Switzerland Payroll Information – Deel Global Payroll

Updated on: 2025/08/04 14:35 (UTC)

Overview

Switzerland, which officially is known as the Swiss Confederation, is a federal republic consisting of 26 cantons located in central Europe. The countries that border Switzerland are France to the west, Germany to the north, Austria and Liechtenstein to the east, and Italy to the south. The official languages of Switzerland are French, German, Italian, and Romansh. The country of Switzerland’s name is rendered in French as Suisse, in German as Schweiz, in Italian as Svizzera, and in Romansh as Svizra. The two-letter country code of Switzerland is CH, which is an abbreviation of Confoederatio Helvetica, the Latin term for Swiss Confederation.

The 26 cantons of Switzerland are Aargau (Argovia, Argovie), Appenzell Ausserrhoden (Appenzell Outer-Rhodes, Appenzell A.Rh., Appenzello Esterno, Appenzell Rhodes-Extérieures, Appenzell Dadora), Appenzell Innerrhoden (Appenzell Inner-Rhodes, Appenzell I.Rh., Appenzello Interno, Appenzell Rhodes-Intérieures, Appenzell Dadens), Basel-Landschaft (Basel-Land, Basel-Country, Basilea Campagna, Basilea-Champagna, Bâle-Campagne), Basel-Stadt (Basel-City, Basilea Città, Basilea-Citad, Bâle-Ville), Bern (Berne, Berna), Fribourg (Friburg, Freiburg, Friburgo), Geneva (Genève, Ginevra, Genevra, Genf), Glarus (Glaris, Glarona, Glaruna), Graubünden (Grisons, Grigioni, Grischun), Jura (Giura), Luzern (Lucerne, Lucerna), Neuchâtel (Neuenburg), Nidwalden (Nidwald, Nidwaldo, Sutsilvania), Obwalden (Obwald, Obwaldo, Sursilvania), Schaffhausen (Schaffhouse, Sciaffusa, Schaffusa), Schwyz (Schwytz, Svitto, Sviz), Solothurn (Soleure, Soletta, Soloturn), St. Gallen (Sankt Gallen, Saint-Gall, St-Gall, San Gallo, Son Gagl), Thurgau (Thurgovia, Thurgovie, Turgovia), Ticino (Tessin), Uri, Valais (Vallais, Wallis, Vallese), Vaud (Vad, Waadt), Zug (Zugo, Zoug), and Zürich (Zurich, Zurigo, Turitg).

Switzerland’s currency is the Swiss franc.

Employers in Switzerland are responsible for withholding income taxes from some employees, withholding social taxes, and making payments for all employees. Taxes also are assessed at the federal, cantonal, and communal level.

Compensation and benefits provisions are mandated by the Federal Code of Obligations and the Federal Labor Act, in addition to other legislation. All employers are required to provide funds for pensions.

Foreign workers in Switzerland have several different types of visas and residence permits which foreign workers may obtain in order to work legally in Switzerland. Additionally, Switzerland is a member of the European Free Trade Association and has tax treaties with more than 90 countries.

Swiss residents working in the United States are covered by U.S. tax law with possible treaty and work status exclusions applying. Work within the U.S. states and territories is covered by various labor laws.

CURRENCY DETAILS

The currency of Switzerland is the Swiss franc (CHF), which also is written in English as Swiss Franc and is known in French as Franc suisse, in German as Schweizer Franken, in Italian as Franco svizzero, and in Romansh as Franc svizzer. The internationally recognized three-letter currency code for the Swiss franc is CHF, which is derived from Switzerland’s internationally recognized two-letter country code of CH and F as an abbreviation of franc, and which also is one of the currency symbols for the Swiss franc. The English plural form of Swiss franc is Swiss francs, the French plural form of Franc suisse is Francs suisses, the German plural form of Schweizer Franken is the same as its singular form, the Italian plural form of Franco svizzero is Franchi svizzeri, and the Romansh plural form of Franc svizzer is Francs svizzers.

When an amount of Swiss francs is written in English or Romansh using the currency symbol CHF, the currency symbol precedes the numerical value with a space between the numerical value and symbol, and when an amount of Swiss francs is written in French, German, or Italian, the currency symbol CHF either precedes or follows the numerical value with a space between the numerical value and symbol. When an amount of Swiss francs is written using the currency symbol SwF, the currency symbol precedes the numerical value with a space between the numerical value and symbol. The currency symbol FS sometimes is used in French for the Swiss franc, is an abbreviation of Franc suisse, and has the same placement treatment as the currency symbol SwF.

When an amount of Swiss francs is written using the currency symbol SFr. or one of its variants (SFr, SFR., SFR, Sfr., Sfr, sFr., sFr, sfr., and sfr) to distinguish Swiss francs from other franc currencies, and when Swiss documents use the general franc currency symbol Fr. or one of its variants (Fr, fr., fr, FR., FR, Frs., Frs, F., F, f., and f) to refer to Swiss francs, the currency symbol either precedes or follows the numerical value with a space between the numerical value and symbol.

One hundredth ( ¹ ⁄ ₁₀₀ ) of a Swiss franc is referred to in English and German as a rappen, which has the same plural form as its singular form; the subdivision is referred to in French as a centime with the plural form of centimes; the subdivision is referred to in Italian as a centesimo with the plural form of centesimi; and the subdivision is referred to in Romansh as a rap with the plural form of raps.

When amounts of Swiss francs are written in Swiss dialects of French, German, and Italian, and when amounts of Swiss francs are written in Romansh, the comma that in English separates the thousands place from the hundreds place instead usually is rendered as an apostrophe, but sometimes a dot (.) or space is used, although some government entities prefer to merely have the numbers in the thousands place and hundreds place adjacent to each other with no symbol or space between them.

TAXES

Taxes in Switzerland are levied on the federal, cantonal, and communal level. Taxes include income taxes and social taxes . Employers are required to withhold income taxes of noncitizens without a type C residence permit, and are required to make social tax withholdings and payments for all employees.

Employers also must follow income tax requirements in Switzerland’s cantons as well.

The tax year is the calendar year from Jan. 1 to Dec. 31.

The following table provides links to each canton’s withholding tax tables for foreign workers and cantonal tax calculation tools.

Coronavirus Guidance: Companies affected by the new coronavirus can postpone payment of social tax contributions – AHV (old-age insurance), IV (invalidity insurance), EO (income replacement), and ALV (unemployment insurance) through a temporary, interest-free payment deferral. Employers also have the option of having the amount of regularly recurring AHV, IV, EO, and ALV payments adjusted if the total wages paid by the company decreased significantly.

Agreements between Switzerland and France, Switzerland and Germany, and Switzerland and Liechtenstein, all effective retroactive to March 11, 2020, and between Switzerland and Italy, effective retroactive to Feb. 24, 2020, allow days worked at home by cross-border commuters who live in one country and work in the other, but must work at home because of the new coronavirus, to count as days worked in the normal work country. The agreements with France and Italy are to be in effect until the end of the month in which the last of the two countries ends restrictions of individuals’ movement, but the agreement with France was extended until March 31, 2022, and automatically extends to June 30, 2022, unless ended at least one week before March 31, 2022. The agreement with Liechtenstein was initially in effect until Oct. 31, 2020, and the agreement with Germany is in effect until at least Dec. 31, 2021, but the agreements with Germany and Liechtenstein automatically extend for one month at the end of each month unless one of the countries gives notice to end the agreement. A provision was added to the Germany agreement April 27, 2021, that employees working from home only because of Covid-19 restrictions do not create a permanent establishment for their employer in their country of residence.

Income Taxes

Employers in Switzerland are responsible for withholding income taxes only on the wages of foreign workers. All other individuals must pay their taxes annually when filing their returns, and employers are required to file annual salary certificates with the government. Withholding methods for foreign workers is covered under the Foreign Workers section. The Federal Tax Administration (Eidgenössische Steuerverwaltung, abbreviated as ESTV) oversees taxation in Switzerland.

Income taxes are levied at three different levels: at the federal level, at the cantonal level, and at the municipal (communal) level. Taxes assessed at the federal level also are known as direct federal taxes.

Coverage: All residents are subject to income tax on their worldwide income. Generally, residents are defined as those residing in Switzerland for at least 30 consecutive days while employed, or 90 consecutive days while unemployed over a 12 month period. Nonresidents are only taxed on their Swiss sourced income.

Employees: Generally, all foreign workers, who do not have permanent residence status in Switzerland but have tax domicile or tax residence, are subject to tax withholding at source.

Rates and Thresholds: Switzerland’s federal income tax rates are levied on a progressive scale, with rates ranging from zero to 13.2% for single taxpayers without children who are minors and from zero to 13% for married taxpayers and single taxpayers with children who are minors. In the country’s progressive income tax system, portions of an individual’s income are allocated to the country’s personal income tax brackets, and each portion of income allocated to a tax bracket is taxed at the tax rate applicable to that tax bracket.

Switzerland is rare among countries with progressive income tax systems in that the highest tax rate assessable on a portion of income in Switzerland’s version of tax progressiveness is not the rate assessable on the highest portion of assessable income, but rather is the rate assessable on the second-highest portion of assessable income. The rate assessable on the highest portion of assessable income for both progressive income tax scales of direct federal tax is 11.5%. This is because Article 128 of the Federal Constitution of the Swiss Confederation specifies that the overall effective rate of direct federal tax on income cannot exceed 11.5%, and for both progressive income tax scales of direct federal tax, the total amount of income tax progressively assessed via various rates up to the threshold at which the rate of 11.5% is in effect is equivalent to the total amount of income tax that would be assessed on income up to that threshold if a flat rate of 11.5% applied on all the income up to that threshold.

Switzerland’s federal personal income tax rates and tax bands for single taxpayers without children who are minors are as follows:

Range of Annual Income (Swiss Francs)	Income Tax Rate
Up to CHF 14,500	Zero
More than CHF 14,500 and up to CHF 31,600	0.77% on the amount in excess of CHF 14,500
More than CHF 31,600 and up to CHF 41,400	CHF 131.65 plus 0.88% of the amount in excess of CHF 31,600
More than CHF 41,400 and up to CHF 55,200	CHF 217.90 plus 2.64% of the amount in excess of CHF 41,400
More than CHF 55,200 and up to CHF 72,500	CHF 582.20 plus 2.97% of the amount in excess of CHF 72,500
More than CHF 72,500 and up to CHF 78,100	CHF 1,096 plus 5.94% of the amount in excess of CHF 72,500
More than CHF 78,100 and up to CHF 103,600	CHF 1,428.60 plus 6.6% of the amount in excess of CHF 78,100
More than CHF 103,600 and up to CHF 134,600	CHF 3,111.60 plus 8.8% of the amount in excess of CHF 103,600
More than CHF 134,600 and up to CHF 176,000	CHF 5,839.60 plus 11% of the amount in excess of CHF 134,600
More than CHF 176,000 and up to CHF 755,200	CHF 10,393.60 plus 13.2% of the amount in excess of CHF 176,000
More than CHF 755,200	CHF 86,848 plus 11.5% of the amount in excess of CHF 755,200

Switzerland’s federal personal income tax rates and tax bands for married taxpayers or single taxpayers with children who are minors are as follows:

Range of Annual Income (Swiss Francs)	Income Tax Rate
Up to CHF 28,300	Zero
More than CHF 28,300 and up to CHF 50,900	1% on the amount in excess of CHF 28,300
More than CHF 50,900 and up to CHF 58,400	CHF 226 plus 2% of the amount in excess of CHF 50,900
More than CHF 58,400 and up to CHF 75,300	CHF 376 plus 3% of the amount in excess of CHF 58,400
More than CHF 75,300 and up to CHF 90,300	CHF 883 plus 4% of the amount in excess of CHF 75,300
More than CHF 90,300 and up to CHF 103,400	CHF 1,483 plus 5% of the amount in excess of CHF 103,400
More than CHF 103,400 and up to CHF 114,700	CHF 2,138 plus 6% of the amount in excess of CHF 103,400
More than CHF 114,700 and up to CHF 124,200	CHF 2,816 plus 7% of the amount in excess of CHF 114,700
More than CHF 124,200 and up to CHF 131,700	CHF 3,481 plus 8% of the amount in excess of CHF 124,200
More than CHF 131,700 and up to CHF 137,300	CHF 4,081 plus 9% of the amount in excess of CHF 131,700
More than CHF 137,300 and up to CHF 141,200	CHF 4,585 plus 10% of the amount in excess of CHF 137,300
More than CHF 141,200 and up to CHF 143,100	CHF 4,975 plus 11% of the amount in excess of CHF 141,200
More than CHF 143,100 and up to CHF 145,000	CHF 5,184 plus 12% of the amount in excess of CHF 131,700
More than CHF 145,000 and up to CHF 895,800	CHF 5,412 plus 13% of the amount in excess of CHF 145,000
More than CHF 895,800	CHF 103,016 plus 11.5% of the amount in excess of CHF 895,800

Registration: All employers must register with the Commercial Register, a national registry with 31 offices located throughout Switzerland. While companies can commence in limited commercial operations before the completion of the registry, generally, registration should be completed before the commencement of commercial operations.

Taxable Amounts: Individuals’ tax liability is determined based on total remuneration minus allowable deductions. Deductions include deductions for dependents, child care, work-related expenses, pension contributions, medical insurance premiums, and other deductions.

Withholding Methods: Employers must withhold taxes from foreign workers (those without a C permit, a permanent residence permit) directly from their employer every month. This is called withholding tax. The employer directly pays this tax to the tax authorities in Switzerland. This amount varies from canton to canton and can change annually.

Returns and Remittance: Employers must file a Salary Certificate with the cantonal authorities and distribute a copy to all employees annually. Reporting deadlines vary by canton. The certificate details total remuneration paid, hours worked, social tax withholdings, pension withholdings, and other employment details.

Recordkeeping: Tax records must generally be kept for a minimum of ten years.

Penalties: Late payments will be subject to interest penalties on the 31st day after the tax assessment is received. Interest penalties range from 1 to 3%.

Social Taxes

Social taxes in Switzerland consist of an old age and survivors’ insurance scheme (Alters- und Hinterlassenversicherung, abbreviated as AHV), an invalidity insurance fund (Invalidenversicherung, abbreviated as IV), an income replacement/maternity insurance fund (Erwerbsersatzordnung/Mutterschaftsentschädigung, abbreviated as EO/MSE), unemployment insurance (Arbeitslosenversicherung, abbreviated as ALV), occupational benefits (berufliche Vorsorge, abbreviated as BV), occupational accident insurance (Berufsunfallversicherung, abbreviated as BUV), nonoccupational accident insurance (Nichtberufsunfallversicherung, abbreviated as NBUV), and family allowances (Familienzulagen, abbreviated as FZ). These funds are managed by the Federal Social Insurance Office (Bundesamt für Sozialversicherungen, abbreviated as BSV).

Coverage: All employers of persons who are domiciled or engaged in paid employment in Switzerland are subject to compulsory insurance withholdings and payments. Additionally, Swiss nationals working abroad for the federal government, for international organizations with whom the Federal Council has concluded a headquarter agreement, or for private volunteer organizations that receive substantial support from the government are also subject to social taxes. Persons working abroad for an employer in Switzerland and paid by that employer are exempt.

Rates and Thresholds: Effective for 2021, total social tax rates for employers generally range from 14.27% to 41.505%. Effective for 2020, total social tax rates for employers generally range from 13.845% to 41.505%.

Employers’ total social tax rates consist of the following component rates:

Old age and survivors insurance scheme: 4.35%;
Invalidity insurance fund: 0.7%;
Loss-of-income/maternity insurance fund: effective starting Jan. 1, 2021, 0.25%; effective until Dec. 31, 2020, 0.225%;
Unemployment Insurance: 1.1% for annual income up to CHF 148,200, and 0.5% for annual income of more than CHF 148,200;
Occupational benefits: minimum contribution rates vary between 7% to 18% depending on the pension plan; employer contribution must be at least equal to employee contribution;
Occupational accidents and diseases: contribution rates range from 0.17% to 13.5%, depending on the nature of business and risk involved; and
Family allowances: Effective for 2021, tax rates for employers vary among cantons and range from 0.7% to 3.5%, except the tax for agricultural employers is 2%. Effective for 2020, tax rates for employers varied among cantons and ranged from 0.3% to 3.63%, except the tax rate for agricultural employers was 2%.

Effective for 2021, total social tax rates for employees generally range from 14.4% to 28.375%. Effective for 2020, total social tax rates for employees generally range from 14.375% to 28.375%.

Employees’ total social tax rates consist of the following component rates:

Old age and survivors insurance scheme: 4.35%;
Invalidity insurance fund: 0.7%;
Loss-of-income/maternity insurance fund: effective starting Jan. 1, 2021, 0.25%; effective until Dec. 31, 2020, 0.225%;
Unemployment Insurance: 1.1% for annual income up to CHF 148,200, and 0.5% for annual income of more than CHF 148,200;
Occupational benefits: minimum tax rates vary between 7% to 18% depending on the pension plan; and
Non-occupational accidents: tax rates range from 1% to 4%, depending on the degree of risk involved.

Employees generally are not assessed a tax rate for family allowances, except employees in the canton of Valais are assessed a tax rate of 0.3%.

The maximum amount of annual wages on which taxes for occupational and non-occupational accidents are assessable is CHF 148,200.

The maximum amount of annual wages on which taxes for occupational benefits are assessable is CHF 85,320. There is no maximum cap for other social taxes.

Taxable Amounts: Social taxes are calculated based on total remuneration minus allowable deductions. Some allowable deductions include deductions for insurance payments, pension contributions, some business and employment related expenses, and other benefits.

Returns and Remittance: Employers with an annual payroll of less than CHF 200,000 must make quarterly payments and filings, while employers with an annual payroll of at least CHF 200,000 must make monthly payments and filings. All payments must be made by the 10th of the month following the month or quarter in which salary was paid. Employers must file annual returns, which summarize employees’ salaries and all contributions, by Jan. 30 of each year.

Some employers with an annual payroll of no more than CHF 56,160 are eligible for a simplified payment and filing procedure.

Registration: All employers must register with the cantonal compensation fund. After the company has registered with the Commercial Registry, the cantonal social insurance office (Ausgleichskasse) will send the employer an application for registering employees in the social insurance system. Registration may also be done online. Registration details vary by canton.

Recordkeeping: Generally, social tax documents should be kept for at least ten years.

Penalties: Late payments are assessed a 5% annual interest charge.

Other Taxes

Switzerland’s national government does not assess any taxes on employment income other than those covered in the Income Taxes and Social Taxes sections of this primer.

State/Jurisdiction Taxes

Income taxation in the 26 cantons consists of cantonal income tax, income taxes of communities (municipalities) within the cantons, and church income taxes (if the canton is religiously affiliated). Applicable ranges of tax rates and taxable income vary among cantons and communities within the cantons. In addition, some cantons levy an additional personal tax. The equivalent of the term cantonal taxes in French is impôts cantonaux, in German is Kantonssteuern, in Italian is imposte cantonali, and in Romansh is taglias chantunalas.

Generally, there is no withholding from wages paid to Swiss residents for cantonal taxes. All cantons tax the earned income of foreign workers without a permanent residence permit (C permit) at source via withholding tax, also known as tax at source. Employers of foreign workers who are working in a Swiss canton are obliged to deduct the canton’s tax due from their salary and to deliver this to the applicable tax authority. The deducted sums from foreign workers’ wages generally cover the income taxes of the confederation (direct federal tax), cantons, and communities, and sometimes include church taxes. The equivalent of the term tax at source in French is impôt à la source or alternatively retenue à la source, in German is Quellensteuer, in Italian is imposta alla fonte, and in Romansh is taglia a la funtauna.

Coverage: Coverage varies among cantons, but all individuals generally are subject to cantonal income tax. Residents are subject to taxes on their global income, while foreign workers are subject to taxes on their Swiss-sourced income. Residents and those with a permanent resident permit (C permit) are not subject to withholding at source and pay their cantonal tax on an annual basis. Nonresidents without a permanent resident permit (C permit) must have their income tax withheld at source. In the canton of Geneva, the income of minors also is taxed at source irrespective of nationality.

Rates and Thresholds: In some cantons, income tax rates are levied on a progressive scale based on family status or on a proportional basis (flat-rate tax). In other cantons, the applicable tax rate consists of two types of components: the simple tax rate set by law, and at least one tax coefficient that is periodically determined. A tax coefficient is a multiple, expressed in units or as a percentage, of the statutory simple rates. To obtain the actual tax rate, the simple rates are multiplied by cantonal and communal coefficients.

Withholding taxes are levied on a progressive scale and cover the income taxes of the confederation (direct federal tax), cantons, and communities, and sometimes include church taxes. Withholding tax rates vary based on canton of residence, family status, and gross salary.

The following table provides links to each canton’s withholding tax tables for foreign workers and cantonal tax calculation tools. The Cantonal withholding tables are also available from the Federal Tax Administration.

Canton	Cantonal Tax Withholding Tables for Foreign Workers	Calculation Tool for Cantonal Personal Income Tax, Other Cantonal Taxes
Aargau	Withholding Tables for Aargau	Calculation Tool for Aargau
Appenzell Ausserrhoden	Withholding Tables for Appenzell Ausserrhoden	Calculation Tool for Appenzell Ausserrhoden
Appenzell Innerhoden	Withholding Tables for Appenzell Innerhoden	Calculation Tool for Appenzell Innerhoden
Basel-Landschaft	Withholding Tables for Basel-Landschaft	Calculation Tool for Basel-Landschaft
Basel-Stadt	Withholding Tables for Basel-Stadt	Calculation Tool for Basel-Stadt
Bern	Withholding Tables for Bern	Calculation Tool for Bern
Fribourg	Withholding Tables for Fribourg	Calculation Tool for Fribourg
Geneva	Withholding Tables for Geneva	Calculation Tool for Geneva
Glarus	Withholding Tables for Glarus (Select “Quellensteuer” from scroll-down list)	Calculation Tool for Glarus
Graubünden	Withholding Tables for Graubünden	Calculation Tool for Graubünden
Jura	Withholding Tables for Jura	Calculation Tool for Jura
Luzern	Withholding Tables for Luzern	Calculation Tool for Luzern
Neuchâtel	Withholding Tables for Neuchâtel	Calculation Tool for Neuchâtel
Nidwalden	Withholding Tables for Nidwalden	Calculation Tool for Nidwalden
Obwalden	Withholding Tables for Obwalden	Calculation Tool for Obwalden
Schaffhausen	Withholding Tables for Schaffhausen	Calculation Tool for Schaffhausen
Schwyz	Withholding Tables for Schwyz	Calculation Tool for Schwyz
Solothurn	Withholding Tables for Solothurn	Calculation Tool for Solothurn
St. Gallen	Withholding Tables for St. Gallen	Calculation Tool for St. Gallen
Thurgau	Withholding Tables for Thurgau (Select “Quellensteuer” from table of contents, then select applicable year, then select “Quellensteuer Monatstarife” document)	Calculation Tool for Thurgau
Ticino	Withholding Tables for Ticino	Calculation Tool for Ticino
Uri	Withholding Tables for Uri	Calculation Tool for Uri
Valais	Withholding Tables for Valais	Calculation Tool for Valais
Vaud	Withholding Tables for Vaud	Calculation Tool for Vaud
Zug	Withholding Tables for Zug	Calculation Tool for Zug
Zürich	Withholding Tables for Zürich	Calculation Tool for Zürich

Registration: Generally, all companies must register in the cantonal Commercial Registry prior to the onset of commercial activities.

Taxable Wages: Generally, all residents’ income taxes is calculated based on their worldwide income minus allowable deductions, while nonresidents’ income taxes is calculated based on their income of Swiss income.

Returns and Remittance: For most cantons, a tax return must be filed every year normally within three months after the end of the tax period. Swiss nationals or foreigners holding a C permit will normally pay provisional tax through three installments during the year (June 30, Sept. 30, and Dec. 31) whilst in some cantons the taxes may be due on a monthly basis. Final taxes must be paid after the annual returns have been assessed. Specific filing requirements vary by canton.

Persons holding B or L residence permits, as well as nonresidents, will be subject to monthly withholding tax on their salaries, wages, or similar remuneration paid in Switzerland, as well as bonuses or similar remuneration. These withholding taxes may not be the final tax liability for the year and in many cases they will be a prepayment for the individual’s annual tax liability.

Recordkeeping: Records generally should be kept for at least five years.

Penalties: Penalties vary by canton.

COMPENSATION AND BENEFITS

Compensation and benefits laws are regulated by several federal offices which make up part of the Federal Department of Home Affairs and the Federal Department Economic Affairs. Although many labor laws are mandated at the federal level, they are often policed at the cantonal level. Individual cantons have additional labor laws.

For retirement plans, all employers are to provide their employees with occupational pension (berufliche Vorsorge, abbreviated as BV) funds, which are jointly funded by employers and employees.

There are several sources of labor law. The federal Code of Obligations (Obligationenrecht) sets out standards on matters including employment contracts and termination of employment. The Federal Labor Act (numbered SR 822.11, abbreviated as ArG in German, LTr in French, and LL in Italian) contains standards for many conditions of employment, including hours of work and overtime pay, and applies to most employers and employees with certain exceptions including senior managers, agricultural workers, and public transportation workers. In addition, collective labor agreements or cantonal regulations can provide for more employee benefits than federal law.

Minimum Wage

There is no national mandated minimum wage under Swiss law, although some cantons have generally applicable minimum wages.

Effective since Feb. 1, 2018, the minimum wage of the canton of Jura is CHF 20 per hour.

Effective for 2021, the standard minimum wage of the canton of Neuchâtel is CHF 19.90 per hour, and the canton’s minimum wage for workers engaged in the work of harvesting plants, grapes, and crops is CHF 16.92 per hour. Effective for 2020, the standard minimum wage of the canton of Neuchâtel is CHF 20.08 per hour, and the canton’s minimum wage for workers engaged in the work of harvesting plants, grapes, and crops is CHF 17.07 per hour.

A minimum wage law for the canton of Ticino took effect Jan. 1, 2021. However, minimum wages must be implemented by employers at the latest starting with wages paid for December 2021, and future increases must be implemented by December of a given year. Minimum wages vary by sector and are generally calculated as 55% of the Swiss median wage in the sector, as reported by the Federal Statistical Office’s Swiss Earnings Structure Survey, subject to minimum and maximum values. Effective starting Jan. 1, 2021, hourly minimum wages range from CHF 19 to CHF 19.50; by Dec. 31, 2023, hourly minimum wages must range from CHF 19.50 to CHF 20; and by Dec. 31, 2024, hourly minimum wages must range from CHF 19.75 to CHF 20.25. A list of minimum wages in effect starting Jan. 1, 2021, is available from the government of Ticino.

Voters in the canton of Geneva approved an hourly minimum wage in an election Sept. 27, 2020. Effective starting Jan. 1, 2021, the standard minimum wage in Geneva is CHF 23.14 per hour, the minimum wage for workers in the agricultural sector is CHF 17 per hour, and the minimum wage for workers in the floricultural sector is CHF 15.60 per hour. Effective from Nov. 1 to Dec. 31, 2020, the standard minimum wage in Geneva was CHF 23 per hour, the minimum wage for workers in the agricultural sector was CHF 16.90 per hour, and the minimum wage for workers in the floricultural sector was CHF 15.50 per hour.

Jura, Geneva, and Neuchâtel allow thirteenth-month bonuses, but not leave or holiday allowances, to be added to an employee’s base wage to determine compliance with the minimum wage.

Minimum wages may be established by private industries under a collective labor agreement (Gesamtarbeitsverträge, abbreviated as GAV). Collective labor agreements between employer associations and employee associations outline the minimum requirements for individual employment contracts for employees in applicable industries. Data regarding industries and employees covered by minimum wage provisions of collective labor agreements are available from the salary negotiatons webpage of the Federal Statistical Office.

Cantons may issue mandatory minimum wages for industries in which there is no collective labor agreement when there is excessive underpayment for that industry in relation to the average wages for a locality or profession.

Overtime

Under the Federal Labor Act, employers must begin to pay overtime for work over 45 hours per week for industrial workers, office personnel, sales staff in large retail stores, and some others, and 50 hours per week for all others. Employees are entitled to 25% extra pay for overtime hours or, if workers agree, to compensatory time off. The daily limit for overtime is generally two hours, and the annual limit is 170 hours for workers whose regular workweek is 45 hours long and 140 hours for those whose regular workweek is 50 hours.

Overtime pay may be waived in agreements. Additional overtime pay may be compensated through paid leave of at least the same duration. Generally, employees in managerial positions do not accrue mandatory overtime pay.

Hours of Work

Under the Federal Labor Act, the maximum number of hours in a workweek is 45 for industrial workers, office personnel, sales staff in large retail stores, and some others. The limit for other employees is 50 hours per week.

Employees are entitled to a rest break of at least 15 minutes if the workday is between five and half and seven hours long, at least half an hour if the workday is between seven hours and nine hours long, and one hour if the workday is nine or more hours long. Employees must also receive a daily rest period of at least 11 consecutive hours, which for adult workers may be reduced to eight hours once per week, as long as the average length remains 11 hours over a two-week period.

Night and Sunday Work: Night work, defined as work during the period from 11 p.m. to 6 a.m., and Sunday work, defined as work during the period from 11 p.m. on Saturday to 11 p.m. on Sunday, is generally prohibited without the employee’s consent and permission from the cantonal or federal government. Permission for temporary night or Sunday work must be granted by cantonal labor inspectorates, and permission for regularly recurring night or Sunday work must be granted by the State Secretariat for Economic Affairs.

Some professions and industries, such as nurses and hospital workers, doctors, pharmacists, newspaper and magazine editors, airports, railways, the tourist industry, and the communications and broadcasting industries, do not need permission for night or Sunday work.

For temporary night work, employees must receive 25% extra pay, and for regularly recurring night work employees must receive compensatory time off of at least 10% of the time that they have worked at night within a year.

Temporary night work is defined as work for a period of up to three months per year or a one-time period of six months, with a maximum of 24 nights worked. Temporary Sunday work is defined as work on up to six Sundays or holidays in a year.

Employees must receive 50% extra pay for temporary work on Sundays and must receive compensatory time off, whether the work is temporary or regularly recurring. If employees work up to five hours on Sunday, compensatory time off must be given, and if employees work more than five hours on Sunday, a replacement rest day must be given in the week before or after.

Holidays

Public holidays in Switzerland are determined by cantons, except for one federal holiday, National Day, on Aug. 1. All employees must receive paid leave on National Day, but cantons do not generally specify whether pay is required for other holidays. However, employees who receive monthly salaries generally receive paid leave for other holidays, while employees who are paid hourly wages generally only receive paid leave if specified by their employment contract. A second federal holiday, the Federal Day of Thanksgiving, Repentance, and Prayer, also known as the Federal Fast (Eidgenössischen Dank-, Buss- und Bettag, Jeûne fédéral, or Giornata federale di ringraziamento), falls on the third Sunday in September in all cantons except Geneva, and as it occurs on Sunday, paid leave is not required for this holiday.

Cantons are limited by the Federal Labor Act to naming eight holidays, which are afforded the same protections given to Sundays in the Federal Labor Act. These holidays generally are designated as identical to Sundays (den Sonntagen gleichgestellt, assimilés au dimanche, or parificato alla domenica). To circumvent the limit, cantons may name cantonal holidays, the employment-related protections of which are determined by the canton instead of the Federal Labor Act, and other holidays may be customarily observed, so that the number of holidays in each canton varies from seven to 14.

Employees also are entitled to time off to celebrate religious holidays not recognized by their canton, including non-Christian holidays, but must notify their employer at least three days in advance.

In Aargau, the declared public holidays vary among the canton’s districts, and a chart is available from the canton’s Office of Economy and Labor. Additionally, Fribourg and Solothurn, which both have primarily Protestant and primarily Roman Catholic districts, exempt Protestant areas from some primarily Catholic holidays.

Some holidays are public holidays in all, or nearly all, cantons. These holidays are:

Jan. 1, New Year’s Day (Neujahrstag, Nouvel an, or Capo d’anno), celebrating the start of a new Gregorian Calendar year, is a holiday in all cantons.
Good Friday (Karfreitag or Vendredi saint), the Friday immediately before Easter Sunday, is a holiday in all cantons except Ticino and Valais. Effective for 2021, the date of Good Friday recognized in Switzerland is April 2, 2021. Good Friday is a holiday that marks the death of Jesus Christ on the cross. Effective for 2020, the date of Good Friday recognized in Switzerland was April 10, 2020.
Easter Monday (Ostermontag, Lundi de Pâques, or Lunedi di Pasqua), the Monday immediately after Easter Sunday, is a holiday in all cantons except Neuchâtel, Solothurn, and Valais. Effective for 2021, the date of Easter Monday recognized in Switzerland is April 5, 2021. Effective for 2020, the date of Easter Monday recognized in Switzerland was April 13, 2020.
Ascension (Auffahrt or Ascensione), which occurs 39 days after Easter Sunday, is a holiday in all cantons. Ascension recognizes the Christian belief of the Ascension of Jesus Christ from the mortal realm to heaven. Effective for 2021, the date of Ascension recognized in Switzerland is May 13, 2021. Effective for 2020, the date of Ascension recognized in Switzerland was May 21, 2020.
Whit Monday (Pfingstmontag, Lundi de Pentecôte, or Lunedi di Pentecoste), which occurs 50 days after Easter Sunday, is a holiday in all cantons except Neuchâtel. Whit Monday is the day after Whit Sunday, also known as Pentecost (Pfingsten), and celebrates the Christian belief in the coming of the Holy Spirit as declared by Jesus Christ. Effective for 2021, the date of Whit Monday recognized in Switzerland is May 24, 2021. Effective for 2020, the date of Whit Monday recognized in Switzerland was June 1, 2020.
Aug. 1, National Day (Bundesfeiertag, Jour de la fête nationale, or Giorno festivo federale), commemorating the first alliance among three Swiss cantons (now four of Switzerland’s present cantons) under the Federal Charter of 1291, is a holiday in all cantons.
Dec. 25, Christmas (Weihnachtstag, Noël, or Natale), celebrating the birth of Jesus Christ and also celebrating togetherness of family and friends, is a holiday in all cantons.
Dec. 26, St. Stephen’s Day (Stephanstag, Saint-Étienne, or Santo Stefano), is a holiday in all cantons except Geneva, Jura, Neuchâtel, Solothurn, Valais, and Vaud, and is a holiday in most, but not all, municipalities in Aargau. In Appenzell Innerrhoden, Appenzell Ausserrhoden, and Uri, St. Stephen’s Day is not a holiday when Christmas falls on Monday or Friday.

Holidays that are observed by about half of the cantons include:

Jan. 2, sometimes called Berchtoldstag, is a holiday in Bern, Fribourg, Glarus, Jura, Luzern, Obwalden, Schaffhausen, Solothurn, St. Gallen, Thurgau, Vaud, Zug, and Zürich, and is a holiday in some municipalities in Aargau.
May 1, Labor Day (Tag der Arbeit, Fête du travail, or Festa dei lavoratori), is a holiday in Basel-Landschaft, Basel-Stadt, Jura, Neuchâtel, Schaffhausen, Solothurn, Ticino, Thurgau, and Zürich. In Solothurn, Labor Day is a half-day holiday that starts at noon. May 1 internationally is the most common date for Labor Day, celebrating workers around the world.
Corpus Christi (Fronleichnam, Fête-Dieu, or Corpus domini), which occurs 60 days after Easter Sunday, is a holiday in Appenzell Innerrhoden, Jura, Luzern, Neuchâtel, Nidwalden, Obwalden, Schwyz, Solothurn, Ticino, Uri, Valais, and Zug, and is a holiday in some muncipalities in Aargau and most municipalities in Fribourg and Solothurn. Corpus Christi honors the Christian belief in the Real Presence of Jesus Christ in the Eucharist. Effective for 2021, the date of Corpus Christi recognized in Switzerland is June 3, 2021. Effective for 2020, the date of Corpus Christi recognized in Switzerland is June 11, 2020.
Aug. 15, Assumption (Mariä Himmelfahrt, Assomption, or Assunzione), is a holiday in Appenzell Innerrhoden, Jura, Luzern, Nidwalden, Obwalden, Schwyz, Ticino, Uri, Valais, and Zug, and is a holiday in some municipalities in Aargau and most municipalities in Fribourg and Solothurn. Assumption commemorates the Christian belief in the ascension of the Virgin Mary to heaven.
Nov. 1, All Saints’ Day (Allerheiligen, Toussaint, or Ognissanti), is a holiday in Appenzell Innerrhoden, Glarus, Jura, Luzern, Nidwalden, Obwalden, St. Gallen, Schwyz, Solothurn, Ticino, Uri, Valais, and Zug, and is a holiday in some municipalities in Aargau and most municipalities in Fribourg and Solothurn. All Saints’ Day celebrates the life and work of all saints.
Dec. 8, Immaculate Conception (Mariä Empfängnis, Immaculée Conception, or Immacolata), is a holiday in Appenzell Innerrhoden, Luzern, Nidwalden, Obwalden, Schwyz, Ticino, Uri, Valais, and Zug, and is a holiday in some municipalities in Aargau and most municipalities in Fribourg. The holiday of Immaculate Conception recognizes the Immaculate Conception in Christian theology.

The holidays that are observed only by one or a few cantons are:

Jan. 6, Epiphany (Dreikönigstag or Epifania), is a holiday in Ticino, Schwyz, and Uri. Epiphany recognizes the revelation in the Christian tradition of the divinity of Jesus Christ.
March 1: In Neuchâtel, the anniversary of the canton’s founding.
March 19, Saint Joseph’s Day (Josephstag, Saint-Joseph, or San Giuseppe), is a holiday in Nidwalden, Schwyz, Ticino, Uri, and Valais. Saint Joseph’s Day celebrates the life and work of Saint Joseph.
First Thursday in April: in Glarus, the Pilgrimage to Näfels (Näfelser Fahrt), a ceremony held by the canton to mark the anniversary of the Battle of Näfels in 1388. If the holiday would occur during the week before Easter, as it would in 2021, it is moved to the second Thursday in April. Effective for 2021, the date of the Pilgrimage to Näfels recognized in Glarus is April 8, 2021. Effective for 2020, the date of the Pilgrimage to Näfels recognized in Glarus was April 2, 2020.
June 23: In Jura, the Commemoration of the Jurassic Plebiscite (Commémoration du plébiscite jurassien), marking the vote in 1974 to separate from the canton of Bern.
June 29: In Ticino, Saints Peter and Paul Day, commemorating the lives and work of Saints Peter and Paul.
The Thursday after the first Sunday in September: in Geneva, the Genevan Fast (Jeûne genevois), a traditional holiday of religious fasting. The Genevan Fast is observed in Geneva in place of the Federal Day of Thanksgiving, Repentance, and Prayer. Effective for 2021, the date of the Genevan Fast recognized in Geneva is Sept. 9, 2021. Effective for 2020, the date of the Genevan Fast recognized in Geneva was Sept. 10, 2020.
The Monday after the third Sunday of September: in Vaud, the Monday of the Fast (Lundi du Jeûne fédéral or Bettagsmontag). The holiday is the day after the Federal Day of Thanksgiving, Repentance, and Prayer. Effective for 2021, the date of the Monday of the Fast recognized in Vaud is Sept. 20, 2021. Effective for 2020, the day of the Monday of the Fast recognized in Vaud is Sept. 21, 2020.
Sept. 25: In Obwalden, Brother Klaus Day (Bruderklausenfest), commemorating Switzerland’s patron saint, Saint Nicholas of Flüe.
Dec. 31: In Geneva, the Restoration of the Republic (Restauration de la République), commemorating the anniversary of the restoration of the independent Republic of Geneva in 1813.

Additionally, individual municipalities may recognize additional holidays, including holidays listed in this primer that are not recognized by the canton in which the municipality is located.

If a holiday occurs on a weekend, employees are not entitled to paid leave and the holiday does not generally move, but Neuchâtel moves the holidays given for Christmas and New Year’s Day to Dec. 26 and Jan. 2, respectively, if they would occur on Sunday.

Christian holidays in Switzerland with varying dates among Gregorian Calendar years: Many Swiss public holidays for which paid leave is required are based on the date of Easter Sunday, which is a core holiday of Christianity that celebrates the traditional Christian belief in the resurrection of Jesus Christ. Each year, Easter Sunday is celebrated on the first Sunday after the first full moon is visible following the first day of Spring of that year. As Switzerland accords with the Western method for determining Christian holiday dates based on the Gregorian Calendar instead of the Eastern method for determining Christian holiday dates based on the Julian Calendar, the first day of Spring is considered to be the Vernal Equinox of March 21. The date of Easter Sunday varies among years because it is based on lunar cycles, which do not directly correlate to the Gregorian Calendar as it is a solar calendar, not one based on phases of the moon.

Effective for 2021, the date of Easter Sunday recognized in Switzerland is April 4, 2021. Effective for 2020, the date of Easter Sunday recognized in Switzerland was April 12, 2020.

Leave

Generally, employers must provide employees with four weeks of paid vacation days per year. However, employers must provide five weeks of paid leave per year to workers younger than 20. Employers must allow employees to take at least two weeks of vacation consecutively and cannot pay workers in lieu of granting them time to take vacation.

Additionally, if an employee is absent for more than a month of work within a year, an employer may reduce the holiday entitlement by one-twelfth for each full month of absence. If the absence does not exceed one month during the year and is due to personal circumstances, such as illness, accident, legal obligations, public duties or leave for youth work, the employer is not entitled to reduce the holiday allowance.

Sick leave: Swiss law requires employers to continue to pay employees who are unable to work due to illness for up to three weeks in the first year of employment and for longer periods at full pay proportionate to longer periods of employment. Cantons specify sick leave limits after an employee’s first year. Employers may require a medical certificate for any absence longer than three consecutive days due to sickness.

Military leave: Employees serving in the Swiss army, civil protection, or civilian service may not be terminated. Those in the army, Red Cross, civil protection, or civilian service are entitled to compensation from a national fund for loss of earned income. Military service is mandatory for Swiss men. Civilian service is an alternative open to those who object to military service on grounds of conscience.

Maternity leave: Both full-time and part-time employees are entitled to 14 weeks or 98 days of maternity leave. Mothers are paid 80% of their wages in the form of a daily allowance, but are not paid more than CHF 196 per day. Cantonal provisions, staff rules, and collective labor agreements may provide additional benefits. Women are not permitted to work during the first eight weeks after the birth and women who return to work earlier lose their entitlement to compensation.

Wage Payment

Wages must be paid at the end of each month or according to terms in the employment contract or collective labor agreement. Employers are required to provide employees with an individual earning statement, at least once a month, which details employee salary and relevant deductions.

Bonuses and Special Benefits

Switzerland does not require employers to provide bonus payments to employees, but many employers pay a bonus equal to one month’s salary towards the end of the calendar year known as a thirteenth-month bonus. The two cantons that have statutory minimum wages, Jura and Neuchâtel, allow thirteenth-month bonuses to be added to an employee’s base wage to determine compliance with the minimum wage.

Switzerland also requires other types of benefits.

Unemployment Insurance: All persons engaged in gainful activity in Switzerland who have not yet reached the statutory retirement age are required to have unemployment insurance. Contributions are equivalent to 2.2% of employees’ salary for salary up to CHF 148,200 per year, and an additional 1% solidarity contribution for salary of more than CHF 148,200. Half of the contributions are payable by the employee and half by the employer. The employer is responsible for making deductions from an employees’ paychecks, and paying contributions on a monthly basis. Registration to pay the tax varies by canton.

Retirement Plans: Switzerland’s law on occupational pension schemes (numbered SR 831.40, abbreviated as BVG in German and LPP in French, Italian, and Romansh) require all employers to provide their employees with occupational pension (berufliche Vorsorge, abbreviated as BV) funds, which are jointly funded by employers and employees. This is known as the second pillar of social assistance, with the first pension consisting of social taxes and the third of voluntary private pension funds. The BV is regulated by the cantonal authorities but mandated on a national level.

Coverage: Effective since Jan. 1, 2021, employers with workers who are at least 18 years of age with an annual salary of more than CHF 21,510 must make contributions to a provident institution entered in the register for occupational benefit plans. Effective from Jan. 1, 2019, to Dec. 31, 2020, the annual salary threshold was CHF 21,330.

Rate: Rates vary by provider, assessed risk level, and employee contract (e.g. full-time vs. part-time contracts). The BVG requires minimum contribution rates from 7% to 18% of employees’ salary, with contributions divided between employees and employers and rates varying based on employees’ age. However, employer contributions must be at least the same percentage of employee salary as the worker’s contributions.

Taxable Wages: BV is calculated based on employees’ gross salary, with a maximum computable salary, effective since Jan. 1, 2021, of CHF 86,040 per year. Until Dec. 31, 2020, the maximum computable salary was CHF 85,320 per year.

Registration: Employers must register with the social insurance system prior to the onset of commercial activities. After having registered with the cantonal Commercial Registry, the canton will inform employers of how to register in the social insurance system.

Returns and Remittance: The financing and reporting requirements of the BV funds vary by provider.

Recordkeeping: Cantonal authorities maintain differing recordkeeping requirements.

Penalties: Employers that make deductions without remitting employee contributions or violate the confidentiality required by law can be subject to up to six months of imprisonment or a fine of CHF 30,000. Employers that file fraudulent forms can be subject to a fine of CHF 10,000 or a prison term.

Termination Pay

In the absence of a contract provision or regulation, the following provisions for notice of dismissal apply based on the tenure of the employee:

trial period: seven days of notice;
first year of service: one month;
second to ninth year of service: two months; and
tenth year of service and beyond: three months.

With the exception of the trial period, employment contracts may only be terminated at the end of a month and the letter of notice must reach the addressee before the beginning of the period of notice.

Before going ahead with a collective redundancy (dismissal of several employees as a result, for instance, of relocation of production facilities, restructuring, financial problems) the employer must consult the employees concerned or their representatives and inform the cantonal employment office.

An employer or employee may terminate a contract without notice if there is just cause, which is generally defined in the Code of Obligations as being a condition that prevents one of the parties in good faith from being able to continue the employment relationship. If the employment contract is for a fixed term, the employment ends on the date set in the contract without a requirement to give notice.

At the end of all employment relationships, all employers must provide departing employees with a job reference or at least an attestation of employment which does not give the reasons of departure. This certificate is necessary for employees who wish to apply for unemployment benefits.

An employee who is at least 50 years old with 20 years or more of service is entitled to severance pay, which may be determined by written agreement, employment contract, or collective agreement but must be between two and eight months’ regular wages. The amount may be reduced or eliminated if the employee terminated the employment relationship without just cause or the employer terminated it for cause. If the employment relationship ended because the worker died, the worker’s spouse and children are entitled to the severance pay

Workers’ Compensation

Employers are required to have accident insurance for both occupational accidents and diseases (Berufsunfallversicherung, abbreviated as BUV), and nonoccupational accidents (Nichtberufsunfallversicherung, abbreviated as NBUV), which covers all employees in Switzerland, including apprentices and volunteers. The Swiss Accident Insurance Fund (Schweizerische Unfallversicherungsanstalt, abbreviated as Suva), an independent nonprofit company under public law, and other private insurance carriers provide the compensation. The employer and the employee pay premiums for different parts of the coverage. Generally, employers pays premiums for insurance against work accidents and occupational diseases, while employees pay premiums for insurance against non-work accidents. The employer pays the total amount to the insurance company and deducts the employee’s contribution from his or her salary. Premium amounts vary from 0.1% to 4% of employee gross salary according to the type of business and assessed risk.

Recordkeeping

Generally, documents that may be relevant in a labor dispute should be kept for up to ten years as the statute of limitations varies between one and ten years.

FOREIGN WORKERS

Foreign workers are entitled to the same rights as Swiss citizens and are generally covered by the same tax and workplace laws. However, income tax regulations vary.

Visas: Switzerland has different visa requirements depending on the origin of foreign workers. Under the EU-Swiss Agreement on the Free Movement of Persons (AFMP), generally, members of EU countries and EFTA countries may enter and work in Switzerland freely. However, they must obtain a residence permit from the Canton where they immigrate to within 14 days of entering Switzerland. EU/EFTA specific permits include:

L permits EU/EFTA (short stay permits),
B permits EU/EFTA (initial residence permits),
C permits EU/EFTA (permanent residence permits, and
G permits EU/EFTA (commuter permits).

Workers from other countries must obtain work permits and residence visas or permits in order to enter and work in Switzerland. Although Switzerland is a member party of the Schengen agreement, which allows individuals with a Schengen visa to travel between different member states with ease, Switzerland still requires citizens of non-EU and non-EFTA member states to obtain work and residence permits to work legally in Switzerland. That being said, Switzerland places strict restrictions on work permit requests and only grants permits to aliens whose employment is strongly needed and who are well-qualified and experienced.

In order to obtain work permits for their foreign workers, employers must apply to the cantonal migration office. Additionally, the foreign workers must obtain either a Schengen visa or national visa and one of the following residence permits:

B permit (initial residence permit),
C permit (permanent residence permit),
G permit (cross-border permit),
L permit (short stay permit),
F permit (provisionally admitted foreigners),
N permit (asylum seekers), or
S permit (for persons in need of protection).

In some cases, visa applicants may be required to have a sponsor. If an employer agrees to sponsor a foreign worker, they must file with the communal or cantonal migration office where the employer resides and agree to pay any uncovered costs in relation to the stay of the foreign worker up to CHF 30,000.

Taxes: Generally, individuals who do not stay in Switzerland on either a permanent basis or temporarily for a period of less than 30 consecutive days while employed, 90 consecutive days while unemployed or less than 183 total days, in a calendar year, and do not maintain close personal ties with Switzerland are considered to be nonresidents.

Unless such nonresidents have a Swiss permanent establishment (PE), own Swiss real property, or participates in an active Swiss partnership, they do not need to file a regular tax return and are not subject to ordinary Swiss income taxes. Those nonresidents subject to taxes, are only taxed on their income of Swiss origin.

Resident foreign employees other than holders of C permits have their tax deducted at source each month by their employer. Employers pay the deducted amounts direct to the tax authority. Tax rates vary between cantons.

A special wage withholding tax regime applies to individuals who work in Switzerland but reside near the Swiss border in Austria, France, Germany, or Italy (“cross-border employees”), and to individuals who work for a Swiss-controlled international carriers.

Wages/Payments: Switzerland does not have any restrictions on the payment of wages to foreign workers in addition to normal wage payment restrictions. Wages may be paid in foreign currency.

WORKING IN THE UNITED STATES

Foreign workers from Switzerland must meet general visa requirements and be certified to be employed in the U.S. General visa requirements for the U.S. are included in the separate

Switzerland is eligible for the visa waiver program for business visitors, which allows Swiss citizens to travel to the U.S. for 90 days or less for business-specific purposes without having to obtain a B-1 business visa. Stays longer than 90 days will require a visa. Individuals may return to the U.S. under the visa waiver program if a “reasonable length of time” has passed. The determination for reasonable length of time is at the discretion of the Department of Homeland Security.

Swiss workers are eligible to work in the U.S. under H-2B visas, which cover labor or services of a temporary or seasonal nature in occupations other than agriculture or registered nursing. The number of H-2B visas issued each year is limited by U.S. law.

U.S. employers also must check the names of all new-hires and employees against the Specially Designated Nationals and Blocked Persons List, administered by the Treasury Department’s Office of Foreign Assets Control (OFAC). Because OFAC prohibits financial transactions with individuals on the list, employers cannot employ them and may face fines for failing to comply.

For tax purposes, Swiss citizens are subject to U.S. employment-based taxation on income earned in the U.S. unless they can claim an exemption under certain tax treaty provisions or they work under specific visa types that exempt earnings from taxes. Switzerland has both a tax treaty and a social tax totalization agreement with the U.S.

State and local taxation of Swiss workers also can apply, although some states within the U.S. recognize international tax treaties that can eliminate that income tax liability for foreign workers.

The U.S. labor laws apply to all workers employed and providing services in the country.

Work eligibility as an employee is contingent upon Department of Homeland Security and Labor Department approval and the employee receiving a U.S. Social Security number from the Social Security Administration.

Tax Residency: In general, employees working in the U.S. on a temporary basis are considered nonresidents for tax purposes unless they qualify for resident status. Employees can be granted permanent resident status through the so-called green card test or if they meet the substantial presence test under the U.S. tax code. More information on these requirements is in the

Permanent residents are subject to U.S. tax requirements the same as U.S. citizens and are taxed under the U.S. system on their worldwide earnings.

Income Taxes: Generally, nonresidents in the U.S. who are from Switzerland and are working in the U.S. are subject to U.S. taxes based on their U.S.-sourced income. Income is taxed differently based on whether it is categorized as wage income or nonwage income, which includes interest and dividends.

A Form W-4, Employee’s Withholding Certificate, must be filed by each employee with their employer.

All nonresidents in the U.S. who are from Switzerland and are working in the U.S. must claim “single” in Step 1c, regardless of marital status; write “Nonresident Alien” or “NRA” in the space under Step 4c of the form; and may not claim “exempt” in the space under Step 4c.

Nonresident alien employees may adjust withholding using Step 2b or 2c of the Form W-4; certain employees also may be able to use Steps 3, 4a, or 4b. More information about Form W-4 requirements for nonresident alien employees is available in the

Although the versions of Form W-4 issued in 2020 or later significantly differ from the versions issued in 2019 or earlier, nonresident employees that filed a valid version of Form W-4 from 2019 or earlier with their employer do not need to file another Form W-4 with the employer unless they need to implement a change for their withholding. On Forms W-4 issued in 2019 or earlier, nonresident alien employees were required to check the “single” box on line 3, regardless of marital status; write “Nonresident Alien” or “NRA” above the dotted line on line 6; and were not permitted to claim “exempt” on line 7 of the form.

An additional amount is added to a nonresident alien employee’s wages for calculating federal income tax withholding, with the amount based on pay period frequency and the date of the employee’s most recently filed Form W-4. The table of additional amounts applicable to Forms W-4 from 2020 or later and the table applicable to Forms W-4 issued before 2020 are available in the

Nonwage income and self-employed foreign workers can be subject to income tax withholding at a flat rate of 30%.

Additionally, foreign workers may be taxed differently based on the specific type of visa they hold.

Tax treaties: Switzerland and the U.S. have a tax treaty with provisions addressing host country taxation of the nonresident workers. A summary of those benefits is listed in the Tax Treaty Exemption Comparison Chart. To claim the treaty benefit, the nonresident must file Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, with the employer.

Students and trainees in particular must include a statement with Form 8233 to claim a tax treaty exemption from withholding of tax on compensation for dependent personal services. This statement affirms that the student or trainee is temporarily in the U.S. and has accepted an invitation by the U.S. government (or by a political subdivision or local authority) for the purpose of studying or engaging in research by a university or other recognized educational institution in the U.S. It also must affirm that the individual will receive compensation for services performed in the U.S. There is no limit is placed on student and trainee compensation for Swiss residents.

Examples of the statements necessary to claim a treaty exemption from U.S. taxes are included in Internal Revenue Service Publication 519, U.S. Tax Guide for Aliens.

Social Taxes: Most foreign workers are subject to paying into the U.S. Social Security system. Foreign nationals who are exempt from paying income tax and who do not have the eligibility to receive a social security number may not be required to pay social taxes. Foreign workers contributing to Social Security for a certain time period may be eligible to receive benefits.

Generally, foreign workers in the U.S. that have specific visas as exchange visitors or students or who are temporarily in the U.S. for agricultural work are not subject to social taxes on income that is obtained from the purpose in which they originally entered the U.S.

Totalization Agreements: Social Security totalization agreements can allow foreign workers and U.S. nationals working abroad to avoid paying into two social security systems while being subjected to losing benefits for their home country system. Under totalization agreements, generally, foreign workers will only pay into one of the social security systems, either the home or the foreign system, but not both. Foreign nationals, utilizing a totalization agreement, also can count years of contributions paid to different social security systems to all of the systems they have contributed to in order to be eligible for benefits in one country.

Switzerland and the U.S. have entered into a totalization agreement and a summary of those provisions is included in

Wage Payment: Under certain visas for certain types of employment, employers are required to pay foreign workers the higher of either the prevailing wage or the actual wage that is paid to U.S. workers that have similar skills and qualifications.

There are no particular requirements that employees be paid in U.S. dollars.

TREATY ARRANGEMENTS

Switzerland has entered into more than 90 income tax treaties, including an income tax treaty with the United States . Switzerland also has more than 30 totalization agreements for social tax coverage purposes, including an agreement with the United States .

Switzerland’s tax treaties are available in

RESOURCES

All resources in English unless otherwise noted.

General

The Swiss Portal

CIA World Factbook: Switzerland

U.S. State Department: U.S. Relations With Switzerland

Currency Details

Unicode Consortium: Currency Symbols

International Organization for Standardization: Currency Codes - ISO 4217

United Nations: United Nations Terminology Database: Switzerland

Taxes

Federal Tax Administration (German)

Bundesgesetz über die direkte Bundessteuer [Federal Act on Direct Taxes], Dec. 14, 1990, SR 642.11 (German)

Federal Social Insurance Office (German)

Canton of Zürich: Income Tax Withholding (German)

European Commission: Your Social Security Rights in Switzerland

Federal Tax Administration: The Swiss Tax System

Compensation and Benefits

Code of Obligations, March 30, 1911, SR 220

Bundesgesetz über die Arbeit in Industrie, Gewerbe und Handel [Federal Act on Labor in Industry, Trade, and Commerce], March 13, 1964, SR 822.11 (German)

State Secretariat for the Economy: Collective Labor Agreements (German)

Federal Statistical Office: Salary Negotiations (German)

Federal Department of Justice and Police: Public Holidays in Switzerland (German, French, and Italian)

Initiative populaire “23 frs, c’est un minimum” [Popular Initiative “23 francs is a minimum”] Nov. 6, 2019, Geneva IN 173 (2020) (French)

Canton of Geneva, Arrêté relatif au salaire minimum légal pour 2020 et 2021 [Decree Regarding the Legal Minimum Wage for 2020 and 2021] Oct. 28, 2020 (French)

Canton of Neuchâtel, Mémento sur le salaire minimum [Memento on the Minimum Wage] (French)

Legge sul salario minimo [Minimum Wage Law] Dec. 11, 2019, BU Ticino 46 (2020) (Italian)

Canton of Ticino, Cantonal Minimum Wage (Italian)

Foreign Workers

Federal Department of Foreign Affairs

State Secretariat for Migration

Working in the United States

U.S. Department of Labor:

Foreign Labor Certification
Hiring Foreign Workers

U.S. Internal Revenue Service:

IRS Notice 1392, Supplemental Form W-4 Instructions for Nonresident Aliens
IRS Publication 15, Circular E, Employer’s Tax Guide
IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities
IRS Publication 519, U.S. Tax Guide for Aliens
IRS Publication 901, U.S. Tax Treaties

U.S. Department of State, Visa Waiver Program

Treaty Arrangements

State Secretariat for International Finance: Double Taxation Agreements (German)

Federal Tax Administration: International Tax Law (German)