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I plan to become self-employed in a few months and am looking into what my costs will be with regards to social security contributions. Will I pay more for social security when I become self-employed than I do now as an employee?
As an employee, half of your social security contributions are paid by your employer. That means that you only pay the equivalent of 6.25% of your salary rather than the full contributions which are equivalent of 12.5% of your eligible income. Employees are not expected to contribute towards the child benefits scheme at all (except in Valais, where employees also contribute).
When you become self-employed, you will have to pay your contributions in full yourself. You are not eligible for unemployment insurance from social security, so you do not have to pay unemployment insurance premiums. In total you pay the equivalent of between 5.223% and 9.700% of your eligible income in social security contributions. The rate you get depends on your income.
If you have an annual income of between CHF 9400 and CHF 17,200, the rate is 5.223%. At the highest end, a 9.7% rate applies to incomes of CHF 56,400 or more.
Self-employed persons are also obligated to contribute to the child benefit scheme (FZ/AF). Required child benefit scheme contributions vary between cantons. As of January 2017, self-employed persons in the Canton of St. Gallen pay a contribution equal to 1% of your income. In Zurich, self-employed individuals must contribute the equivalent of 1.2% of their income to the scheme. In Aargau this contribution is equivalent to 1.35% of your income. In Grisons, 1.65% of your income goes to the child benefit scheme. In Vaud, you must pay the equivalent of 2.15% of your income into a child benefit scheme.
Example: A self-employed person with a monthly income of CHF 5000 doing business in the canton of Zurich can expect to pay around CHF 485 per month towards social security insurances plus CHF 60 francs per month into a child benefits scheme. In this case your total social security expenses would come to around CHF 545 per month.
