2025: key changes at a glance

Financial

Customs allowance: reduction from 2025

From 1 January 2025, the allowance for duty-free imports of goods into Switzerland will be reduced. Instead of the previous CHF 300 per person per day, the limit will in future be just CHF 150 per person per day. If you go over this amount, Swiss VAT will be charged on the entire value of the goods. This change is being made by order of Parliament and the cantons. The aim is to curb shopping tourism and make the Swiss economy more competitive.

Increase in child and education allowances from 2025

From 2025, the minimum rates for child and education allowances will be increased. Child allowance will increase from CHF 200 to CHF 215 per month, while education allowance will increase from CHF 250 to CHF 268 per month. This is the first change since the Federal Act on Family Allowances entered into force in 2009. The increase enters into effect on 1 January 2025 and is intended to help parents with the maintenance and education costs for their children.

Changes to taxation of life annuities from 2025

Changes will be made to the way pillar 3b life annuities are taxed in Switzerland from 1 January 2025. The previous flat-rate system, where 40% of the annuity was taxed as income, will be replaced by a more flexible system, which will focus more on the composition of the benefits.

What is changing?

• Swiss life annuities in accordance with the Federal Law on Insurance Contracts (VVG): the profit portion (%) of the “guaranteed benefits” is determined at the time the contract is concluded and remains the same forever. The taxable portion is calculated on the basis of the technical interest rate applicable at the time the contract was concluded. This interest rate is set by FINMA. Surpluses are taxed at a fixed rate of 70%.
• Foreign life annuities and Swiss life annuities in accordance with the Swiss Code of Obligations: the profit portion (%) is recalculated annually in line with the yield on Swiss Confederation bonds. People subject to tax must determine the profit portion themselves.
• Existing contracts: the new rules also apply retroactively to existing life annuities.

^{(Source: TaxInfo, Canton of Bern)}

Changes to VAT

Following the partial revision of the VAT Act and the associated VAT ordinances, new rules will come into force from 2025. The changes will take account of digitalisation as well as political, economic and social changes.

The key changes

• Online shipping platforms: mail-order platforms must now declare and tax all deliveries of goods processed via their platform. Foreign tour operators will be exempt from tax if they organise trips to Switzerland.
• Monthly hygiene products: tampons, sanitary pads and similar products will in future be subject to the reduced VAT rate and will no longer be taxed as luxury goods.
• Coordinated medical treatments and cultural events: healthcare services and actively participating in cultural events will in future be exempt from VAT.

^{(Source: Federal Department of Finance)}

Changes to international inheritance law from 2025

New rules governing international inheritance law will apply in Switzerland from 1 January 2025. These relate in particular to:

• Responsibilities for cross-border inheritance cases: people with more than one nationality can now determine which of their home countries should be responsible for settling their estate.
• Choice of law: Swiss citizens who last resided in Switzerland and who also have foreign citizenship will be able to choose to apply the inheritance law of their other home country. Foreign testators resident in Switzerland already had this opportunity previously.
  

However, it remains important to note: Swiss citizens with two or more nationalities must continue to comply with the rules governing statutory shares. The new provisions offer more options for structuring international inheritance matters. This applies both to estate assets in an international context (located in different countries) and to testators with more than one nationality. The aim of the revision is to adapt Swiss inheritance regulations in line with the country’s increasingly international population, provide options for structuring inheritances, improve planning security and minimise conflicts between different international authorities.

Insurance

Increase in health insurance premiums from 2025

From 1 January 2025, basic insurance premiums in Switzerland will increase by 6% on average. Premium adjustments may vary from canton to canton.

Reasons for the increase

• Rising healthcare costs: higher spending on medical treatments and products, influenced by inflation and economic trends.
• Demographic change: an older population on average leads to an increased need for medical care.
  

Opportunities to reduce premium costs

• Switching model or provider: alternative insurance models or a change of provider can reduce monthly costs.
• Increase in deductible: a higher deductible can reduce premium costs.

Tip: compare offers early in order to find the right model for your individual needs and avoid unnecessary costs. Here you can find out everything you need to know about health insurance in Switzerland.

Retirement provisions

Increase in AHV/AVS pensions and changes to AHV/AVS from 2025

As of 1 January 2025, AHV/IV pensions will be increased by 2.9% to take account of current price and salary developments. The minimum AHV/IV pension will therefore rise from CHF 1225 to CHF 1260 per month and the maximum pension will rise from CHF 2450 to CHF 2520. This increase is an important step in preserving pensioners’ purchasing power and offsetting the rising cost of living.

AHV/AVS 21 reform: change in reference age for women

The AHV/AVS 21 reform, which entered into force in 2024, will gradually raise the reference age for women. The following rules will apply from 2025: the reference age for women born in 1961 is being raised by three months. For example, a woman born in March 1961 now has to work for another three months, i.e. until the end of June, before she can take normal retirement. Further increases will be made in the following years:

• 2026: women born in 1962 can retire at the age of 64 and 6 months.
• 2027: women born in 1963 reach the reference age at 64 years and 9 months.
• 2028: the reference age will be 65 for all men and women born in 1964.

The AHV/AVS 21 reform provides for compensatory measures in the first pillar for women born between 1961 and 1969 (transitional generation). They will benefit from a lifelong pension supplement if they do not draw their retirement pension early or a lower reduction rate if they do draw their retirement pension early.

Higher maximum pillar 3a amounts from 2025

The maximum pillar 3a payment amounts will increase from 1 January 2025.

New maximum amounts

• People with a pension fund: the maximum amount will be increased from CHF 7056 to CHF 7258 (an increase of CHF 202 from 2024).
• People without a pension fund (e.g. self-employed people): the maximum amount will increase from CHF 35 280 to CHF 36 288, an increase of CHF 1008 compared to the previous year.

The new amounts apply from 1 January 2025.

Retroactive pillar 3a purchases possible from 2025

From 1 January 2025, people in Switzerland will be able to make retroactive payments into their pillar 3a if they have not paid the maximum amounts in previous years. The Federal Council decided on this arrangement in order to strengthen private pension provisions and allow for more flexibility in retirement provisions.

Please note: retroactive payments for the years prior to this change entering into force are not possible. The earliest possible date for a retroactive purchase will therefore be 2026 in relation to 2025.

Rules at a glance

• Amount of contribution: in addition to the regular contribution, a so-called “small contribution” pillar 3a purchase is permitted each year. For example, if you do not pay in full the maximum amount of CHF 7258 in 2025, you can make retroactive payments over the next ten years in addition to your regular pillar 3a payments.
• Retroactive payment: any shortfalls in contributions can be paid in retroactively for up to ten years.
• Conditions: the maximum annual amount must be paid in full for the corresponding year. In addition, income subject to AHV/AVS contributions must be available in both the year of purchase and the retroactive year.
• Tax deductibility: subsequent payments are fully tax deductible, as is the regular annual contribution.
  

Further impacts of changes to AHV/AVS pensions

The changes to AHV/AVS pensions will also affect occupational provisions. The following changes will enter into force as of 2025:

• Coordination offset: increase from CHF 25 725 to CHF 26 460.
• Entry threshold: change from CHF 22 050 to CHF 22 680.
• Minimum AHV/AVS contribution for people not in gainful employment and self-employed people: increase to CHF 530.
• Maximum insured salary: increase from CHF 88 200 to CHF 90 720