Whether one has lived in Switzerland their entire life or will soon be arriving for business purposes, one of the most important issues for parents is the country's current child benefits.
Provided that they live and work in Switzerland and are paid at least 587 francs per month, parents are entitled to receive these family allowances on an ongoing basis.
Even if parents are not currently working, they can still receive these allowances provided that each parent’s annual taxable income does not exceed 42,300 CHF. And understanding these benefits requires that parents keep only a few key issues in mind.
Switzerland's child benefits: What you need to know
In Switzerland, child benefits are defined as specific amounts of money received on a per child basis that are paid either by a parent's employer or directly from the government. These are further broken down into three specific types of allowances: a birth and/or adoption allowance, an education allowance, and a general child allowance.
As one might expect, the logic behind this policy is a simple one: it was created in an effort to make sure that parents have the necessary funds they need to assist in raising and caring for their children to the best of their ability.
There are currently 26 cantons in Switzerland, or "Federal States." As of 2018, there is no one rule governing child benefits by which each abides. Each canton has the ability to decide their own rate on a per child basis depending on a wide range of factors. Generally speaking, rates for these types of allowances vary based on issues like the child’s age, the total number of children in a family or household, whether that child is currently enrolled in ongoing education (once they reach a certain age) and others.
For specific child allowances, the minimum figure as of 2018 typically works out to be about 200 francs per month, per child. A family with two parents and two children would receive approximately 400 francs per month under those terms. Each canton is, however, free to regulate these benefits as they wish. Because of this, there is no "one size fits all" approach to figuring out how much money one might receive. The canton in which a parent works will ultimately determine the rates that they're able to enjoy moving forward, and whether or not those rates will eventually change.
Who is eligible to receive Switzerland’s child benefits?
On receiving these child allowances, parents are entitled to them provided that one of the parents is either A) gainfully employed, or B) is currently receiving some type of unemployment benefit. If someone's situation falls into the former category, the allowance will be paid for directly from their employer. If they are currently unemployed, the allowance will be paid for by the ALV fund (otherwise known as the unemployment fund).
When specifically talking about the education allowance, this is paid for children who are A) over the age of 16 years old, and who are B) still enrolled in the education system, or are participating in some type of educational training. Parents will continue to be eligible to receive funds under these conditions until the child either completes their education or until they turn 25; whichever comes first marks the official cutoff date for an education allowance.
If the child in question is working while studying and is earning more than 2350 CHF per year on their own, parents will also no longer be entitled to receive this benefit. As of 2018, the minimum amount for the education benefit is 250 CHF.
On the specific topic of the birth/adoption allowance, it's important to keep in mind that cantons choose on an individual basis whether or not this will actually be offered. If they do, funds are disbursed following current federal regulation. At that point, these funds would be considered "one off" payments on a per child basis.
Hiring employees in Switzerland? Rely on an experienced expansion partner
While several countries around the world offer similar aids packages, Switzerland’s child benefits program is one of the most generous. But companies that are hiring in Switzerland or should be aware of Switzerland's employee benefits to which their talent (and their children) are entitled. If you’re considering expanding your operations overseas, rely on an experienced partner to help you establish your presence quickly and compliantly.
Velocity Global’s Employer of Record solution assists businesses in widening their global footprint, and can have your business up and running overseas quickly and seamlessly—without establishing an entity. Ready to make the move? Let’s talk.