Payroll in Switzerland

Payroll in Switzerland

Updated on Monday 21st September 2015

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Payroll-in-SwitzerlandPayroll administration in Switzerland

Payroll administration in Switzerland is a quite complex process and is usually conducted by the senior management in a company. However, the current tendencies show that more and more Swiss companies require the services of specialists to handle HR and payroll administration. Payroll management in Switzerland implies the following activities:

  • - managing the employees database,
  • - calculating salaries,
  • - preparing pay slips,
  • - booking payments.

Our lawyers in Switzerland may also help you by providing you all the information related to the tax legislation at cantonal and federal levels.

What are the taxes covered by payroll in Switzerland?

When preparing the payroll for its Swiss employees, a company must take into account all the taxes to be paid. Swiss companies are required to withhold the following taxes and insurances:

  • - the social security contribution (AHV),
  • - the unemployment insurance (ALV),
  • - the accident insurance,
  • - the social security administration,
  • - the pension contributions (BVG),

The Swiss Employment Law also requires employers to grant a 20-day holiday per year to their employees. The holiday pay must also be calculated on a daily rate of 8.33% of the global salary and must appear on the salary statement.

With respect to the tax rates paid for the social security and other contributions, these are:

  • - 5.15% for the AHV on behalf of the employer,
  • - 1.1% for the unemployment insurance,
  • - 0.652% for the accident insurance.

The Swiss legislation also establishes payment rules on an hourly, daily, weekly, monthly and annual basis.

Payroll services in Switzerland

Our law firm in Switzerland provides the following payroll and HR administration services:

  • - monthly payroll management,
  • - salary administration,
  • - payroll management for expatriates employees,
  • - concluding social insurance contracts,
  • - tax registration with the authorities.

With respect to foreign employees, the legislation provides more complex regulations which depend on the type of Swiss work permit granted to the employee. These regulations depend on the canton the employee is registered in. For detailed information about the taxation system applicable in each canton, please contact our Swiss attorneys.