Aug 7

AHV Contribution Obligations and Registration as a Self-Employed Music Teacher

Updated: Aug 8

Freelance music teachers often wonder about their AHV contribution obligations and how they apply. To provide guidance, we’ve written this brief blog article that covers the key answers on the topic. Read on now.

AHV, Taxes, Music Teacher — Freelancing as a Music Teacher – Here’s How to Do It Right!

How is AHV contribution obligation regulated in Switzerland?

The timing and amount of contributions are regulated differently depending on the work situation. The Old Age and Survivors Insurance (AHV), Disability Insurance (IV), and Income Compensation Scheme (EO) distinguish between employed and self-employed individuals.

Employed individuals are those who are hired by an employer and receive a salary. This category generally also includes agents and freelance workers.

Self-employed individuals are those who:

Work under their own name and on their own account, and
Are in an independent position and bear their own economic risk.

What applies to self-employed individuals?

Self-employed individuals pay contributions based on the level of their earned income. They must register with a compensation fund (overview of cantonal compensation funds). The fund will assess whether the criteria for self-employment are met.

An individual recognized as self-employed in one activity might be considered employed in another activity. What matters are the actual economic circumstances - regardless of what is stated in a contract. To process the registration, the compensation fund requires proof of self-employment. Therefore, the registration is done retroactively.

Who is considered self-employed?

A person is considered self-employed if they:

Operate under a business name (e.g., registered in the commercial register, listed in address and telephone directories, use their own stationery and promotional material, or hold a license for their profession). Additionally, they issue invoices in their own name and handle VAT (although music instruction is exempt from VAT).
Bear their own economic risk. This means making long-term investments (e.g., setting up a studio), covering their own operational costs (e.g., purchasing instruments and teaching materials), or paying rent for their teaching space.
Have the freedom to organize their business. This includes setting their own teaching hours, managing their work organization, and choosing which students to teach.
Work for multiple clients (e.g., music students or music schools). Working for only one client (e.g., one music student or one music school) usually qualifies as employed activity. You are also considered self-employed if you employ other teachers.

Do I need to pay contributions to AHV, IV, and EO as a self-employed person?

Yes. Anyone who is "gainfully" employed in Switzerland must contribute to the AHV (Old Age and Survivors Insurance), IV (Disability Insurance), and EO (Income Compensation Scheme). However, a self-employed person is not insured against unemployment and is not mandatorily covered for accidents.

What contributions must I make as a self-employed person?

Self-employed individuals must pay contributions to AHV/IV/EO social insurance institutions, as well as family allowances and administrative costs. The amount of contributions depends on the relevant compensation fund.

The applicable contribution rate is determined by the contribution scale (see the leaflet on contributions to AHV, IV, and EO).

If self-employed individuals earn no more than CHF 9,600 and receive a gross salary of at least CHF 4,747 as employees in the same calendar year, they can report this to the compensation fund. The fund will then reduce the contributions for self-employment.

An income of no more than CHF 2,300 in a calendar year from secondary self-employment is only subject to contributions upon request, provided at least one of the following conditions is met:
- Simultaneous employment as an employee
- Receipt of unemployment benefits
- Married or in a registered partnership and managing the family household