13th AVS Pension: Here's How It Will Be Funded (cross-border guide)

Di Valerie Linc · Published on · Updated on

The Federal Council proposes a 0.5% increase in social security contributions from 2026. A direct impact on cross-border workers' payslips: what's changing.

Contesto

TL;DR - Swiss 13th AVS pension funded by 0.5% social contribution increase - Employers and employees split 0.25% deduction each - Effective January 1, 2026, impacting 70,000+ cross-border workers - Annual cost of 13th AVS estimated at 4.2 billion CHF ## Key facts - Total contribution: Increase of 0.5 percentage points, from 10.6% to 11.1% - Employee increase: 0.25 percentage points, from 5.3% to 5.55% - Effective date: January 1, 2026 - Annual cost: Approximately 4.2 billion CHF - Impacted workers: Over 70,000 cross-border workers in Ticino - Monthly deduction: 12.50 CHF for a 5,000 CHF gross salary - Annual deduction: 150 CHF for a 5,000 CHF gross salary The vote on March 3rd was clear. Now, the bill for the 13th AVS pension payment is arriving. The Federal Council has officially put its cards on the table, outlining the path to finance the extra monthly pension: a "mixed financing" model that will directly affect the paychecks of over 70,000 cross-border workers in Ticino. The core of the proposal, sent for consultation, is an increase in social security contributions of 0.5 percentage points, effective from January 1, 2026. This increase will be split equally between employers and employees. In practice, this means an additional deduction of 0.25% from the gross salary of every worker in Switzerland, including frontalieri. The government has thus chosen the path of social contributions, at least for now, setting aside the more controversial option of a VAT increase, which would have impacted consumption. The decision aims to find a balance, but the impact on net salaries is now a certainty. The annual cost of the 13th AVS is estimated at around 4.2 billion francs, a figure that requires stable and secure funding.

Dettagli operativi

Let's get into the specifics. What does this 0.25% deduction mean for a frontaliere's payslip? The OASI/DI/IC (AVS/AI/IPG) contribution rate will rise from the current 10.6% to 11.1%. For the employee, the rate will go from 5.3% to 5.55%. On a gross monthly salary of 5,000 CHF, this translates to an extra monthly deduction of 12.50 CHF, or 150 CHF per year. While it may not seem like a huge amount on its own, it adds to the complex calculation of the net salary, which is already subject to withholding tax and other social security deductions. ## The Political Debate and the VAT Hypothesis The Federal Council's choice was not a given. The debate also included the possibility of raising the Value Added Tax (VAT). This option was strongly opposed by unions and consumer associations, as it would have disproportionately affected lower-income households. For now, the government has stated that the federal budget can absorb its share of the financing without resorting to a VAT hike. However, this door is not permanently closed. The political debate in the coming months will be crucial to see if this solution becomes final or if further adjustments will be necessary in the future. 📊 Key Data: - Total contribution increase: +0.5% (from 10.6% to 11.1%) - Increase for the employee: +0.25% (from 5.3% to 5.55%) - Effective date: January 1, 2026 - Annual cost of 13th AVS: approx. 4.2 billion CHF

Punti chiave

The decision is made, and the timeline is set for 2026. For cross-border workers, this means a slight but tangible reduction in their net monthly income. It is a direct consequence of a democratic choice that aims to strengthen the Swiss pension system, from which frontalieri themselves will benefit in the future. The measure reinforces the principle of solidarity that underpins the AVS, but it also requires careful financial planning. ## What to do now? While the change is still more than a year away, it's wise to start understanding its effects. The primary impact will be on the final net amount received each month. Knowing in advance how your salary will change allows you to adjust your family budget without surprises. This is especially important in a context of a strong franc and fluctuating exchange rates. 💡 Practical Tip: Don't wait for 2026. To get a clear idea of how this new deduction will affect your salary, you can use online simulation tools. A good starting point is the net salary calculator, which allows you to enter your gross salary and see a precise estimate of your net pay, taking into account future contribution changes. (Source: RSI, March 5, 2024)

Punti chiave

[{"q":"How much will it increase the restraint for the thirteenth AVS for frontier workers in Switzerland from 2026?","a":"The deduction will increase by 0.25% on gross wage, bringing the worker's share from 5.3% to 5.55%. For example, on a monthly gross salary of 5'000 CHF, the increase will be 12,50 CHF per month (150 CHF per year)."},{"q":"How will the increase in social contributions of 0.5% be distributed between employer and employee starting from 2026?","a":"The 0.5% increase in social security contributions will be divided equally between employer and employee, with an increase of 0.25% for each."},{"q":"Will cross-border commuters in Switzerland have to pay more for the thirteenth AHV even if they live in Italy?","a":"Yes, the 0.25% deduction on cross-border workers' paychecks will be applied regardless of their residence in Italy. The AHV rate will increase from 11.1% to 11.35%, with an annual impact of around CHF 150 on a gross salary of CHF 5,000."},{"q":"What changes for cross-border commuters' pensions after the increase in AHV contributions?","a":"The increase in contributions will finance the thirteenth AHV, guaranteeing an extra annual payment to pensioners. Cross-border commuters will now contribute more and will acquire higher pension rights in accordance with the Swiss AHV principle of solidarity."},{"q":"How can I calculate the exact impact of the new deduction on my cross-border commuter salary?","a":"You can use online tools such as the Swiss Confederation net salary calculator. Enter your gross salary and the effective date (2026) to get an accurate simulation of the net, also considering the increase in AHV contributions."}]

Frequently Asked Questions
How much will it increase the restraint for the thirteenth AVS for frontier workers in Switzerland from 2026?
The deduction will increase by 0.25% on gross wage, bringing the worker's share from 5.3% to 5.55%. For example, on a monthly gross salary of 5'000 CHF, the increase will be 12,50 CHF per month (150 CHF per year).
How will the increase in social contributions of 0.5% be distributed between employer and employee starting from 2026?
The 0.5% increase in social security contributions will be divided equally between employer and employee, with an increase of 0.25% for each.
Will cross-border commuters in Switzerland have to pay more for the thirteenth AHV even if they live in Italy?
Yes, the 0.25% deduction on cross-border workers' paychecks will be applied regardless of their residence in Italy. The AHV rate will increase from 11.1% to 11.35%, with an annual impact of around CHF 150 on a gross salary of CHF 5,000.
What changes for cross-border commuters' pensions after the increase in AHV contributions?
The increase in contributions will finance the thirteenth AHV, guaranteeing an extra annual payment to pensioners. Cross-border commuters will now contribute more and will acquire higher pension rights in accordance with the Swiss AHV principle of solidarity.
How can I calculate the exact impact of the new deduction on my cross-border commuter salary?
You can use online tools such as the Swiss Confederation net salary calculator. Enter your gross salary and the effective date (2026) to get an accurate simulation of the net, also considering the increase in AHV contributions.

Related articles