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Old 08.01.2008, 06:43
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Re: Postdoc tax question

To answer Rodi's question, yes, the Marie Curie allowance will also have to pay the employer contribution if you have an Intra European Fellowship. This is 100% certain unless you manage to convince your uni to pay these costs from other sources, like their own budget, which is not likely. (You can argue they will get money themselves with the overhead costs, but they cannot use that to pay your pension, so you could only convince them to fund it indirectly, if that).

I am in Bern and all our allowances are taxed, the mobility, the travel, the career allowance, and all at shocking rates (between 30-80% depending on how many allowances are paid together in one month; in other words, make sure they do not pay travel+career in one month!). I have not been able to find out if other EIF fellows (or IEF as they are now called?) in other cities are treated differently.

For the record, it is the university which has some decision power, as they will assess whether they want to risk paying your tax should they make a wrong guess, which seems the case with all quellensteuered employees (taxed at source this means). So ours was conservative and decided to assume the worst. After a long fight, we were unable to change this policy and are still paying taxes out of our ears on these allowances. If other kantons have treated some of you better, could you please post, as that would be valuable info.

See this very good document:

From the total LIVING allowance paid by the Commission, the social security contributions of the host institution (employer contribution) are deducted to obtain the gross salary of the fellow. From this, tax and social security contributions of the fellow are deducted to obtain the net salary of the fellow.

LIVING allowance paid by the Commission
(-) employers social security contribution
=> gross salary of the fellow
(-) tax and employees social security contribution
=> net salary of the fellow
In Swiss situations, this means the gross salary is called: brutto; no tax will deducted from this initially, the tax will be deducted from your living allowance minus employer contributions (arbeitsgeberbeitrage).

To give an example of what would happen to an average IEF salary:
  • 47.000 Euros salary times the 1.24 factor for CH = ~58300 Euros
  • 58300 Euros times the exchange rate of ~1.63 = ~95000 CHF; make this 90k as universities will start with a conservative exchange rate
  • so 90000 minus employer pension contributions, accident, and social insuranc (unempl.) of 13.5% = 79500 this your brutto salary per year
  • divide by 13 months to get at monthly income before tax = 6100
  • add mobility allowance of ~950 CHF for single person, for the normal 12 months
  • substract the tax on the final total of 7050,
5100 = final monthly income

So you started with ~95000 a year for a living allowance, and ~11500 for a mobility allowance, this translates to roughly 12*5100 (+ 3.500 netto) for the 13th month = 64700. Effectively, this means your total tax and social contributions equal about 40% in 'taxes'. In theory, the employer pension contribution should go to your pension, so check the overview you will get from your pension fund to make sure that the uni paid this in!

Last edited by muze7; 11.01.2008 at 20:06. Reason: Made it into a mini guide for taxation for MC fellows in Switzerland
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