Despite the increasing use of non-hydrostatic models in the study of wave processes in coastal regions, there is still limited understanding of the non-linear properties of the governing equations and how they improve with increased vertical resolution. In this study, the governing equations of the non-hydrostatic wave model SWASH are analysed and the linear and non-linear solutions up to third-order of all dependent variables are derived, considering one to four vertical layers. The analysis concludes that the model can achieve excellent non-linear properties with respect to the Stokes theory over a large range of water depths using only a few vertical layers. Furthermore, deriving solutions for all variables enables the formulation of improved wave generation and absorption boundary conditions for non-hydrostatic models. A well-known issue of non-linear wave models is related to the generation and propagation of spurious free waves, resulting to non-homogeneous wave fields. In this study, it is proven that by imposing the derived exact mathematical solutions of the governing equations at the model's boundaries, the target first- and second-order wave profiles can be generated with high accuracy, while the spurious waves can be entirely eliminated.