AHV Contributions for the Self-Employed: How They Are Calculated

Unlike employees, who split AHV contributions with their employer, self-employed people pay the full contribution themselves — calculated on their net business income.

The basis

Your AHV contribution is based on your net income from self-employment, after business expenses. The compensation fund sets the amount based on your accounts and an assessment of your situation.

Net income means your revenue minus the business expenses you can legitimately deduct. That figure, not your turnover, is what the contribution is calculated on.

In your first years, the fund works with estimates, then reconciles against your actual accounts once they are available. Expect adjustments.

You report your income to the compensation fund each year so they can set the contribution. Late or missing reporting leads to estimated, often higher, assessments.

• Based on net income (after expenses).
• Assessed by the compensation fund.
• Paid directly by you — no employer share.

The rate

The rate is progressive: lower incomes pay a lower percentage, higher incomes pay more, within a defined range. There is also a minimum annual contribution even in a low-income year.

The scale rises from a low starting percentage for small incomes to a maximum for high earners. It is designed to be fair across income levels.

Even in a year with little or no income, a minimum contribution applies. This keeps your insurance record continuous.

The compensation fund applies the rate for the year to your assessed net income. You can ask them to explain the calculation if it is unclear.

Plan for it

Contributions are typically billed periodically or on account, with a final adjustment once your actual income is known. Be ready for a balancing payment.

If your income grows sharply, your contributions grow with it. Revisit your reserve percentage whenever your revenue changes materially.

Keep personal drawings separate from the business so you always have enough retained to meet the contribution bills when they land.

What AHV buys you

AHV is the first pillar of the Swiss pension system, covering old age, survivors and disability. Your contributions build your entitlement to a future pension.

Consistent contributions over your working life determine your eventual pension level. Gaps in contributions reduce it, so do not skip low-income years without advice.

Alongside AHV, the same payment covers IV (disability) and EO (income compensation), which is why they are often quoted together as AHV/IV/EO.

The compensation fund keeps your individual account and can provide a statement of your entitlements. It is worth checking periodically that your record is correct.