3rd Pillar Pensions
The pension system in Switzerland is based on three pillars:
1. State Pensions
2. Occupational Pensions
3. Private Pensions
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Pillar 3a
The pillar 3a – or what most people call a 3rd pillar pension – is a private, voluntary scheme, designed to encourage individuals resident in Switzerland to save for their own futures.
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Pillar 3b
The pillar 3b is a private, voluntary scheme available to residents of Switzerland. Unlike the pillar 3a (hyperlink), there is no income tax deduction for money invested into the pillar 3b.
3rd Pillar Pensions
3rd pillar pensions are private, voluntary schemes, designed to encourage individuals to save for their own futures, and thus become less of a burden on the state in old age. Discover the specifics of Pillar 3a Pensions.
The incentives to open 3rd pillar pensions can be broadly split into two different options:
Pillar 3a
- Maximum contribution CHF 7,056 (employed) or CHF 35,280 (self-employed) per year
- Contributions are deductible from income tax
- Tax savings typically in the range of CHF 1,500-3,500 per person per year
- Take with you when you leave Switzerland
- Keep in Switzerland if you move abroad
- Option of a Capital Guarantee to protect from risk
- Option of interchangeable funds/ETFs/securities to maximise returns in a personalised portfolio
- Ability to use towards the deposit and/or repayment of a Swiss property
- Can only be accessed under certain conditions
- Click here for more details
Pillar 3b
- No limit on annual contributions
- No tax on growth or investment income
- No tax on withdrawal
- Unrestricted – can be used for any purpose at any time
- Take with you when you leave Switzerland
- Keep in Switzerland if you move abroad
- Option of a Capital Guarantee to protect from risk
- Option of interchangeable funds/ETFs/securities to maximise returns in a personalised portfolio
- Ability to use towards the deposit and/or repayment of a Swiss property
- Can be used to: save for retirement / save for kid’s higher education / wealth accumulation
- Unrestricted – can be used for any purpose at any time
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