Changes in Salary Statements from 1 January 2016

At the beginning of the year it will be that time again: salary statements must be issued. In the future, for salary payments from 1 January 2016, a few changes have to be taken into account when preparing the salary statements. These relate in particular to private shares of company cars / compensation for commuting, as well as the contributions of the employer for vocational and further education costs. In addition, there are new declaration duties in respect of employee participation and so-called expats.

Since January 1, 2016, the new version of the "Guidelines for Completing the Salary or Pension Statement (form 11)", published by the Swiss Tax Conference (SSK) and the Federal Tax Administration (FTA), applies. Apart from various editorial adjustments, the new guidelines have also resulted in substantive changes which have a direct effect on taxation or impose new requirements on the declaration obligations of the employer.

Changes for private shares of company cars/compensation for commuting
As a result of the implementation of the "Financing and Expansion of Railway Infrastructure (FABI)" submission, the deduction for the necessary costs for journeys between the place of residence and the workplace was limited to max. CHF 3'000. This also affects employees with company cars. Although the FABI set-off is usually carried out in the employee's private tax declaration, certificates from the employer in the wage statement are nevertheless required in the following cases:

To date, if the employer reimbursed the full cost of the commute (by public transport or by private vehicle), they only had to cross box "F" (free transport between place of residence and place of work) on of the wage statement because the costs were deductible at the same rate. However, the limitation of the travel expense deduction to CHF 3,000 now means that it no longer necessarily leads to such a "zero-sum game", if the employer, e.g. reimburses the cost of the journey by private car at CHF 0.70 per kilometre. Therefore, the full amount of this remuneration now has to be certified in para. 2.3 as a fringe benefit liable to tax and social security contributions.

Since 1 January 2016 in the case of employees with company cars, the (theoretical) compensation for commuting (CHF 0.70 / km) has been offset by the FABI commuter lump sum in the private tax declaration. However, employees working in the field often travel directly from their place of residence to customers. This does not qualify as a commute to work, which is why compensation for commuting should be reduced by such days. Correspondingly, point 70 of the guidelines sets out the following: "If the employee has a company car and works full or part-time in the field (e.g. sales staff, customer advisors, fitters, during regular work on construction sites and projects), the employer must certify the percentage of time spent in the field under para. 15".

As of 1 January, in the case of work in the field of 40%, the additional value of the taxable fringe benefit from the commute shall be calculated e.g. (assuming a daily commute of 25 km there and back and 240 working days) as follows:

Contributions of the employer for vocational and further education costs
According to point 61 of the guidelines, the costs for the vocational and further education of the employee are to be entered in para. 13.3 of the salary statement (contributions for further education) only if the employer makes the payment to the employee or if the invoices issued to the employee are reimbursed. For employers, it is therefore generally advisable to pay education and training costs directly to the respective educational institutions and to always have the institutions issue corresponding invoices in their name.

Additional declaration duties in respect of employee participation and expats
Since the entry into force of the Ordinance on the Certificate Obligations for Employee Participation (Employee Participation Ordinance, MBV) as of 1 January 2013 and the corresponding Circular No. 37 "Taxation of Employee Participations" from the FTA of 22 July 2013, the employer has increased declaration obligations regarding employee participation. These are also now included in point 29 of the guidelines to the salary statement.

On January 1, 2016, the updated version of the Ordinance on the Deduction of Special Occupational Costs of Expatriates entered into force with the direct federal tax (Expatriates Ordinance, ExpaV). It describes the qualification of expatriates or specialists and the tax-deductible expatriate costs. According to point 26 of the guidelines the expatriate lump sum paid by the employer is to be added in para. 2.3 of the salary statement as a fringe benefit to the gross wage. On the other hand, the compensation paid by the employer for the special (deductible) professional expenses of expatriates, are to be declared with the expenses under paras. 13.1.2 and 15 respectively.

Authors: