The salary certificate (Lohnausweis): how to complete it

The salary certificate (in German Lohnausweis) is the document with which the employer declares to the employee and the tax authority how much it paid out during the year. It is not an optional attachment: it is the basis on which the employee completes the tax return and with which the tax office checks that income is consistent. Completing it badly leads to disputes, reassessments and requests for correction.

What it is for

The employer issues one certificate for each calendar year to every person who received a salary, including for short employment relationships or those that ended during the year. The document shows the gross salary, social deductions, fringe benefits and allowances. The employee attaches it to the tax return; the tax office uses it to compare what was declared with what the employer reports.

There is a single form valid in all cantons, with numbered boxes. The logic is that every item has a precise place, so that the document is readable everywhere.

The main items

The key boxes that almost every certificate fills in are:

Gross salary: total remuneration before social deductions, including the thirteenth month’s salary, bonuses and commissions.
Benefits in kind and fringe values: for example the private use of the company car, board and lodging, which must be quantified and added to taxable income.
Employee’s social contributions: the AVS/AI/IPG/ALV (state old-age, disability, income-compensation and unemployment insurance) share withheld and the ordinary LPP (occupational pension) contributions borne by the employee, which reduce taxable income.
Net salary: the amount actually paid out after deductions.
Non-recurring benefits and special allowances, declared separately.

Expense reimbursements: the distinction that matters

One of the most frequent mistakes concerns expense reimbursements. The rule is clear:

reimbursements of actual expenses (against receipts) are not salary and do not increase taxable income;
flat-rate expense allowances normally require an expense regulation approved by the cantonal tax authority; without approval they risk being treated as salary.

The certificate provides dedicated boxes to indicate actual and flat-rate reimbursements and to signal whether an approved regulation exists. Filling them in correctly prevents a legitimate reimbursement from being reclassified as income.

Fringe benefits not to forget

Several elements slip through because they do not pass through the payslip as cash:

company car for private use: the portion of value must be indicated as income;
employee participations (shares, options): they require declaration and often a specific attachment;
employer contributions to pension schemes or insurance beyond the mandatory level;
meals, lodging or other benefits granted to the employee.

Leaving out these items does not lighten the tax burden: it simply makes them challengeable during an audit, with recoveries charged to the employee and the employer liable for the completion.

Who must issue it and when

The employer delivers the certificate once a year, typically after the close of the salary year, and also issues a copy in the event of termination of the relationship during the year. In several cantons the document is also transmitted directly to the administration. The signature or the structured issuance from software commits the employer to the accuracy of the data.

Costly mistakes

Forgetting the thirteenth month’s salary or bonuses in the gross salary.
Not quantifying the company car or other benefits in kind.
Confusing actual and flat-rate reimbursements without an approved regulation.
Reporting extraordinary LPP contributions as if they were ordinary.
Issuing the certificate with data inconsistent with the annual AVS statement.

Consistency between the salary certificate, the annual AVS salary statement and the accounts is the first thing an audit checks. Keeping the three aligned during the year is far easier than reconstructing them after the fact.

How we help you

SIH ONE’s Payroll division manages payslips, social security statements and salary certificates, ensuring the correct placement of benefits, reimbursements and fringe benefits. Entrust us with your payroll.