Before making the first payroll payment, you must verify the residency status of your employees and their spouses : Check their residency permit (passport or permit).

Based on the residency status, you can determine whether withholding tax must be withheld:

• Category A (temporary): Withholding tax required.
• Category B (temporary residence permit): Withholding tax required.
• Category C (permanent residence permit): No withholding tax – normal taxation as for Swiss citizens (exception: see cross-border commuters below).
• Cross-border commuters (Category G): Withholding tax required, regardless of other categories.
• Category L (seasonal workers): Withholding tax required.

Calculate the withholding tax using the cantonal tax tables at and deduct it directly from the gross salary:

• Use the valid tax rates for the Canton of Zurich.
• Withholding tax is calculated monthly and deducted from the gross salary (calculation at the end of each month or with each payroll payment).
• Save all calculation documents for record-keeping purposes.

You must remit the withheld withholding tax to the Canton of Zurich in accordance with the specified frequency :

• Submission deadline: The withholding tax return must be submitted no later than by the 10th of the following month.
• You may submit the statement electronically or by mail.
• Late submission of the statement and payment of the invoice will be subject to a late payment surcharge or interest.

Document everything carefully:

• Copies of your employees’ residence permits.
• All pay stubs with withholding tax deductions (monthly).
• Withholding tax statements for each tax period.
• Proof of payment to the canton (receipts/payment confirmations).
• All correspondence with the tax office.

You must retain these documents for at least 10 years (statute of limitations).