Salary in Euros / Bank Account

Hello,

my work contract (ANOBAG Status) provides a salary in Euros  paid in Euros. Do you think I should open a Bank Account in Euros, in order to better decide the time at which I make the conversion from euros to CHF?  I already have a bank account in CHF. 

Best regards, Anne 

Hello Anne,

From a financial perspective, opening a euro account in which to receive a salary in euros is a good move.

The currency exchange rates used by most banks when euros are received into Swiss franc accounts are not very favorable. By receiving euros into a euro account instead of a Swiss franc account, you avoid automatic currency conversions at poor exchange rates.

Using a euro account also gives you the option of waiting and exchanging your euros into Swiss francs when the exchange rate is favorable. Additionally, you can choose to use a third-party currency exchange service (a currency broker or peer-to-peer exchange, for example) with favorable exchange rates and then transfer the Swiss francs into your Swiss franc account.

Important: Many Swiss banks charge fees when you deposit euros in cash and when you withdraw euros in cash. The fee is typically a percentage of each deposit or withdrawal (1%, for example), and in many cases a minimum fee per cash transaction in euros applies (20 francs, for example). If you expect to make cash deposits or withdrawals in euros, make sure to review these fees when choosing a Swiss euro account. These fees are typically called disagio (fee for deposits) and agio (fee for withdrawals), and are generally published in account fee schedules.

Social Security

It is important to consider how receiving a salary in euros will affect your Swiss social security contributions as an ANobAG employee.

You must state your salary in Swiss francs when registering as ANobAG with the social security office. If you receive your salary in euros, you will have to state your estimated salary in Swiss francs. Your social security contributions will be based on the stated salary.

However, if the value of the euro against the Swiss franc increases, resulting in your actual salary in Swiss francs as per your tax returns being higher than your stated social security salary, you may be charged additional social security contributions in retrospect. You should account for this by setting aside extra money towards possible additional social security bills (in some cases, it can be several years before you receive these).

The exact opposite is true if the value of the euro decreases against the Swiss franc, in which case you may get money back or your stated salary may be adjusted.

Best regards from Moneyguru

Thanks a lot for this very useful information!