What is the coordination deduction Coordination deduction simply explained Coordination deduction part-time work

Coordination deduction for 2026 and 2027: explained simply, with a calculator

The 2026 coordination deduction amounts to CHF 26,460, whilst the BVG entry threshold is CHF 22,680.

From 1 January 2027, the coordination deduction will be CHF 26,880 and the entry threshold CHF 23,040.

The coordination deduction is the amount deducted from your annual salary before contributions to the pension fund are calculated. What remains is your insured salary, also known as your coordinated salary. This deduction ensures that there is no over-insurance within the pension system: It coordinates the 1st pillar (AHV) with the 2nd pillar (BVG), so that the portion of your salary that is already insured under the AHV is not insured again in the pension fund.

There is a downside to this: the Coordination deduction reduces the retirement pension from the pension fund. It is the same for everyone and therefore has a particularly severe impact on low earners and part-time workers.

In this article, you will find out how to calculate the coordination deduction, what your insured earnings are, and how the coordination deduction affects part-time workers.

Co-ordination deduction calculator: Enter your gross salary, your working hours and your age. The calculator will show your insured salary and the pension fund contribution, including for part-time roles and for pension funds that adjust the deduction according to working hours.

Here’s how it’s calculated: insured earnings equal annual earnings minus the coordination deduction. You can find the current figures and an example in the article below. The calculator requires JavaScript.

Table of contents

The 2026 coordination deduction is CHF 26,460

What is the coordination deduction? Insured earnings and coordinated earnings

The insured earnings are also known as the coordinated earnings. To calculate the insured earnings, you subtract the coordination deduction from your gross earnings. Contributions to the pension fund are levied only on this remaining amount, in accordance with the statutory minimum.

Example of the coordination deduction: You earn CHF 80,000 a year. The coordination deduction of CHF 26,460 is deducted from this: CHF 80,000 minus CHF 26,460 equals CHF 53,540. This CHF 53,540 is your coordinated salary. You and your employer only pay pension fund contributions on this amount, not on the full CHF 80,000.

Insured wage = Coordinates wage

Minimum and maximum insured earnings for 2026

As the coordination deduction determines the amount that is insured under your pension scheme, this is referred to as the insured salary. You will find this term on your pension scheme statement.

After reading the example above, you’re probably wondering what happens in the case of very low or very high incomes. After all, the deduction is quite substantial and drastically reduces a small income. The law sets a limit for both cases.

Minimum insured salary: CHF 3,780

The minimum coordinated wage is calculated as the difference between the maximum annual AHV pension of CHF 30,240 and the coordination deduction of CHF 26,460. It applies as soon as your annual wage exceeds the entry threshold of CHF 22,680. If the amount remaining after the deduction is less than this, your insured wage will be rounded up to this minimum amount.

Maximum insured salary: CHF 64,260

The maximum coordinated salary is calculated as the difference between the upper limit under the BVG of CHF 90,720 and the coordination deduction of CHF 26,460. Any part of the salary exceeding the upper limit is no longer covered by the statutory minimum. Many pension funds insure these amounts voluntarily under the supplementary scheme.

From 1 January 2027 The minimum insured wage is CHF 3,840 and the maximum is CHF 65,280.

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Calculate coordination deduction

How is the coordination deduction calculated?

It’s quite simple: the co-ordination deduction is calculated as 7/8 of the maximum annual AHV pension. In 2026, this amounts to CHF 30,240; 7/8 of this is CHF 26,460.

The pension fund’s other thresholds are also linked to the maximum annual AHV pension:

  • Entry threshold: 3/4 of the maximum annual AHV pension, i.e. CHF 22,680
  • Co-ordination deduction: 7/8, i.e. CHF 26,460
  • Minimum insured salary: 1/8, i.e. CHF 3,780
  • Upper limit: three times that amount, i.e. CHF 90,720

If your AHV pension increases, all four figures will therefore increase as well. You can work out your insured earnings by deducting the coordination deduction from your gross salary.

Feel free to use the coordination deduction calculator above. It also calculates figures for part-time work and shows you the savings contribution.

So now you know the simple answer to the question of how to calculate the coordination deduction.

BVG coordination deduction historical

As the BVG coordination deduction is calculated as 7/8 of the maximum annual AHV pension, it changes with every adjustment to AHV pensions. Here is the history of the coordination deduction and the entry threshold over recent years:

Co-ordination deduction and entry threshold since 2017
YearCoordination deductionEntry threshold
2027, from 1 JanuaryCHF 26,880CHF 23,040
2026CHF 26,460CHF 22,680
2025CHF 26,460CHF 22,680
2024CHF 25,725CHF 22,050
2023CHF 25,725CHF 22,050
2022CHF 25,095CHF 21,510
2021CHF 25,095CHF 21,510
2020CHF 24,885CHF 21,330
2019CHF 24,885CHF 21,330
2018CHF 24,675CHF 21,150
2017CHF 24,675CHF 21,150

How does the coordination deduction affect part-time workers?

The coordination deduction affects part-time workers particularly hard because the statutory minimum is the same for everyone. Anyone who reduces their working hours earns less, but the deduction remains the same.

Example: With 100%, you earn CHF 80,000; your insured salary is CHF 53,540. If you reduce your hours to 60%, you’ll earn CHF 48,000, and your insured earnings will fall to CHF 21,540. Your salary is 40% lower, but your insured earnings are around 60% lower. Consequently, less money goes into your pension fund.

Added to this is the entry threshold for the 2nd pillar (BVG). In 2026, this will be an annual salary of CHF 22,680. Anyone earning less than this threshold with a single employer is not affiliated to a pension fund under the statutory minimum and will have to rely on the AHV pension (Pillar 1) and their own savings in old age. This applies per employer: with two part-time jobs, you can remain below the threshold with both employers, even though your combined earnings exceed it.

Tip: Some pension funds adjust the coordination deduction in line with the working hours or waive it altogether. Depending on your employer and their pension fund, there is therefore some flexibility regarding the BVG deduction. This increases your insured salary and, with it, your contributions to the pension fund. When choosing an employer, this can be a topic to discuss during a job interview. The calculator above shows how this affects your salary.

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Conclusion to the article Coordination deduction simply explained

You should now be able to answer the question «What is the coordination deduction?»: It amounts to CHF 26,460 in 2026 and is deducted from your annual salary before pension fund contributions are calculated. You now also know what your insured salary is and how much it amounts to. Armed with this knowledge, would you perhaps vote in favour of abolishing the coordination deduction in a referendum, or not?

The next time you apply for a job, particularly for a part-time role, you can ask about the pension scheme and the contributions deducted. You can also discuss this with your boss whilst you’re already employed. The company might even consider switching to a better pension scheme if this is an issue for you.

Tip: If you want to know all the BVG key figures in detail, take a look at our data hub.

To be honest, will you still remember in four weeks’ time exactly what the insured wage is and how it’s calculated?

I look forward to honest comments 🙂 .

Sources:

FAQ

The relevant salary is the gross salary that is relevant for the 2nd pillar. Your annual salary may be higher, but the coordination deduction from the pension fund is deducted from this first. Only then is the insured salary calculated.

No, in principle you are not insured twice. However, if your employment is reduced, your pension fund contributions may fall, resulting in a pension gap. Some people supplement their pension provision with private provision (e.g. pillar 3a) in order to secure their accustomed standard of living.

The employer and employee (i.e. you) pay into the pension fund together. The coordinated salary is calculated from the gross salary "minus the coordination deduction" to determine the coordinated salary. The higher your insured salary, the more your employer pays into your pension.

Complete abolition would mean that no salary is deducted before contributions are due. This would increase your insured salary and your pension entitlements could grow. However, it remains to be seen whether this will be implemented politically.

If you stop working before regular retirement, you pay in for less time and may have a gap in your pension provision. You can counteract this with pillar 3a or additional private pension provision so that you can maintain your accustomed standard of living.

Yes, by keeping your insured salary as high as possible. For example, by organising your employment in such a way that the coordination deduction is less significant, or by making additional contributions to pillar 3a. This way you can reduce gaps even if you work part-time.

2 responses

  1. Dear Eric; thank you very much for the always well and understandably explained contributions; in my opinion, an error has crept in here, all the limit values mentioned are still from the year 2022. Due to the pension increase as of 01.01.2023, these have also changed accordingly. Best regards;

    Reply
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