Daycare subsidies in Zurich and Zug: Your comprehensive guide to reducing costs

Enabling High-Quality Childcare – How Subsidies Ease the Financial Burden for Families

The decision to choose high-quality supplementary childcare is one of the most important investments in a child's future. Particularly in the economically dynamic and correspondingly expensive regions of Zurich and Zug, financing an excellent nursery place presents many families with a significant challenge. The monthly costs can create a substantial hole in the family budget and make balancing family and career difficult.

This challenge is well recognised. Yet there's crucial support that's often overlooked or perceived as too complex: state nursery subsidies. These financial contributions are far more than just a discount. They're a targeted instrument of family support, designed to enable parents to access first-class early childhood education without having to compromise on quality. Subsidies are the bridge that means you don't have to choose between "affordable" and "excellent". They create the financial foundation for parents to select an environment for their child that optimally supports their development and provides the best possible start in life.

What are Nursery Subsidies in Zurich and Zug?

Nursery subsidies are income and asset-based state grants that ease families' financial burden. They enable access to high-quality childcare by significantly reducing the monthly costs for recognised nurseries and childminding services, thus supporting the balance between family and career.

This comprehensive guide has been developed to bring clarity and confidence to the regulatory jungle. It leads you step by step through the subsidy systems of the City of Zurich and the City of Zug, explains the exact eligibility requirements, shows the application processes, and illuminates the significant differences between the two models.

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The Zurich City Subsidy System in Detail – A Two-Part Process

The City of Zurich's subsidy model is highly effective, but also demanding in its structure. It's based on a two-tier system that requires two separate confirmations from two different municipal offices. A precise understanding of this process is the key to success.

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Eligibility Requirements: Who Benefits from Zurich Nursery Subsidies?

To benefit from municipal contributions, families must fulfil a series of clearly defined criteria. These ensure that support reaches precisely those families who need it and for whom it's intended.

Who is Eligible for Nursery Subsidies in the City of Zurich?

Families with registered civil residence in the City of Zurich are eligible. Allocation depends on income and asset circumstances as well as documented childcare needs arising from employment, education, or social and integrative reasons. The chosen nursery must also have a contract with the city.

The Four Central Pillars of Eligibility:

1. Civil residence in the City of Zurich: This is the most fundamental requirement. Only families officially registered in the City of Zurich can apply for municipal subsidies. Working in the city whilst residing outside it is not sufficient.
   
2. Economic circumstances: The subsidies are income and asset-dependent. They're aimed at families with low to medium incomes. As a rough guideline, families with a net income of up to approximately 200,000 francs (with two children and no significant assets) may be eligible. However, the exact calculation is complex and determined individually.
   
3. Documented childcare need: The city subsidises childcare when it's necessary to support the balance between family and work or to promote social integration. Recognised reasons include:
   
   • Parents' employment or regular voluntary work
   • A recognised education or training programme
   • Job seeking and measures to maintain employability
   • Supporting the child's linguistic integration (e.g., for insufficient German skills)
   • Supporting the child's social integration
   • Documented physical or psychological overload of parents requiring relief
     
4. Recognised childcare institution: Financial support is only granted for places at nurseries or childminding organisations that have signed a so-called contract with the Social Department of the City of Zurich. This contract ensures that the institution meets defined quality standards.
   
   

Naturally, all Little Star Day School locations in Zurich and Zug fulfil this important requirement and are recognised for accepting subsidised places.

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The Two Pillars of Zurich's Support System: Contribution Factor (BF) and Subsidised Care Scope (SBU)

The core of the Zurich system, and often the greatest hurdle in understanding it, is the division of the application into two independent components, which are processed by different offices. Only when both confirmations are obtained is the entitlement to subsidies fully clarified.

• The Contribution Factor (BF): The Amount of Parental Contribution
  The contribution factor is calculated by the School and Sports Department of the City of Zurich. It's a percentage (between 0% and 100%) determined on the basis of economic circumstances – namely taxable income and assets according to the most recent definitive tax assessment.
  
  • Function: The BF determines the level of personal parental contribution. A low contribution factor means high subsidy and low personal contribution.
    
  • Example: A BF of 0% means that only the minimum rate is paid. A BF of 100% means there's no entitlement to income-dependent subsidy and the maximum rate is paid.
     
• The Subsidised Care Scope (SBU): How Many Days Are Supported
  The SBU is determined by the Social Department of the City of Zurich. This confirmation defines how many childcare days per week the city will subsidise. The calculation is based on documented childcare needs, which are generally derived from the parents' combined working hours.
  
  • Function: The SBU sets the quota of supported days. For instance, if an SBU covers three days per week but the child attends nursery for four days, the fourth day isn't subsidised and must be paid at the nursery's full rate.
    
  • Calculation logic (for employment): The city adds both parents' working percentages and subtracts 100% (as equivalent to childcare by one parent). The result is converted into days, with 20% equating to one care day. For single parents, the 100% deduction doesn't apply.

This separation is administratively necessary but often confusing for parents. It's essential to understand that both documents – the contribution factor confirmation and the SBU confirmation – are needed to claim the full subsidy entitlement at the nursery.

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Step-by-Step Guide: Successfully Applying for Subsidies in Zurich

The path to a subsidised nursery place in Zurich requires a structured approach. The following guide describes all the necessary steps.

Step 1: Provisional Calculation and Orientation
Before starting the formal process, use the City of Zurich's official online calculator. This tool provides a reliable, albeit non-binding, initial assessment of eligibility and the likely parental contribution. This helps with budget planning.

Step 2: Applying for the Contribution Factor Confirmation (BF)
The official subsidy application is ordered from the School and Sports Department. This can be done via an online form on the City of Zurich website. The pre-filled application, sent by post, should be checked, corrected if necessary, signed and returned with the required documents (usually the most recent definitive tax assessment). After reviewing the documents, the school office issues the official contribution factor confirmation. Allow several weeks for processing.

Step 3: Applying for the Subsidised Care Scope (SBU)
This application is usually made digitally via the municipal online portal. Here you state the reason for childcare need (e.g., employment) and upload the corresponding evidence (e.g., employment contracts). The Social Department reviews the information and issues the SBU confirmation, which sets the number of subsidised days per week. If the care reason is social or linguistic integration, the application is usually made through a responsible specialist office such as Social Services.

Step 4: Securing a Nursery Place and Signing a Contract
Parallel to steps 2 and 3, actively search for a place at a recognised nursery. Sign a care contract. Important: The nursery management should be informed from the outset that subsidies are being applied for. Until the definitive confirmations are available, the nursery will generally invoice at the full rate. Retrospective subsidisation isn't possible.

Step 5: Submitting Confirmations to the Nursery
Once both documents – the BF confirmation and the SBU confirmation – are available, submit them to the nursery immediately. The nursery administration then adjusts the monthly invoice to the subsidised rate and settles directly with the City of Zurich.

The following table provides a clear summary of the process:

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Table 1: Application Checklist for Nursery Subsidies in the City of Zurich

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Cost Case Study: What Does a Nursery Place in Zurich Really Cost with Subsidies?

To make the theory tangible, here's a calculation example based on the City of Zurich's official methodology.

Assumptions for an example family:

• A married couple with one child
• Residence in the City of Zurich
• Combined taxable income: CHF 90,000
• Taxable assets: CHF 60,000
• The child attends nursery 3 days per week (SBU for 3 days is in place)

The calculation of the monthly parental contribution follows several steps, which are transparently broken down in the following table.

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Table 2: Sample Calculation of Parental Contribution for the City of Zurich

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Without subsidies, this family would pay approximately CHF 1,680 monthly for three days per week at an average private rate of CHF 140 per day. The subsidy therefore results in savings of almost CHF 600 per month.

At this point, a crucial advantage becomes apparent that goes beyond mere cost reduction. Once you know the subsidised contribution, the question of cost transparency arises. At many childcare facilities, additional fees may apply for meals, nappies, special development programmes or outings. This makes budget planning difficult. In contrast, Little Star Day School's all-inclusive concept offers complete financial predictability. At Little Star Day School, the calculated, subsidised parental contribution covers all services: from freshly prepared organic meals to all hygiene products and the varied development programme. This makes the investment not only calculable but also ensures that your child benefits from a holistic, first-class educational offering without hidden extra costs.

The Childcare Voucher System in the City of Zug – Modern and Straightforward

Whilst Zurich relies on an established but administratively demanding system, the City of Zug has opted for a modern and considerably more straightforward model: childcare vouchers. This system is characterised by clear criteria, a centralised application process and direct financial support for parents.

Eligibility Requirements: The Criteria for Childcare Vouchers in Zug

The requirements for receiving childcare vouchers in the City of Zug are transparent and easy to understand.

Who is Eligible for Childcare Vouchers in the City of Zug?

Families resident in the City of Zug are eligible for children from 3 months old until primary school entry. Prerequisites are a relevant income below CHF 160,000 and taxable assets below CHF 500,000. Childcare must take place at a recognised nursery in the Canton of Zug.

The key criteria at a glance:

1. Residence in the City of Zug: As in Zurich, the family's official residence in the City of Zug is crucial.
   
2. Child's age: The child must be older than three months and not yet attending the 1st primary school class
3. Income and asset caps: Here Zug defines clear and generous limits:
   • Parents' relevant income must not exceed CHF 160,000 per year
   • Taxable assets must be below CHF 500,000
     
4. Recognised nursery: The child must be cared for at a nursery recognised by the City of Zug. A major advantage of the Zug model is its flexibility: the recognised nursery can be located anywhere in the Canton of Zug, giving parents a greater choice.

The Path to a Childcare Voucher: The Application Process in Zug Simply Explained

The application process in Zug is considerably streamlined and centralised compared to Zurich, making it significantly simpler and faster for parents.

Step 1: Select a Recognised Nursery and Secure a Place
‍Find a suitable childcare place for your child at a nursery recognised by the City of Zug. An official list of these nurseries can be found on the city's website. Then sign a childcare contract.

Step 2: Obtain Childcare Confirmation from the Nursery
‍The nursery confirms the care place and scope of care on the official form "Childcare Confirmation from the Nursery". This form is a central component of the application.

Step 3: Submit Application to the City of Zug
Submit the completed application form together with the childcare confirmation and other necessary documents (e.g., most recent tax assessment) to the central responsible office: the Child Youth Family Department of the City of Zug. The application can be submitted electronically or by post. The deadline is important: the application must be submitted by the month before care begins at the latest, as entitlement cannot be claimed retrospectively.

Step 4: Decision and Monthly PaymentA
fter reviewing the application, the Child Youth Family Department notifies you in writing whether and to what extent you're entitled to childcare vouchers. A crucial difference from Zurich: the approved amount is paid monthly in advance directly into the parents' bank account. Parents then pay the nursery's full invoice themselves and use the voucher to cover part of these costs.

Naturally, Little Star Day School in Zug is amongst the recognised and leading quality nurseries where childcare vouchers can be redeemed for high-quality, bilingual education. Little Star Day School's administration is familiar with the Zug system and serves as a competent partner for obtaining childcare confirmation and answering administrative questions.

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The Zug Advantages: Why the System is Particularly Attractive for Families

The Zug model is not only unbureaucratic but is also being actively developed to provide even greater relief for families. This makes Zug particularly attractive as a location for families.

• Significant cost reduction: On 1st January 2024, the City of Zug adjusted the parameters for childcare vouchers, resulting in a reduction of nursery costs for eligible families of up to 25%. This is a direct and tangible financial relief.
  
• Future cantonal subsidy: The Canton of Zug is planning to introduce an additional cantonal subsidy to be paid to working parents regardless of income. This subsidy should be combinable with the income-dependent childcare vouchers from the municipalities, which will reduce the financial burden even further in future.
  
• Simplicity and transparency: A central point of contact, clear income limits and an uncomplicated application process make the system easily understandable and accessible for parents. Direct payment to parents also creates maximum transparency regarding the support funds received.

Comparison at a Glance: The Subsidy Models of Zurich and Zug

For families who may be choosing between the two locations, the following table provides a clear comparison of both systems. It summarises the most important differences and serves as a quick decision-making aid.

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Table 3: Key Differences Between the Subsidy Systems of Zurich vs. Zug

Making Optimal Use of Additional Financial Benefits for Families

Alongside direct subsidies, there are other important financial instruments that parents should know about and utilise. A holistic strategy encompassing both direct grants and tax benefits maximises financial relief.

Tax Deductions for Childcare: An Often Underestimated Savings Potential

Costs for supplementary childcare represent not only a monthly expense but can also significantly reduce your tax burden. This is the second important pillar of cost reduction.

Can You Deduct Nursery Costs from Tax?

Yes, in Switzerland, documented costs for third-party childcare of children up to 14 years can be deducted from taxes. The maximum deduction is CHF 25,000 per child per year for both federal direct tax and in the Cantons of Zurich and Zug.

‍Requirements for deduction: The following conditions must be met for costs to be claimed:

• Documented costs: The actual costs paid for childcare must be verifiable through invoices and payment receipts. Therefore, all nursery invoices should be carefully retained.
  
• Child's age: The child must not have reached their 14th birthday and must live in the same household as the taxpayer.
  
• Causal connection: Childcare costs must be directly related to parents' employment, education, training or documented incapacity for work. Costs for a babysitter so parents can pursue private leisure activities are not deductible.

Amount of deduction: Deductions have been significantly increased in recent years to provide greater relief for families:

• Federal direct tax: From tax period 2023 onwards, up to CHF 25,000 per child per year can be deducted.
  
• Canton of Zurich: The maximum deduction for state and municipal taxes has also been increased to CHF 25,000 per child per year and can be claimed for the first time in the 2024 tax return.
  
• Canton of Zug: The Canton of Zug also allows a generous deduction of up to CHF 25,000 per child per year.

This deduction reduces taxable income and, depending on the tax bracket, leads to considerable tax savings. It's strategic financial planning to use direct nursery subsidies to reduce monthly expenses, then claim the remaining net costs in your tax return.

Important Distinction: Family Allowances vs. Nursery Subsidies

In the context of financial support for families, two terms are often confused despite having fundamentally different purposes and legal foundations: family allowances and nursery subsidies. A clear distinction is important to understand and utilise both systems correctly.

• Family Allowances (Child and Education Allowances)
  Family allowances are legally enshrined, general financial support designed to partially offset the costs of maintaining children.
  
  • Purpose: They contribute to a child's general living costs (clothing, food, housing, etc.) and aren't linked to any specific service.
    
  • Eligibility: Fundamentally all employees, self-employed persons and non-working people with low income are eligible, regardless of whether the child receives external care or not.
  • Type of benefit: This is an employment-related benefit, usually paid monthly with salary. The amount is regulated cantonally (in Zurich, for example, CHF 215/month for children up to 12 years).
    
    
• Nursery Subsidies (Contributions or Childcare Vouchers))
  Nursery subsidies are earmarked financial support for the use of supplementary childcare.
  
  • Purpose: They're specifically intended to reduce the costs of nurseries or childminding services that become necessary due to parents' employment, education or social reasons.
    
  • Eligibility: Entitlement is linked to specific conditions (see Parts 1 and 2), particularly proof of childcare need and the family's economic situation.
    
  • Type of benefit: This is either a reduction in the nursery invoice (Zurich) or a direct financial grant to parents (Zug), which may only be used to pay childcare costs.

In summary: Family allowances are received because you have a child. Nursery subsidies are received because the child attends nursery due to life circumstances and financial support is needed for this. Both systems exist alongside each other and can and should be combined by eligible families to achieve maximum financial relief.

Conclusion: The Path to High-Quality and Affordable Childcare

Supplementary childcare in the Cantons of Zurich and Zug represents a significant financial commitment, yet the comprehensive subsidy systems offer effective relief. As this guide has demonstrated, whilst the paths to support differ, the goal remains the same: to facilitate families' access to high-quality care and strengthen the balance between work and family life.

In the City of Zurich, families encounter an established but administratively demanding system that requires careful planning and coordination with two different offices. The reward is a substantial cost reduction applied directly at the nursery. In the City of Zug, families benefit from a modern, straightforward childcare voucher system with clear criteria, a central point of contact, and a proactive policy that will continue to provide further relief for families in future.

Regardless of the chosen location, the combination of direct subsidies and generous tax deductions significantly lowers the financial hurdle to first-class care. These instruments transform a potentially unbearable financial burden into a manageable and, above all, worthwhile investment.

Because ultimately, it's about more than just childcare. It's about providing the best possible support for your child during the most formative years of their life. This is where the circle closes. Little Star Day School is not merely a recognised, subsidy-eligible institution in both cantons. It's a partner that maximises the value of this state support by combining it with invaluable benefits for your child.

The unique, scientifically-based Early Years Curriculum EYC®, genuine, lived bilingualism through the immersion method, and the worry-free all-inclusive concept ensure that your child is not only lovingly cared for but holistically supported. The subsidies thus transform from mere cost reduction into an intelligent investment in cognitive, social and emotional development – and therefore in your child's future opportunities.

For further information on how your child can benefit from this unique concept and what support is offered throughout the subsidy process, our family advisers are available for a personal, no-obligation consultation.