Why the 13th salary requires dedicated accounting planning
In Switzerland, the 13th salary is not mandated by law, but it is an extremely common component of remuneration: it appears in the employment contract, staff regulations, or collective labor agreement (CLA). For the employer, it represents an additional burden of approximately 8.3% of annual payroll costs, with implications for liquidity, accruals, social contributions, and withholding tax.
Company bonuses — which may be tied to performance, achievement of targets, or discretionary criteria — follow similar but not identical logic. The main difference concerns the point at which the payment obligation becomes certain and measurable, and therefore when the cost must be recorded in the accounts and subject to taxation.
This guide explains how to manage accruals, tax timing, and accounting entries for the 13th salary and bonuses in a Swiss SME context, with reference to the accrual principle and the most established practices among fiduciaries and auditors.
Contractual basis: when the payment obligation arises
Before accounting for these items, it is necessary to verify whether the employee has acquired a right to the 13th salary or bonus:
13th salary — established right
If provided for in the employment contract, staff regulations, or an applicable CLA, the 13th salary constitutes an integral part of annual remuneration. The employee is entitled to payment even in the event of resignation or termination, proportionally to the months worked during the year (unless more favorable clauses apply).
The standard calculation is one month of gross salary (100% of the base monthly salary), normally paid in November or December. Some companies distribute the thirteenth month in two semi-annual installments.
Bonus — variable obligation
A contractual bonus with objective and measurable criteria (e.g., achievement of a revenue target) generates a payment obligation as soon as the criteria are met. A purely discretionary bonus, without contractual obligation, does not require accrual until management formalizes the amount to be paid.
Periodic gratuities repeated over the years may become an acquired right by custom, even without an explicit written clause — a risk that SMEs should monitor carefully.
Comparison: 13th salary, contractual bonus, and discretionary gratuity
The three forms of variable remuneration differ in certainty of obligation, accounting timing, and tax treatment:
| Criterion | 13th salary | Contractual bonus | Discretionary gratuity |
|---|---|---|---|
| Legal basis | Contract, regulations, or CLA | Contract with defined criteria | Employer decision |
| Certainty of obligation | High — accrues month by month | Medium — upon achievement of targets | Low — until formal decision |
| Monthly accrual | Yes — 1/12 of annual cost | Yes, if the amount can be estimated with sufficient reliability | No — cost at time of decision |
| Tax timing (employee) | Year of receipt (salary certificate) | Year of receipt | Year of receipt |
| AHV/IV/EO contributions | Due upon payment | Due upon payment | Due upon payment |
| BVG coordination | Contributes to coordinated annual salary | Contributes if paid regularly | Case-by-case assessment |
| Withholding tax | Withheld at time of payment | Withheld at time of payment | Withheld at time of payment |
| Early departure | Pro rata temporis for the current year | According to contractual clauses | Generally excluded |
Monthly accruals: the accrual principle
Under Swiss accounting standards (Code of Obligations, Art. 957 et seq., and FER/MOR practice), personnel costs must be allocated to the fiscal year in which the work was performed. Since the 13th salary remunerates the entire working year, the related obligation must be spread over the twelve months of the accounting period, regardless of the month of payment.
The most common formula provides for an accrual equal to 1/12 of the gross cost of the 13th salary for each month of service rendered. If an employee's monthly salary amounts to CHF 6,000 and the 13th equals one full month, the company accrues CHF 500 per month (CHF 6,000 ÷ 12). At year-end, the cumulative accrual corresponds to the total cost to be paid.
Additional costs to include in the accrual
For a faithful representation of personnel costs, many companies also accrue the estimated share of employer social contributions (AHV/IV/EO, ALV, BVG, UVG) on the 13th salary. Alternatively, contributions may be recorded separately at the time of actual payment. The chosen approach must be applied consistently and documented in the internal accounting policy.
Accounting: typical entries
Below are the accounting entries most commonly used by Swiss SMEs. Account numbers are indicative and should be adapted to the company's chart of accounts:
1. Monthly accrual of the 13th salary
At month-end, for each employee entitled to the thirteenth month:
- Debit: 6200 — Salaries and allowances (personnel cost)
- Credit: 2290 — Accrual for 13th salary (liability)
The amount corresponds to 1/12 of the gross monthly salary used as the basis for the 13th.
2. Payment of the 13th salary (e.g., December)
At the time of payment to the employee:
- Debit: 2290 — Accrual for 13th salary
- Credit: 1020 — Bank (net amount to employee)
- Credit: 2270 — AHV/IV/EO, BVG, UVG liabilities (employee and employer shares)
- Credit: 2271 — Withholding tax (if applicable)
3. Contractual bonus with certain obligation at year-end
If in December the bonus amount can be determined with reasonable certainty:
- Debit: 6200 — Salaries and allowances
- Credit: 2291 — Bonus accrual (liability)
Upon actual payment (e.g., January of the following year): reversal of the accrual and recording of the payment with social and tax withholdings, analogous to the 13th salary.
4. Employee departure mid-year
If an employee leaves the company in June after six months of service, they are entitled to 6/12 of the 13th salary. The cumulative accrual (CHF 3,000 in our example) covers the cost. Any differences between the accrual and the amount owed must be adjusted in the final settlement.
Tax timing: when tax liability arises
In Switzerland, for employees subject to withholding tax (Art. 83 et seq. DBG), remuneration — including the 13th salary and bonuses — is taxed at the time it is paid, not when the company accrues the cost in the accounts. The monthly or quarterly withholding tax declaration must include the gross amount of the thirteenth month or bonus, with application of the applicable rate for the employee's canton and municipality of residence or employment.
For employees with a C permit or under the ordinary assessment procedure, the 13th salary and bonuses are included in the annual salary certificate (Form 11 or cantonal equivalent) and contribute to taxable income in the year of receipt. A payment in January of the following year falls within the income of that year, even if the accounting accrual was recorded in the prior fiscal year.
At the corporate level, accruals for the 13th salary and contractual bonuses are tax-deductible in the fiscal year in which they are recorded, provided the payment obligation is legally established and the amount can be determined with sufficient precision. Purely discretionary gratuities not yet decided do not generate a deduction until the actual obligation arises.
Impact on the salary certificate
The 13th salary must be indicated on the salary certificate in the actual salary line or, if paid separately, in the supplementary benefits section. Bonuses must be classified as salary if linked to the employment relationship. Incorrect classification may lead to challenges from the tax authority or the Federal Tax Administration (FTA).
Withholding tax on extraordinary payments
Some cantons provide specific rates or special procedures for one-time payments such as the 13th salary. Verify the latest cantonal guidelines and, if in doubt, consult the cantonal withholding tax office before payment.
Year-end closing and operational checklist
Before the annual closing, the accounting manager or fiduciary should verify the following points:
- 1.Compare the cumulative accrual as of 31 December with the gross 13th salary owed to each active employee, adjusting for any discrepancies (new hires, departures, salary changes).
- 2.Calculate the pro rata 13th salary for employees who left during the year and ensure the amount is included in the final settlement of the employment relationship.
- 3.Accrue contractual bonuses whose amount can be determined with reasonable certainty before closing; document the calculation basis for potential audits.
- 4.Plan the liquidity required for payment of the 13th salary (gross cost + employer contributions), normally between November and January.
- 5.Prepare withholding tax declarations and salary certificates correctly including the 13th salary and bonuses, distinguishing them from exempt allowances (e.g., documented expense reimbursements).
- 6.Inform employees of the amount and payment date of the thirteenth month, preferably at least one month in advance, to support their financial planning.
Automate with Accountex
Accounting software such as Accountex allows you to configure recurring accruals for the 13th salary, monitor personnel liabilities in real time, and generate year-end closing entries in just a few clicks. Integration with payroll management simplifies the calculation of social contributions and the preparation of salary certificates, reducing the risk of manual errors during the most critical periods of the year.
Social contributions on the 13th salary and bonuses
The 13th salary and bonuses linked to the employment relationship are considered salary under the Federal Act on Old-Age and Survivors' Insurance (AHV) and contribute to the basis for social contributions:
AHV/IV/EO contributions are calculated on the full salary, with no maximum cap. For ALV and accident insurance (LAA/UVG), a maximum insurable salary of CHF 148,200 applies in 2026 (subject to updates). For BVG, it is necessary to verify whether the determining annual salary, including the 13th salary and recurring bonuses, exceeds the maximum insurable amount provided by law and the pension fund regulations.