Declaration of salaries

Tue, 03.10.2023, 12:00

Declaring wages can be tricky. In this blog post, we offer businesses some insights and useful tips on how to get to grips with this process. Whether you're a start-up or an established business, let's take your payslip to the next level together!

What are the deadlines for reporting wages?
Employers must report the wages they pay to their employees to the compensation fund within 30 days of the end of the settlement period. The salary declaration form must be completed and sent to the compensation fund before 30 January. If the employer does not complete the forms on time, interest may be charged. In short, it is important to respect the deadlines to avoid unpleasant surprises.
 
What payroll amounts need to be declared?
In order to determine the individual contributions paid by each employee, it is imperative that the salaries paid by the employer throughout the year are correctly declared. This procedure is essential for recording employees' individual earnings, which is of great importance for assessing their future benefits. The payroll declared must include all salaries subject to OASI/DI and IC contributions paid during the calendar year. In addition, the employer must also declare any salaries credited or paid during the year for previous activities. It is crucial to note that salaries subject to OASI/DI and IC are also subject to the family allowance fund.
 
Transmission of salary information to the OASI Fund
Once all the salary information has been correctly declared, the employer must send it to the OASI fund. They can choose to do this in the form of a text file (txt) or table (xls), or use the ELM standard salary declaration procedure, which uses an XML file format.
 
What solutions are there for managing salaries?
Managing salaries can be tedious for employers, but there are solutions. Larger companies can hire a dedicated accountant, but this can be expensive. Smaller companies can use software such as Bexio to simplify the creation of payslips. However, payroll management is complex, so if you're unsure, it's advisable to call in the professionals to avoid costly mistakes. Proper payroll management is crucial to your company's financial health!
 
Example of a Swiss payslip
You've raised an essential subject for Swiss workers: the payslip. Here is a concise explanation of its contents:
 

• Gross salary: The total amount of your remuneration before social security deductions and tax.
   
• Health insurance: A compulsory contribution to cover medical expenses in Switzerland.
   
• OASI/DI/IC: Contributions for old-age and survivors' insurance, invalidity insurance and loss-of-earnings allowance.
   
• ALV: Contribution towards compulsory accident insurance.
   
• Withholding tax: Tax deducted directly from wages by the employer in Switzerland.
   
• Net salary: The amount actually paid after social security deductions and tax.

 
However, please note that social security deductions and taxes may vary depending on your personal situation (place of residence, marital status, dependent children, etc.). It is therefore advisable to consult a chartered accountant or a payroll service for an accurate payslip. For those lucky enough to work with an attentive employer, understanding your payslip can be easier without consulting a chartered accountant.
 
Calculating gross and net pay in Switzerland
Calculating net pay in Switzerland depends on a number of factors, including gross pay, the employee's marital status, the number of dependent children and place of residence. And because social security contributions and withholding tax can vary depending on each employee's situation, it's advisable to consult a chartered accountant or payroll service to obtain an accurate estimate of net salary. Fortunately, tools such as HelloSafe can help you convert gross pay into net pay quickly and easily, without having to rack your brains.
 
How do I draw up a payslip in Switzerland?
To draw up a payslip in Switzerland, follow these steps
If you want to draw up a payslip in Switzerland, it's important to follow a few key steps: 

1. First, gather the necessary information, such as gross salary, social security contributions (health insurance, OASI/DI/IC/ALV), withholding tax and net salary.
    
2. Calculate the social security contributions based on the employee's situation (marital status, number of dependent children, etc.). Social security contributions include health insurance, OASI/DI/IC and ALV.
    
3. Calculate the withholding tax.
    
4. Finally, calculate the net salary, which is the amount remaining after deduction of social security contributions and withholding tax. 

 
Is it compulsory to have a payslip?
Swiss law is very clear on this point: every employee must receive a payslip with every salary payment. The payslip must contain all the necessary information, such as the gross salary, social security contributions, withholding tax, net salary and other details such as the employee's name and address, the pay month, the hourly rate and the number of hours worked. And of course, a little humour won't go amiss in this serious situation!
 
How can IFJ help you?
As we've already mentioned in this blog post, there are many details to consider when managing payroll. If you need help, IFJ offers a fiduciary service in collaboration with a partner. Take a look if you're interested!