Business
Switzerland — Business: Payroll
Swiss payroll includes contributions to the state old-age, survivors' and disability insurance (AHV/IV/EO) and, for employees above the income threshold, the mandatory occupational pension (BVG/LPP). Under the BSV, occupational pension insurance is mandatory for salaried people subject to AHV with an annual income of at least CHF 22,680 (the 2025 figure; stated again for 2026). The AHV 13th monthly pension is paid for the first time in December 2026; Parliament chose to part-finance it with a VAT increase of 0.4 percentage points that could take effect in early 2028 at the earliest, subject to a vote scheduled for November 2026. Contribution rates for AHV, unemployment and accident insurance are published by the AHV/IV information centre and insurers, so check them for the current year.
Why this matters
Swiss payroll is more layered than a single 'payroll tax' system — getting AHV, BVG pension banding, and Quellensteuer withholding all correctly calculated is complex enough that most small/medium employers outsource payroll to a fiduciary or use dedicated Swiss payroll software rather than running it manually.
Key facts
- The occupational pension (BVG/LPP) is mandatory for salaried people subject to AHV with an annual income of at least CHF 22,680 (2025 and 2026).
- The AHV 13th pension is paid for the first time in December 2026.
- Parliament chose a VAT increase of 0.4 percentage points to part-finance it, effective early 2028 at the earliest, subject to a vote scheduled for November 2026.
- Current AHV, unemployment and accident-insurance rates are published by the AHV/IV information centre and insurers.
Steps
- Register the company with AHV, UVG insurer, and a pension fund (BVG) — Mandatory before the first payroll run once employees are hired.
- Calculate gross-to-net per employee — Apply AHV/IV/EO, ALV, UVG, BVG, and Quellensteuer (if applicable) deductions correctly per cantonal tariff.
- Remit contributions monthly/quarterly — Pay employer and employee shares to the relevant AHV compensation office, insurer, and pension fund on schedule.
- Issue annual salary certificates — Provide each employee a Lohnausweis/certificat de salaire for their tax return by year-end/early following year.
Common mistakes
- Using old BVG thresholds — they are set by the BSV each year.