The most crucial consideration when depositing into Pillar 3a

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The bound pension planning in the third pillar delivers enticing tax privileges in the form of provisions for retirement age, not to mention the validation of risky ventures. Contributions paid into Pillar 3a can also be deducted from taxable income. However, this perk comes with a small print. In order to qualify for this deduction, you’ll need to ensure you’re paying into retirement insurance and are at least 18 years old. Provided that the individual has previously held employment, they can only pay contributions into the third pillar 5 years after their entry into the statutory pension age.

The Swiss Federal Office of Social Insurance lays down upper limits for Pillar 3a. Maximum amounts are announced at the end of every calendar year for the coming year. When it comes to assessing the upper limit, it’s important that a person pays into the second pillar (occupational pension scheme). You’ll be able to find out more information on our page dedicated to the Pillar 3a calculator.


  • Lower limits for employees and self-employed persons (as of 2020: CHF 6826)
  • Upper limits for self-employed persons who do pay into a pension fund for occupational pensions (as of 2020: CHF 34'128). It’s worth noting that the amount may not exceed 20% of net income.

Anyone wishing to make investments beyond the upper limit can do so by making payments into Pillar 3b. Contrary to Pillar 3a, there is no tax savings, but the beneficiary does not have to pay attention to restrictions and regulations relating to payment and withdrawals.

Beiträge Säule 3a

Certificate of tax deductibility

When you open an account for a restricted pension plan, you’ll receive a certificate from the institution where you have registered your account. This usually arrives at the beginning of the year. In order to deduct the amount paid from earnings, the enclosed tax return certificate must be enclosed. You can find further information about tax and Pillar 3a right here online at MoneyPark.

How the payment is made into Pillar 3a varies. Depending on the specific product offered by a bank or insurer, the deposit can be made in one large sum or at intervals. In this instance, retirement accounts, life insurance and similar products are available in a large variety of options. It’s always important to consider risks and interest levels when picking one of these products.

When it comes to tax advantages, it’s also crucial that you remember that these perks only occur in a gradual manner. Ideally, individuals are advised to open several accounts and deposit money between them. You can find detailed information about this approach here.

Comprehensive cover is only possible with Pillar 3a

Anyone wishing to fully protect themselves financially is advised to make payments into Pillar 3a. The first and second pillar are designed to cover around 60% of the final wage takings of an individual. This is intended to enable those of pension age to continue a comfortable way of life. However, an immediate income gap is created and previous income disparage is continued on into pension age. This can become a serious problem should an unforeseen crisis arise, such as illness or a family emergency.

To close this gap, cover payment losses and reduce the risks for individuals, payment into Pillar 3a and thorough comparisons of Pillar 3a products is essential. MoneyPark are on hand to provide you with bespoke advice and guidance on pension plans that’s tailored to you and your circumstances. We're on hand to ensure you make the most of tax advantages during your withdrawals, ensuring you enjoy financial freedom and a stress-free retirement once the time comes.

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