
|---|---|
| You work in/around Zug and run the company from there | Yes — seat and effective management match |
| You want a professional address for mail and presence, your seat stays where it is | Yes — c/o address, no tax question |
| You are founding without Swiss residency and need a Swiss domicile | Legitimate — the tax situation belongs in individual advice |
| You work in Zurich/Berlin/abroad and want a Zug seat "for the tax rate" | No — this is exactly the case from the ruling |
c/o address vs. registered domicile: the distinction that counts
After this ruling, the distinction matters more than ever:
- c/o address (CHF 109/month): a professional Zug address for mail, invoices and presence. Your registered seat in the commercial register does not change — so nothing changes for tax purposes. The right choice for most companies.
- Registered domicile Premium (CHF 500/month): your official company seat in the commercial register. Only sensible if effective management actually matches — which is why we offer it exclusively after a qualification check.
Why real administration costs more than CHF 100
Some providers advertise addresses for CHF 29 or CHF 49. The difference to our price is not margin — it is substance. The price is not the point; what happens behind it is:
- Mail is received in person on business days, not collected over weeks
- Every letter is digitised and lands, structured, in your dashboard
- Deadlines in official mail are recognised, not missed
- A human is reachable when an authority asks — not an empty mailbox
A letterbox company in the literal sense is the opposite of this: an address with no structure behind it. It is not cheaper because it is more efficient — it is cheaper because it lacks substance. That missing substance was exactly the core of ruling 9C_652/2025. Real administration is therefore not a cost to shave off, but the part that makes an address hold up at all.
The Floow approach: we check before you sign
Most providers sell you the address you order. We check first whether it fits your situation:
- Qualification check before every registered domicile: where is your company actually managed? Why Zug? If it doesn't fit, we tell you — and recommend the c/o address instead.
- No tax promises: we sell addresses and mail management, not tax structures. Full stop.
- Transparency over fine print: this page exists because we believe an informed customer is a better customer.
Why we say no, too: a customer who ends up owing CHF 144,000 because of a mis-sold domicile address is not a customer for long — and has every right to be angry. Honest boundaries are not a marketing trick; they are the basis we work from.
Frequently asked questions
Is a domicile address in Switzerland illegal?
No. A domicile (c/o) address is entirely legal and recognised in the commercial register. It does not become illegal — it becomes a tax risk when the registered seat exists only on paper and the company is in fact run from somewhere else. In that case, the canton of effective management taxes you, not the canton on the letterhead.
What exactly did the Federal Supreme Court decide in June 2026?
In ruling 9C_652/2025 of 9 June 2026, the case concerned an LLC registered in Zug (a domicile address costing CHF 1,200/year) that was in fact run from the owner's home in Zurich. The court confirmed: the company is taxable where it is effectively managed — Zurich. The roughly CHF 144,000 already paid in Zug was not credited.
When does a Zug address work for tax purposes?
When your company is genuinely managed from Zug — meaning the material business decisions are actually made there. That can be the case if you work in or around Zug, use premises there, or your management sits on site. A pure mail address managed from another canton (or country) is not enough.
I just want a professional address for mail and presence — is that possible?
Yes — that is exactly what a c/o address without a seat relocation is for: a professional presence, mail reception and digitisation, while your registered seat stays where it already is. There is no tax question at all, because your tax domicile does not change. For most companies, this is the right path.
Does this also apply to founders based abroad?
The same logic applies internationally: if a Swiss company is in fact run from abroad, the tax law of that country can apply to it too. Founding without Swiss residency legitimately requires a Swiss domicile address — that part is fine. But your personal and corporate tax situation should be clarified individually with a tax professional in your country of residence. We flag this transparently rather than promising an outcome we cannot control.
Note: this article is journalistic context and a professional opinion — not tax or legal advice, and not a factual allegation about the conduct of the person involved in the ruling. For your individual situation, we recommend consulting a tax professional. Sources: Swiss Federal Supreme Court, ruling 9C_652/2025 of 9 June 2026; media coverage including Beobachter.
Looking for an address that fits your situation? See our Zug business address options — or talk to us directly. We'll tell you honestly what works for you.