People often mix up a virtual office (or a virtual business address) and a letterbox company. In our article, we define both terms and explain the differences. One thing in advance: It is about much more than just an address.


The most important facts, in short:

• Whereas a virtual office offers a legal solution with real services, a letterbox company often serves tax avoidance and secrecy.
• A virtual office in Switzerland offers a prestigious address economic stability and excellent networking opportunities.
• A virtual office is legally safe and supports business growth. Letterbox companies operate in a legal grey area.

What is a Virtual Office

A virtual office offers a business address without the need for a physical office. It is ideal for start-ups, small businesses and freelancers. In addition to the business address, you often also receive administrative services – for example, mail forwarding, telephone reception or access to meeting rooms. With a business address in Switzerland, you remain flexible and mobile – while your business has a fixed address at a representative address.

What is a letterbox company?

The letterbox company is distinct from the virtual office. This is a company that exists legally, but has no actual business activities or operating facilities. It can serve diverse purposes: the management of assets, tax avoidance, concealment of the company location and the owners or the concealment of transactions. It is sometimes used for money laundering or even terrorist financing.

Also important:

• A letterbox company is often registered in tax havens. It does not assist in the operation of a business, but rather in financial and legal strategies.
• A common feature is the use of sham directors – sometimes even the names of employees such as cleaners. These practices can be illegal in certain cases – especially if assets are hidden from the domestic treasury.
• However, a letterbox company is not illegal per se. The tax laws that apply in the country of the letterbox are often used. However, a letterbox company is often associated with negative headlines, poor image and ethical concerns.

Comparison: Virtual Office and letterbox company

• A virtual office is a legal and transparent solution. It’s about using business services without owning a physical office. It offers real added value through services that offer a competitive advantage (for example, image gain at a representative address) and support business growth.
• A letterbox company is often used for less transparent purposes. While a business address or a virtual office supports real business activities, letterbox companies are usually used for financial loopholes or to conceal ownership.
• A virtual office has a better image. It stands for flexibility and efficiency. Letterbox companies, on the other hand, are often associated with tax evasion and secrecy.
• Virtual offices are aimed at companies that need flexibility and a professional image. These include start-ups, small and medium-sized businesses and freelancers. Letterbox companies, on the other hand, are often used by larger companies or wealthy individuals who pursue certain financial or legal goals.

Legal and ethical considerations

There are no legal concerns when using a virtual office. It is a legitimate solution for using business services. The situation is different with letterbox companies: here you are often in a legal grey area. They can be legal – but are controversial, especially with regard to tax avoidance and transparency.

Closing remarks

A virtual office or a letterbox company – two concepts, with a big difference. A virtual office supports your business with real services and flexibility. A letterbox company often serves more complex, less transparent purposes. Choose wisely – after all, it’s about the image and legality of your company.

Tip: business addresses in Switzerland

A virtual office in Switzerland can be particularly useful. You not only get a prestigious address – but also global recognition and local advantages. Companies benefit from Switzerland’s economic stability, innovative environment and strict data protection laws. Please contact us if you are looking at using a business address in Switzerland.