Insurance

In Switzerland, small employers can process the salary using a simplified procedure with the compensation office and the accident insurer. The settlement of social security contributions and withholding tax occurs at the beginning of the following year.

Young entrepreneurs should take care of retirement planning early, even if they are self-employed and not automatically insured. Options like the 2nd and 3rd pillar offer individual insurance possibilities, even without employees.

Self-employed individuals in Switzerland are subject to social insurance, depending on their place of work and residence as well as citizenship in Switzerland, EFTA, or the EU. Various cases regulate the insurance obligation and exceptions can be inquired about at the social insurance authorities.

As of January 1, 2016, the EO contribution rate will decrease from 0.5% to 0.45%, thereby employers/employees will pay a total of 10.25%. Self-employed individuals will now pay 9.65% towards AHV/IV/EO.

Employees in Switzerland are subject to the Swiss social security system, which depends on the place of work and nationality. Special cases such as secondments remain assigned to their home social security system.

Family allowances in Switzerland are regulated by the FamZG, which provides for minimum rates, although cantons can set their own higher amounts. Since 2013, self-employed individuals are also included, with employers or cantons taking over the financing for non-employed persons.

Social insurances such as AHV, IV, and EO are financed through contributions from employees and employers; self-employed individuals pay special rates. Other sources of funding include asset and per capita contributions, as well as public grants.

Contributions to the 3rd pillar in the Swiss pension system are voluntary and tax-free up to a certain amount. The maximum contribution depends on whether someone is a member of a pension fund or not.

Social security contributions (AHV/IV/EO/ALV) must be deducted from every salary; an exception applies to some low-income industries if the annual salary does not exceed CHF 2,300. Exceptions to this rule are possible if the employees work in certain artistic or domestic professions or explicitly waive the contributions.