Purchase and tax benefits of social security

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Capital contributions from third pillar provision are taxed in Switzerland, as well as the income from day-to-day abolition. Both the premature purchase and ordinary purchase of the capital from the third pillar require immediate taxation of said capital. The bank or insurance partner of which the pension agreement relates to, also known as the pension fund, must immediately report the amount to the FederalTax Administration. The resulting tax amount is then determined by the tax administration and collected by the cantonal or municipal tax office. The pledged provision of pillar 3a is therefore taxed separately and detached from regular tax. In short, the payout does not automatically push you into a higher stage of progress with purchase.

Tax shares of capital contribution from the provision for Federal Government, the municipality and the canton

The tax on capital contributions from a pension scheme is divided up between the canton, the municipality, and the federal government. Cantons and municipalities apply varying tax rates, but the tax rates are generally lower than regular income tax. For the calculation of exact tax amounts, it is advised that you search the website of the corresponding tax authority. There, you'll find all the information you need on taxation, progression, in addition to the tools required for detailed calculation of all tax payments made.

Transfer of capital from the pension agreement in the thirdpillar

The withdrawal of savings in the thirdcolumn are subject to differentrequirements, depending on whether or not itislinkedunderPillar 3a or the unrestricted pension Pillar 3b.


  • Pillar 3b: Prevention agreements within the framework of Pillar 3b can generally be resolved and paid out at any time without much difficulty. Therefore, there'slittle to consider apart from contractually agreed terms.
  • Pillar 3a:In Pillar 3a, the pension benefit is linked directly to the pension income. Payments canbe received as early as 5 years before and up to 5 years thereafter. Alternatively, an advance withdrawal is also possible, for example come the purchase of a home or in order to pay back a mortgage on a residential property.

The reference period makes it possible to plan the remuneration of the capital contributions from the pension plans precisely and to distribute them over time since financial advantages can be secured in some cases.

Tip: Distribute payments from the capital contribution from pension arrangements

Capital payments from precautionary provisions are taxed progressively. In other words, if several retirement contracts or, in addition, pension fund capital (Pillar 2) are obtained within the same year, the capital is taxed together. This, in turn, leads to higher taxes. The payment from the second pillar should therefore not be made in the same year. Similarly, different pension arrangements within the third pillar should be paid out at different times, if several have been concluded. The same applies to married couples. If a spouse or life partner pays his credit in the same year, the child's earnings are jointly taxed.

MoneyParkis at your at your disposal with first-rate advice

Proper retirement provision is intended to be well thought out and planned from the date of conclusion of private pension plans, through to the disbursement of the capital contribution from the pension plan. At MoneyPark, our employees are at your disposal with independent consultation. We'll help you find the right investment options that best fits your personal requirements and let you achieve the best possible savings and savings in capital investments. Simply make an appointment with a MoneyPark consultant in the area in which you need to discuss, then enjoy competent and impartial advice from some of the best experts in the business. We're here to help ensure you enjoy the transition from working life through to retirement without any worries whatsoever.

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