CONVINUS Global Mobility Alert - Week 41.2025

BEST PRACTICE In

BEST PRACTICE In Switzerland, the allowance is also subject to social security contributions. As the allowance is stated as a gross amount, the employee contributions must be deducted from this. The result is different if Mr Steiner is reimbursed for the actual moving costs. In this case, the reimbursement is exempt from tax and social security contributions. The extent to which no tax is payable on this amount depends on the country of assignment. Travel costs at the start and end of the assignment In this case, the reimbursement of travel expenses for Mr Steiner can be made tax- and social security-free. However, this must always be checked for each country of assignment or country in which social security contributions are payable. However, the travel expenses for the wife and children are subject to tax and social security contributions. If the corresponding employee costs are covered by the employer, these must be grossed-up. Bonus payment In principle, tax law stipulates that tax liability arises at the time of payment of a bonus. However, it must be checked to which period the bonus relates, and taxation usually takes place in the countries where the employee has worked. The bonus paid in April 2029 relates to the period from January to December 2028. During this period, Mr Steiner will be in Manchester until 31 October 2028. For this reason, England has the right to tax 10/12ths and Switzerland has the right to tax 2/12ths. The same distribution is applied in the area of social security. However, Mr Steiner will remain in the Swiss social security system during his assignment and will be subject to the Swiss insurance system again after his return to Switzerland. Therefore, social security contributions are payable in Switzerland. 8 convinus.com

BEST PRACTICE Conclusion These examples show that each individual remuneration component must be examined separately in terms of tax and social security obligations in the home country and the country of assignment. The place of payment does not necessarily have to be the country in which tax or social security contributions are payable for this remuneration component. As the employer is responsible for paying these contributions, it is necessary to clarify this and ensure that these contributions are declared correctly. 9 convinus.com