Pillar 3a

Switzerland's retirement system rests on three pillars: the state pension, the AHV, the occupational pension from your employer, the Pensionskasse, and private provision, the third pillar. Pillar 3a is the tied part of that third pillar: a dedicated account, or an insurance policy, that you fund yourself, in exchange for generous tax treatment. Because it's tied, the money is committed to retirement and can't be dipped into freely.

The yearly maximum depends on whether you also have a pension fund (2nd pillar):

In 2026 you can pay in up to CHF 7,258 if you're in a pension fund, as most employees are, and otherwise 20% of your earned income, up to CHF 36,288. You generally need income subject to AHV contributions to pay in at all, and you can't pay in more than the maximum, except as a top-up for earlier years (see below): anything above it has to be paid back to you.

To count for 2026, a contribution has to be credited to your 3a account, or to your 3a policy, by 31 December 2026, or by the last day you're taxable in Switzerland if that comes first, for example when you move abroad. What counts is the day it's credited to your own 3a account: not the day the money leaves yours, and not the day it reaches the bank's or insurer's general account. So says the Federal Tax Administration's circular on Pillar 3a (Kreisschreiben Nr. 18a, Ziff. 5.1), and so the Federal Supreme Court ruled in BGE 148 II 556: a transfer made on Friday, 29 December 2017 was credited to the 3a account only on 3 January 2018, after a weekend, New Year's Day and Berchtoldstag, and could not be deducted for 2017. So don't leave it to the last days of the year.

The tax advantage works at three separate points:

1. 1

   Going in

   The full contribution comes off your taxable income. At a marginal tax rate of 25%, paying in 7,258 saves 1,814.50 in tax. The 25% is only an example: your rate depends on your canton, municipality, income and marital status.

2. 2

   While invested

   The balance is exempt from wealth tax, and interest and gains aren't taxed as income for the life of the account.

3. 3

   Coming out

   The payout is taxed once, separately from other income, at a reduced rate, not at your normal marginal rate.

A 3a account pays interest, like a savings account. A 3a fund invests the money, usually in a mix of shares and bonds, so it can grow more and can also fall. Here's CHF 7,258 a year for 30 years, paid in at the end of each year, at two example rates:

Over 30 years you pay in CHF 217,740.00. At 0.5% a year, the account grows to CHF 234,288.36. At 4% a year, the fund grows to CHF 407,064.48, CHF 189,324.48 more than you paid in. Both rates are examples, not forecasts: a fund's value swings along the way, and money you'll need within a few years is safer in the account.

That's the honest caveat: 3a money is locked. You can take it out at the earliest five years before your AHV reference age, and it's paid out when you reach it; if you keep working, you can leave it in for up to five more years. Before that, only a few things release it: buying or building a home you live in, or paying down its mortgage, at most once every five years; leaving Switzerland for good; starting self-employment, if you're then no longer in a mandatory pension fund, or switching to a different kind of self-employment, both within a year; receiving a full disability pension, if the disability risk isn't insured; or buying into your pension fund. If you're married or in a registered partnership, withdrawing for a home, emigration or self-employment needs your spouse's or partner's written consent.

Because the payout is taxed as a lump sum, taking everything in one year can push it into a higher bracket. Spreading your savings across several 3a accounts and closing them in different years keeps each payout, and its tax, smaller.

Since 2026 you can close past contribution gaps. If you didn't pay the maximum in an earlier year, you can make it up later, for gaps going back up to ten years, starting from the 2025 tax year. Four conditions: you must pay the current year's full amount first, you can catch up at most the "small" 3a maximum per year, you need income subject to AHV contributions in Switzerland both in the year you make up and in the year you pay, and you can't have drawn any 3a retirement benefit yet, not even from one of several accounts. Top-ups are fully deductible, just like regular contributions.