Swiss Paycheck: All You Need to Know

Gross Salary

The gross salary is the total amount of your compensation before any deductions. In Switzerland, salaries are often quoted annually and may be divided into 12 or 13 monthly payments. The 13th payment, if applicable, is a bonus. Some employers also offer additional benefits, such as transport allowances, meal vouchers, or housing.

Social Deductions

Social deductions in Switzerland are categorized as follows:

OASI/IV/EO (First Pillar)

• OASI (Old Age and Survivors’ Insurance): Provides pensions in retirement or in the event of a family member’s death.
• IV (Disability Insurance): Offers pensions or reintegration measures for individuals with disabilities.
• EO (Loss of Earnings Insurance): Covers absences for military service or maternity leave.

Unemployment Insurance (UI)

The unemployment insurance covers income loss in case of unemployment. The rate is 2.2% for salaries up to CHF 148,200 and 1% for the portion exceeding this amount.

OP (Second Pillar)

The occupational pension plan (OP) supplements the OASI to ensure approximately 60% of your final salary upon retirement. Contribution rates vary by age:

• 25-34 years: 7%
• 35-44 years: 10%
• 45-54 years: 15%
• 55-65 years: 18%

Accident Insurance (AI)

• Occupational Accident Insurance (OAI): Fully covered by the employer.
• Non-Occupational Accident Insurance (NOAI): Mandatory for employees working more than 8 hours a week. The rate depends on the industry and company.

Withholding Tax

Withholding tax is deducted directly from your salary and is calculated based on your income, residency status, and the canton where you work. Cross-border workers may be taxed in Switzerland or in their country of residence, depending on bilateral agreements.

Family Allowances

Family allowances are paid for each child:

• CHF 200 per month for children under 16 years old.
• CHF 250 per month for children aged 16 to 25 years in education.

Net Salary

The net salary is the amount you receive in your bank account after all deductions. It may also include bonuses or other adjustments.

To quickly estimate your net salary, use the simulator on lohncomputer.ch.

Optimize Your Salary Transfer

Now that you have all the keys to understand your Swiss paycheck, if you’re a cross-border worker and need to transfer your salary, use ibani to avoid unnecessary banking fees.