News - Switzerland

Switzerland - March 2014

Social Security Contribution Rates for 2014 announced

Social security contribution rates are generally adjusted every other year in line with the economic situation and salary trends. The latest amendments entered into force on January 1st, 2014.

Social insurance contribution rates 2014

 

Social insurance sector

 

Contributions as percentage of earned income

 

Contributions by insured not in gainful employment

Contributions in favour of the employee

Contributions by the self-employed

in CHF per year

Employee

Employer

Total

Minimum

Maximum

OASI (AHV)

4.20%

4.20%

8.40%

4.200% - 7.800%1

392

19,600

DI (IV)

0.70%

0.70%

1.40%

0.754% - 1.400%1

65

3,250

EO (EO)

0.25%

0.25%

0.50%

0.269% - 0.500%1

23

1,150

UI (ALV)2

1.10%

1.10%

2.20%

-

-

-

OA (BUV)2

-

0.82%

0.82%

3

-

-

NOA (NBUV)2,4

1.46%

-

1.46%

3

-

-

PP (BV)5

7.71%

10.16%

17.83%

3

-

-

FA (FZ)6

-7

between
0.1% and 4.0%6

between
0.1% and 4.0%
6

0.8% and 2.8%6

-

-

 

  1. The contribution rate depends on the level of earned income. The first rate applies to an income level up to and including CHF 9,400, the second one for an income of at least CHF 56,200 (a "degressive contribution scale" is applied to intermediate income levels).
  2. Max. insured income: CHF 126,000 per annum. UI: An UI contribution of 1.0% is applied to salary income over CHF 126,000. OAI; NOAI: average gross premium rate (2011). Premiums calculated according to the risk. Separate rules apply to part-time workers.
  3. The self-employed may also contribute to this voluntary insurance scheme.
  4. Individuals who are employed for less than 8 hours per week are not insured against non-occupational accidents. For the unemployed, the contribution rate is 2.63%.
  5. Estimated (pension fund statistics, 2011) in % of the insured salary (max. CHF 835,200). Contributions are set by the insurance funds.
  6. Regulations vary across cantons.
  7. Valais is the only canton where it is compulsory for employees to pay 0.3% (since January 1st, 2002).

Mandatory Social Security Contributions

Employers are obliged to pay the following mandatory social security contributions:

Old-age and survivors', disability and loss of income fund and maternity insurance (OASI, DI and EO)

The basis for calculating the 10.3% is the so-called “AHV-decisive remuneration”, which comprises the salary and any additional remuneration derived from employment.

Unemployment insurance (UI)

Additionally, the employer is obliged to pay for each employee the mandatory contribution to the unemployment insurance (ALV) of 2.2% of the “AHV-decisive remuneration” up to a salary income of CHF 126’000 per annum. In addition, income over CHF 126’000 is subject to a solidarity contribution of 1.0%.

Mandatory accident insurance (OA and NOA)

The employer is solely liable for the insurance premiums covering occupational accidents and illnesses and cannot recover these amounts from employees.. The premiums covering non-occupational accidents are paid by the employee. The maximum insured income is CHF 126’000 per annum.

Family allowances (FA)

The employer is obliged to pay family allowances (FZ) between 0.1% and 4.0% of the “AHV-decisive remuneration” of each employee.. Again, the employer cannot recover these amounts from employees .

Occupational benefit plan (PP)

Both the employer and the employee contribute to the occupational benefit plan (pension scheme). The employer’s contribution must at least equal the contribution paid by the employee.. All employees with an annual salary in excess of CHF 21'060 must be insured under the occupational benefit plan. The amount of annual salary between CHF 24’570 (the so-called coordination deduction) and CHF 84’240 must be insured. This part of the salary is referred to as the “coordinated salary”. The minimum coordinated salary is CHF 3’510. The employer must be affiliated to an approved pensions provider. Each provider sets its own contribution rates for employees and employers.

Commentary

The employer is obliged to register newly hired employees with the cantonal Compensation Office within one month of their start date.. Where it is unclear whether a contractual relationship is based on self-employment or employment, the employer is advised to contact the local Compensation Office for clarification.

Resources

Federal Social Insurance Office ("Bundesamt für Sozialversicherungen"):

Old-Age and Survivors' Insurance and Disability Insurance ("Alters- und Hinterlassenenversicherung AHV und Invalidenversicherung IV" )

For further information or to discuss any of the issues raised, please contact Stefanie Monge or Nadja Flühler on +41 44 220 12 12 at Poledna Boss Kurer AGwww.pbklaw.ch.

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