What is the difference between the first pillar (AVS) and the second pillar (LPP)?

The first pillar (AVS) is compulsory public pension financed by wage contributions (5.3% employee + 5.3% employer). It guarantees a basic income to those who have reached the legal age and accumulated years of contributions. The second pillar (LPP) is occupational pension managed by the company or by collective bodies, where the employer pays an additional variable contribution (7-18% of the salary coordinated according to age). In Nidvaldo, as in the other cantons, both work together to secure retirement income and ensure economic security.

What are supplementary benefits and who is entitled to them?

The supplementary benefits (PC) are a cantonal subsidy that complements the AVS income for those who do not reach the locally established minimum living allowance. To access, you must have a low AVS annuity and limited assets, according to the criteria defined by the Nidvaldo canton. It is not an automatic right, but conditional on your economic situation. Each canton has its own income and wealth limits, so the criteria and amounts vary significantly from place to place.

How to fill contribution gaps before retirement?

Contribution gaps are filled by making voluntary contributions to the cantonal compensation fund of your canton. This is possible until the legal retirement age is reached. The cashier will inform you about the costs and benefits of this choice when consulting the AVS statement. In many cases, the payment of missing years can significantly increase your future income, making the payment financially convenient.

Can I defer retirement beyond the legal age?

Yes, you can defer your AVS annuity claim until you are 70 years old. Each year of deferral increases the annual annuity by about 5.2%. On the contrary, you can also anticipate retirement before the legal age, but in that case the pension will be reduced. The choice depends on your personal situation, your economic needs and your life plans. The cantonal clearinghouse will provide you with accurate simulations.

What documents are needed to apply for complementary services in Nidvaldo?

You will need to provide: declaration of current income (including AVS income), documentation of assets (current accounts, savings, real estate), certification of monthly rent or housing costs, any recurring medical expenses, and sick pay premiums. The cantonal social welfare office or the Nidvaldo Compensation Fund will provide you with the complete list of the necessary forms. It is advisable to contact them directly for specific guidance on the procedure and required documents.

AVS and complementary services in Nidvaldo: practical guide (cross-border guide)

Di Laura Bianchi · Published on 23 August 2026

Office workspace with AVS pension calculator documents and retirement planning materials in Switzerland

How the first pillar of social security works in the canton of Nidvaldo: calculation of AVS annuity, contribution gaps and access to supplementary benefits.

Context

In a nutshell

AVS is the first pillar of Swiss social security, financed by contributions on salary equal to 5.3% for the employee
The cantonal compensation fund manages calculations, recording and payment of annuities
Complementary services fill the gap for those who do not reach the vital minimum

Key facts

What: First Pillar of Social Security (Old Age and Survivors Insurance)
Where: Administered by cantonal clearing house in each canton
Who: All residents in Switzerland from the first day of work
Amount of contributions: 5.3% employee + 5.3% employer (10.6% total)
Calculation: Based on years of accumulated contributions and average recorded wages

Basic pension in Switzerland is based on three pillars. The first, the AVS (Old Age, Survivors and Disability Insurance), is the foundation of retirement security. In the canton of Nidvaldo, as in the other Swiss cantons, the management of these contributions and the calculation of the annuity are entrusted to the cantonal compensation fund. This public body administers residents' insurance policies and coordinates payments with the federal administration.

The contributions for the AVS amount to 5.3% of the gross salary for the employee, while the employer pays an additional 5.3%, for a total of 10.6%. These funds are not withheld as tax, but as a mandatory insurance share. Every person residing in Switzerland,

Operational details

How the first pillar works in detail

The first pillar of Swiss social security is not a single individual fund, but a solidarity-based system of redistribution. The contributions paid by current workers immediately finance the pensions of contemporary pensioners. This means that you do not accumulate 'your fund' in a dedicated account, but participate in a collective system where the young and employed fund the elderly and retirees. The cantonal compensation fund acts as an intermediary between the sides and the beneficiaries, tracing each contribution and adding up the years of insurance.

The calculation of the annuity follows standardized procedures at the federal level, but is managed by the competent cantonal compensation fund. Once you reach the legal retirement age, the local authority extracts your entire contribution history from the federal system and estimates the annual amount. If gaps have remained over the years (years without contributions), the pension is reduced proportionally — typically by about 1/44th for each missing year (the exact figures are recalculated every year by UFAS/BSV, the Federal Office of Social Security).

The Role of Complementary Performance

Complementary performance (PC) represents the safety net for low annuities. If the AVS income is not sufficient to cover the costs of accommodation, food, health and essential needs according to the cantonal costs, the difference is compensated by

Useful planning tools

To estimate your pension strategy, use the pension planner and the pillar 3 simulator.

Key points

Procedure: How to Access AVS Pensions and Complementary Benefits

Accessing an AVS pension is a process that combines automation and active control. You do not need to submit a new application from scratch when reaching the statutory retirement age: the cantonal compensation fund checks your contributory account in the federal registers and, if the situation is complete, proceeds to the first payment. However, it is essential to verify in advance that your AVS account statement is correct, as uncorrected errors before retirement become permanent.

Operational Steps

1. Request an AVS account statement. You can do this at the Nidvaldo cantonal compensation fund or through the online portal of your bank (many Swiss banks offer access to AVS statements via eBanking). This document lists all insured salaries year by year and the years of contribution registered from the first day of work. If years are missing, the fund will inform you of the gaps and their impact on future pensions.

2. Carefully check the statement. If you find errors - unregistered salaries for years worked, forgotten employment periods, or incorrect personal data - report them to the cantonal compensation fund within the specified deadlines. Correcting errors before retirement is crucial, as they directly affect the pension amount. Each missed year reduces the pension by approximately 2.3% (1/44).

3. Evaluate voluntary contributions. If you have significant contributory gaps, you can pay additional contributions in the years preceding retirement. The fund will consult with you on costs and benefits of this path, enabling you to make an informed decision. Some choose to invest in missing years if the pension turns out to be particularly low.

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Frequently Asked Questions

What is the difference between the first pillar (AVS) and the second pillar (LPP)?: The first pillar (AVS) is compulsory public pension financed by wage contributions (5.3% employee + 5.3% employer). It guarantees a basic income to those who have reached the legal age and accumulated years of contributions. The second pillar (LPP) is occupational pension managed by the company or by collective bodies, where the employer pays an additional variable contribution (7-18% of the salary coordinated according to age). In Nidvaldo, as in the other cantons, both work together to secure
What are supplementary benefits and who is entitled to them?: The supplementary benefits (PC) are a cantonal subsidy that complements the AVS income for those who do not reach the locally established minimum living allowance. To access, you must have a low AVS annuity and limited assets, according to the criteria defined by the Nidvaldo canton. It is not an automatic right, but conditional on your economic situation. Each canton has its own income and wealth limits, so the criteria and amounts vary significantly from place to place.
How to fill contribution gaps before retirement?: Contribution gaps are filled by making voluntary contributions to the cantonal compensation fund of your canton. This is possible until the legal retirement age is reached. The cashier will inform you about the costs and benefits of this choice when consulting the AVS statement. In many cases, the payment of missing years can significantly increase your future income, making the payment financially convenient.
Can I defer retirement beyond the legal age?: Yes, you can defer your AVS annuity claim until you are 70 years old. Each year of deferral increases the annual annuity by about 5.2%. On the contrary, you can also anticipate retirement before the legal age, but in that case the pension will be reduced. The choice depends on your personal situation, your economic needs and your life plans. The cantonal clearinghouse will provide you with accurate simulations.
What documents are needed to apply for complementary services in Nidvaldo?: You will need to provide: declaration of current income (including AVS income), documentation of assets (current accounts, savings, real estate), certification of monthly rent or housing costs, any recurring medical expenses, and sick pay premiums. The cantonal social welfare office or the Nidvaldo Compensation Fund will provide you with the complete list of the necessary forms. It is advisable to contact them directly for specific guidance on the procedure and required documents.