Switzerland is a favorite destination for ex-pats and those looking for a stable income and a good quality of life. The country is known for some of the world’s highest salaries, which translates to a high cost of living.
So what is a good salary in Switzerland?
A monthly salary between $6,400 and $7,500 is a good salary in Switzerland. This amounts to an annual gross salary of approximately $96,755. With this salary, you can afford a luxurious apartment, good food, entertainment, and everything that makes life comfortable.
You may need to earn more if you move to cities like Zunich and Geneva, as they are among the most expensive cities in the world.
The huge expenses in the two cities are compensated by low taxes, high wages, and payments for a high standard of living.
Keep reading to learn more about salaries in Switzerland at various income levels.
What are the average salaries in Switzerland, and what is the quality of life they offer?
1. Monthly salary of between $6,400 and $7,500
With this salary, you can live a good life as a middle-income earner. You can afford to travel and be entertained during your weekends. Here is a breakdown of your monthly expenses.
- Rent- $2,500 – $3,000
- Food- $700 – $900
- Health insurance– $500- $600
- Transport across cities– $600 a year
- Household expenses– $300
- Childcare- $300 – $450
- Entertainment- $600 – $1,000
- Savings-$1,000
The above expenses are for a family of four living in a two-bedroom apartment in any major city. Entertainment includes eating out, attending events, going to the gym, and local getaways.
Even if you take these numbers to the highest per month, a salary of $96,755 will be enough for your family.
2. Salary of $130,000 per year or $10,000 per month
With the above salary, you can live comfortably with a family of four in the major cities of Switzerland. Mostly, this salary range is for skilled and educated people like lawyers, teachers, doctors, etc.
Here is a breakdown of the expenses the amount can cater for.
- Rent- $2,200 – $3,750 (depending on the location).
- Health insurance– $750
- Childcare- $600 – $800 (in major cities)
- Food- $750 – $1,072 (when cooking at home)
- Shopping and entertainment– $4,568
- Household expenses– $700
- Savings- $1,500
With this income, you can afford expensive and luxurious sports like golfing and skiing. You can also shop at the high-end Switzerland stores and go for family vacations at least two to three times a year.
However, your expenditure depends on where you live. Rental prices in Switzerland vary significantly. If you also work in a different city and commute daily, you must consider buying a car or planning a yearly train ticket expenditure.
How is taxation in Switzerland?
Switzerland is not notorious for high taxes, unlike many other European countries. The average rate you should pay for income tax and social security contributions is 10 to 30 percent of your gross salary.
The final rate of taxation will depend on your location. Different cantons and municipalities have different tax rates.
Anyone living in Switzerland must pay taxes. Most taxes in Switzerland fund large government projects and local initiatives that significantly impact many cantons.
There are many types of taxes in Switzerland, differing in exemptions and deductions. Therefore, you should consult a tax advisor for tax payment advice, especially if you make a lot of money.
Here is a brief overview of the different types of taxes you should expect in Switzerland.
1. Federal income tax
This tax is special because it’s the only one administered by the federal government.
Federal taxes, as mentioned, are used for funding large projects such as national service and public transport. There is progressive taxation for any money you earn in Switzerland.
Your salaries are combined and taxed as one payment if you’re married. The taxation rate for couples may even be reduced by 0.5 percent.
2. County and local taxes
Also known as Stadts und Gemeindesteuern, the municipalities and cantons charge this type of tax. The money is then used to fund essential county services, local transport, maintenance and emergency services, among other local county projects.
Most of the local taxes are set by the community needs, such as road, sewage, and street lighting maintenance.
The county and local taxes are divided into two categories: canton income tax and cantonal wealth tax.
The canton income tax is charged to the employed, those in business, or freelancers. The community’s needs determine the rate of these taxes.
On the other hand, the cantonal wealth tax is charged on all your assets in Switzerland and abroad. The tax charges are done annually at a rate of one to three percent of your total assets.
Now that I’ve discussed the basics of taxes in Switzerland, how much do I pay for taxes from my gross salary? The amount depends on how much you earn.
For instance, if your salary is slightly above $100,000, expect to pay the following taxes:
- Canton tax: $5,230
- Communal taxes: $6,224
- Personal tax: $26
- Direct Federal tax: $2,032
- Total tax: $13,512
The total taxes paid from a salary of $100,000 are $13,512 per year, which is manageable. Following this example, your tax rate will be at most 15 percent, which is significantly low compared to other European countries.
Remember, if you are employed, you must contribute to social funds such as unemployment, pension and others.
How much does the average person make in Switzerland?
The average person in Switzerland earns an average salary of between $5,000 and $6,000 per month. This translates to $60,000 to $72,000 per year.
However, wages in Switzerland are significantly determined by your job type.
Let’s look at how much a person can make in different industries and positions in Switzerland.
- Cleaners/waiters/cashiers – On average, people in these positions make around $5,200 per month.
- Professionals- This category includes lawyers, doctors, teachers, and engineers, who earn between $90,000 and $130,000 per year.
- Directors/managers- These are the highest-paid people, earning between $130,000 and $250,000 per year. CEOs can earn up to $468,000 annually, depending on their organization.
The above salaries may differ between men and women. Men in Switzerland are more favored and paid 40 percent more than women because of the gender gap in the country.
Only 25 percent of the population in Switzerland earn salaries above $6,000 per month.
How much are specialists paid in Switzerland?
The average salary for a specialist in Switzerland is approximately $115,000 annually but could be more due to additional pay such as commissions, tips, and cash bonuses. Orthopaedic doctors are the highest-paid specialists in Switzerland, followed by radiologists.
Which cities in Switzerland have the highest salaries?
Knowing the cities that offer the highest salaries in Switzerland is essential because it will help you decide where to settle. Here is a list of the country’s highest-paying cities and their consumer value.
Zurich
Zurich is the capital of Switzerland and among the highest-paying cities in the world, with a net wage of $50 per hour.
Based on the significant professionals, salaries in the city are 30 percent higher than in major cities like New York, London, and Amsterdam. Low social security deductions and taxes are the major advantages of Zurich.
Here is an average income per annum for various professions in Zurich.
- IT manager- $102,000
- Teacher- $61,300
- Chef- $136,000
- Web designer- $75,000
- Operations manager-$145,000
Regarding expenses, Zurich is also among the most expensive cities in the world. A meal for a family of four here will cost you $60 on average, while a three-bedroom house costs approximately $2,500.
Without rent, Zurich’s expenses for a family of four will be about $1,940 per month.
Geneva
Geneva is a big city and a center of commerce in Switzerland.
As of 2021, the GDP of Geneva was $117,000, translating to huge salaries in various job positions. Here are some of the wages per year.
- Pharmacist- $31,000
- Attorney- $94,500
- Chef- $32,000
- Office manager- $75,000
- IT manager- $125,000
The daily prices in Geneva are also high. For instance, a family of four will spend $55 per meal and $1,600 as monthly costs, excluding rent and utilities.
Neuenburg
Neuenburg is the capital city of Neuchatel in western Switzerland. The GDP of Neuenburg for the last two years has been $99,000, thus adding to the list of the most expensive cities. Let us look at the salaries of different positions in this canton.
- Quality engineer- $75,000
- Commercial manager- $64,500
- Accounting clerk- $86,000
- HR Assistant- $73,000
- CEO- $161,000
In a day, a family in this city can spend $58 per meal and $1,200 monthly on household expenses, excluding rent.
How are salaries in Switzerland paid?
Salaries in Switzerland are paid monthly on a 13-month system. This means that a yearly salary is paid in 13 installments.
The payment process is challenging for employers because they must liaise with the tax collection authorities and confirm that the tax deductions are correct before disbursing their employees’ salaries.
Are there employee benefits in Switzerland?
Following the high pay rates and standard of living in Switzerland, employers must give their employees strong and competitive benefits packages. This is more so for those in industries that require specialized skills.
So what are the mandatory benefits that must be given to Swiss workers? Let’s take a look.
Retirement benefits
- Social security
This benefit provides a basic income level for most pensioners in the country. The social security benefits are paid to men above 65 years and women above 64 years.
All persons with earnings and legal residence in Switzerland must be insured. The benefits are also extended to Swiss citizens working for Swiss employees abroad.
The social security contributions are equally shared between employee and employer and are paid based on the total income. The minimum pension for a single person is $15,400 per year, while that of a couple is $30,840 per year.
- Pension scheme
This type of benefit consists of voluntary and mandatory pension coverage entirely sponsored by the employee.
Employers develop a well-established and maintained salary plan for their employees. This benefit covers employees under social security with a yearly earning of 75 percent of their annual pension. The employer pays 50 percent of the pension scheme.
- Survivor’s benefits
This type of benefit is given to a surviving spouse or dependent children to prevent them from facing difficult financial situations after the death of their partner or parents.
However, for survivors to get these benefits, the deceased must have contributed to the AHV system for not less than one year. The survivor pension for orphaned children is 40 percent of the pensionable salary, while that of the spouse is 80 percent of the same.
- Disability insurance
This type of insurance system provides relief to people with disabilities or those in the process of rehabilitation, and it is compulsory. The insurance enables disabled people to integrate into society while supporting themselves partially.
The support in this insurance system ranges from early interventions to allowances and other payments that replace the salary of the disabled person.
The employer and employee pay for this type of insurance. Self-employed people must also contribute 1.4 percent of their incomes to this insurance. Your qualification for this benefit depends on the nature of your disability, but the insurance is open to anyone living and working in Switzerland.
- Employee perks
Following the stiff competition in the labor market in Switzerland, employers offer several other fringe benefits to their employees to retain them.
Here are these employee perks:
- Communication – This entails the provision of notebooks or mobile phones to employees.
- Education – Reimbursement of education costs mostly in multinational companies.
- Company cars – Executive employees in companies mainly enjoy this benefit.
- Meals – Some companies have onsite cafeterias where employees can enjoy a fully or partially paid lunch. This is more so in big companies.
- Training and development – Include staff training and coaching to empower employees in their careers.
- Flexible working hours – Some companies offer flexible working hours or allow their employees to work from home.