The Umbrella Structure
The Swiss System
Swiss quality of life
Switzerland is a country that offers a unique quality of life, one that few regions in the world can even aspire to.
The beauty and variety of the landscape, low crime rate, an excellent healthcare system, a high standard of education, first-class sporting infrastructures, modern and efficient public services, legendary cleanliness and of course, the precision for which the country is renowned well beyond its borders.
This quality of life is based, among other things, on a well-thought-out administrative and social system:
The Swiss social protection system covers the following areas:
- Health insurance (LAmal) and compensation for loss of earnings (APG) during maternity leave
- Old-age, survivor's and disability insurance schemes made up of 3 “pillars", i.e. the AVS-AI (pillar 1), the occupational pension scheme PP (pillar 2) and optional individual pension and insurance provisions (pillar 3)
- Occupational or non-occupational accident insurance (AA)
- Unemployment insurance (AC)
- Family benefits
With the exception of pillar 3, all of these insurance types are compulsory.
Old-age, survivor's and disability insurance
This area is based on three pillars:
- pillar 1, that of the public authorities, is made up of the AVS and the AI. The annuities from these two types of insurance are intended to cover the basic needs of the parties insured. The first pillar is compulsory for everyone, including independent contractors and those not gainfully employed.
- pillar 2 (LPP) complements the first pillar with occupational old-age, survivor's and disability insurance. These two pillars guarantee at least 60% of their last salary for insured parties who retire. Only those employed are subject to the second pillar by law.
- pillar 3, the individual pension and insurance arrangements aimed at covering further needs, is optional but unlike other forms of savings it offers certain tax benefits. The funds can only be paid out in the event of certain incidents (retirement, death or invalidity) or, under certain circumstances, for the purchase of their own place of residence.
Within the Federal scheme, family allowances are managed by the cantonal social security offices and, within the cantonal schemes, by the family allowance funds (recognised professional or interprofessional funds and cantonal funds).
Compulsory health insurance
Compulsory health insurance guarantees access to a range of quality medical care and appropriate medical treatment for everyone living in Switzerland within their canton of residence. Health insurance for medical expenses is required under Swiss law. This private insurance, which must be taken out within 3 months of your arrival in the country, is the responsibility of the employee. The amount varies depending on the level of cover you require.
Taxes and duties in Switzerland
Taxes and duties in Switzerland are complex as the rules vary depending on your permit type (cross-border or Swiss residence permit), your salary level and your canton of employment. Taxes in Switzerland are also made more complex by the number of cantons (the applicable taxation differs from one canton to the next). The method of calculating tax in Switzerland is, however, rather simple compared with other countries.
The legal system
As a foreigner, an employment contract is not in fact sufficient to work in Switzerland, you must also have a Swiss work permit. The Swiss work permit is an official document issued by the population service in your canton which allows you to work in Switzerland.
External publications and links
- General information and explanations about taxation in Switzerland on the Confederation portal site
- How the tax system in Switzerland works on the Federal Tax Administration site
- All your questions about Switzerland:
- The social system:
- The amount of social security contributions
- The healthcare system
- Work permits
- Switzerland in general
- Tourism in Switzerland