Self-employed status is accorded to people who perform a gainful professional activity for their own account.
The self-employed have certain obligations with regard to taxes and national insurance.
Taxation of self-employed work
The Confederation and the cantons levy tax on income from self-employment. Income from self-employment is subject to the tax regime applicable for natural persons.
Fore more information, go to "Tax advantages".
Value-added tax (VAT)
As soon as annual turnover exceeds SFr 75,000, a self-employed person is required to pay VAT. The tax is calculated on the basis of gross turnover. On the tax return, the VAT payable may be deducted from the taxes that the person has paid as a customer on the various products and services that are subject to VAT (deduction of input tax).
Anyone who meets the conditions for paying VAT is required to register with the Swiss Federal Tax Administration (FTA) unsolicited within 30 days. The registration form can be downloaded from the Administration's homepage. The SME portal provides information about VAT and the turnover thresholds.
National insurance for the self-employed
Self-employed people are required to pay their national insurance contributions themselves.
The owners of unincorporated firms are subject to mandatory insurance requirements with the AVS/AI/APG and with a health insurance scheme. They are responsible for paying the contributions in full.
The SME Guide provides useful information in this regard.
The compensation fund determines whether you are entitled to self-employed status in the sense of the AVS. To obtain this status, you need to demonstrate that you perform various assignments for several different clients. This procedure is intended to prevent people claiming self-employed status when they are not entitled to. At the same time, people registered as self-employed are not permitted to contribute to unemployment insurance and are not covered by this insurance should their activities decline or cease.
Occupational pension planning for the self-employed
Self-employed status is based on the AVS criteria. People who work for their own account are not required to contribute to the occupational pension scheme, but they may do so if they wish.
In addition, if you cease a salaried activity to take up self-employment, you can request the disbursement of the funds under the second pillar of the state pension scheme to constitute starting capital.
Self-employed people who wish to take out pension insurance can pay into the third pillar (linked pension plan) and deduct higher amounts from their income than employees.
As a result of bilateral agreements between Switzerland and the European Union, nationals of the EU and the EFTA may in principle be self-employed in Switzerland. A brochure entitled "European Nationals in Switzerland (pdf)" contains more information.
Nationals of third countries are not permitted to work independently in Switzerland. Self-employment is not generally authorised until a permanent residence permit (permit C) has been obtained. The cantonal labour and migration authorities are responsible for all questions relating to self-employment.
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