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Currently, there is no updated version of the instructions for completing the salary certificate for 2023. The version as of 1 January 2022 is still valid. Further explanations can be found in the questions and answers (FAQ) on the salary statement (only available in German, French and Italian).
In 2022, pandemic-related short-time work compensation (Kurzarbeitsentschädigungen; KAE) continued to be paid. Until 31 December 2022, it is also possible to have the KAE for the years 2020 and 2021, which has already been processed in the summary procedure, reviewed in order to receive any subsequent payment for vacation and holiday entitlements.
According to margin no. 34 of the «Guidelines for completing the salary statement and pension statement», short-time work compensation should be declared in cipher 7 of the salary certificate «Other benefits».
Pandemic-related short-time work compensation has given rise to a number of challenges. Firstly, the summarised procedure used for this compensation may mean that employers are unable to allocate the payments to individual employees. Secondly, some employers continued to pay employees affected by short-time work their full salaries. Or employers felt no need to reflect this practice in their payroll accounting. As a pragmatic solution to this situation, the following note could be added under cipher 15: «This employee was affected by short-time work in 2022».
In principle, employers are still not required to record the home office days of their employees on the salary certificate. Nevertheless, documentation can be useful. Particularly in an international context, inquiries from (foreign) authorities are to be expected. Especially in the case of cross-border commuters, the employer must ensure on the one hand that the social security deduction is correctly allocated. On the other hand, they must exclude the foreign working days in the withholding tax calculation (if a deduction must be made) in accordance with circular 45. This can only be done correctly if the employer knows when and where their employee has worked. The employers should document this properly with a travel calendar. We will be happy to support and advise you individually on this topic.
During the pandemic, Switzerland had signed so-called mutual understanding agreements with the neighbouring countries of Germany, France, the Principality of Liechtenstein and Italy. These govern the taxation rights of the states concerned (handling of non-return days etc.). Since the pandemic-related measures have been lifted, the states have partially terminated the agreements in 2022 or have retained them as a transitional solution:
In accordance with this different legal starting position, the following circumstances must be dealt with individually (not conclusively):
In principle, the affected employees who worked exclusively in their home office due to the pandemic can be taxed as if they had spent these days at their usual place of work. Caution is required in the case of the other circumstances mentioned above or even «fake» home office. In this case, the employee works/worked in their vacation home abroad, for example. In such a case, we recommend a detailed analysis of the situation.
Switzerland has never had an agreement with other countries, including Austria. Consequently, employers must exclude working days abroad from taxation in accordance with the OECD Model Tax Convention.
Tax rules may differ from the principles of social security liability and must be evaluated on a case-by-case basis. We are happy to assist you in the evaluation and implementation of such cases. Thanks to our global payroll network, we can also assist you in the calculation and processing of foreign social security contributions.
For the tax year 2023, the maximum deduction for travel expenses will increase from CHF 3,000 to CHF 3,200 due to the compensation for the cold progression. Otherwise, the standard deductions for professional expenses will not be adjusted. The same applies to the valuation of benefits in kind.
The totally revised Swiss Data Protection Act (revDSG) – and the associated new obligations for companies – will definitely come into force on 1 September 2023. The basic principles of data protection remain unchanged. For example, compliance with the familiar processing principles – including transparency, purpose limitation and data security. Many of the changes are in line with the European General Data Protection Regulation (EU GDPR). They include suppression of the protection of legal entities, introduction of an obligation to report data losses and breaches of data security, expansion of information obligations (these must be documented with a directory; the conditions are dependent on a specific minimum size of the companies), significant changes to data exports and stricter sanctions compared to the current law. Since the revised law does not provide for any transition periods, we recommend that companies and employers prepare for it now.
For our payroll outsourcing services, we can produce the ISAE 3402 Type II attestation according to the «International Standard of Assurance Engagements». The annual report is available in July of the following year. Upon request, we will be happy to provide you with the current report for 2021.
This attestation is designed to give our clients – as responsible decision-makers – the reassurance that our payroll outsourcing services are covered by an adequate internal control system and that all relevant business processes are monitored. The Type II report confirms that we have established all required controls and implemented them over a defined period of time.
We recommend that you send our ISAE attestation to your auditors. This may help with the planning and have a positive impact on the cost of the audit, as it will cut down on the audit actions required in connection with payroll outsourcing. We will be happy to provide you with the document on request and answer any questions you may have.
If you need support with payroll processing in the event of short- or long-term absences such as maternity/paternity/caregiver leave, illness, accident or fluctuation, we will be happy to support you on site or remotely. Depending on your needs, we will provide you with the right person from our team of payroll experts. Within the framework of a staff leasing arrangement, this person will take care of the payroll processing on site or support your payroll officers as required.
No question is too complex for us. We are happy to support you with any questions on individual issues, for example on your employer obligations in the areas of taxes and social insurance in the frame of home office in an international context or in the revision of your regulations.
If you use Abacus business software for payroll accounting, we can show you how to make your payroll processing more efficient, for example with suitable wage types, tables, automations or interfaces.
Our experts are personally available to you for all of the above-mentioned topics. We look forward to hearing from you.
Leader Payroll Services West, PwC Switzerland
Tel: +41 58 792 92 47