The 3rd pillar in Switzerland allows everyone to secure their retirement by implementing a private provident strategy through a customized third pillar solution. Complementing AHV (1st pillar) and occupational pension provision (2nd pillar) benefits, the 3rd pillar plays an essential role in building a solid foundation for retirement.
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Parmi les déductions fiscales possibles en Suisse, le 3e pilier est très apprécié, car il offre également un avantage fiscal et permet de se constituer un capital. Vous pouvez déduire au maximum 7’056 CHF en 2024.
Les freelancers n’ayant pas souscrit à un 2ème pilier peuvent déduire 20% de leur revenu, mais au maximum 35’280 CHF en 2024.
Eligibility criteria for Pillar 3a contributions in Switzerland
To qualify for the Pillar 3A deduction in Switzerland, certain criteria must be met.
These criteria are designed to ensure that only eligible individuals can benefit from the advantages offered by this personal pension plan.
Here are the main criteria to consider:
Reside in Switzerland and be affiliated to the AVS scheme
This criterion is essential for taking out a Pillar 3a. In general, only people whose tax domicile is Switzerland are eligible (with the exception of cross-border commuters). In addition, you must be affiliated to the AVS.Under legal retirement age
To benefit from the advantages of Pillar 3a, it is important to take out the policy before the legal retirement age, i.e. 65 for men and 64 for women.Income from gainful employment
To qualify for the tax deduction, you must also have income from a gainful activity (e.g. salary, self-employment, etc.).
If you meet these criteria, you can benefit from the tax advantages offered by Pillar 3a in Switzerland.
Differences between pillars 3a and 3b in Switzerland
Switzerland's three-pillar system is designed to provide financial security for individuals once they retire, enabling them to maintain the same standard of living.
As the 3rd pillar is optional, it enables those who wish to do so to save for their retirement.
The third pillar is an individual pension plan, which means that each individual can choose how to invest his or her money, in particular by choosing his or her approach to risk (low/medium/high) and obtaining returns accordingly.
Vous trouverez ci-dessous, les principales différences entre les piliers 3a et 3b.
Pillar 3a: tied retirement provision
Pillar 3a is intended for retirement provision related to retirement age. This means that you cannot withdraw your savings before retirement age, except in certain exceptional cases such as the purchase of your principal residence or definitive departure abroad (outside the EU).
One of the main advantages of Pillar 3a is the tax deductibility of contributions up to CHF 7,056 in 2023.
What's more, the funds invested and interest income generated by Pillar 3a are exempt from income and wealth tax.
However, the capital is taxed at the time of payment on reaching retirement age, and taxed separately from income at a reduced rate of 1/5, i.e. 20% of the normal rate.
D’autre part, il peut également être utilisé pour combler les lacunes dans la prévoyance vieillesse, ou en cas de décès ou d’invalidité.
In summary, the characteristics of the 3rd Pillar A are as follows:
- Withdrawal is at retirement age (except in special cases).
- Tax advantage, as deductible at cantonal and federal level.
- Tax-free during the contribution period.
- Reduced taxation on lump-sum payments.
Pillar 3b: individual savings
Le pilier 3b concerne l’épargne individuelle et diffère du pilier 3a en termes de déductibilités fiscales.
Pillar 3b contributions are not deductible at federal level, while in Geneva the deduction is capped.
The main distinction between the two pillars lies in the availability of funds. Unlike Pillar 3a, Pillar 3b funds can be withdrawn more freely and at any time, offering greater flexibility.
Like Pillar 3a, Pillar 3b is subject to lump-sum payment.
In addition, the surrender value of the 3rd pillar B must be declared in the tax return, this amount is taxable at wealth tax.
In summary, the characteristics of the 3rd Pillar B are as follows:
- Flexible, easy removal.
- Tax advantage only at cantonal level (for Geneva).
- Taxable during the contribution period.
- Reduced taxation on lump-sum payments.
Benefits of the 3rd pillar for the self-employed
The 3rd pillar is one of the simplest ways for the self-employed to build up assets for their retirement. The self-employed are not legally obliged to take out a 2nd pillar, as most of them only contribute to the AVS. This can leave a significant gap in your pension once you retire.
Below are the advantages for self-employed people of taking out a 3rd pillar.
Retirement savings
One of the main aims of the 3rd pillar is to ensure the financial security of the self-employed when they retire.
By saving every year, they can build up a capital sum that will enable them to maintain their standard of living once they stop working.
This ensures a smooth transition to retirement, without having to worry about financial difficulties.
Attractive tax benefits
Le 3ème pilier permet également de faire des économies d’impôts importantes. En effet, les cotisations versées dans leur 3ème pilier sont totalement déductibles à hauteur de 20% de leur revenu, mais au maximum 35’280 CHF, ce qui permet de réduire considérablement la charge d’imposition.
This not only represents immediate savings, but also an effective way of optimizing your tax situation over the long term.
It's important for the self-employed to take these advantages into account and seek expert advice to choose the best 3rd pillar plan for their specific needs.
Conseils en matière de prévoyance suisse
The 3rd pillar offers many advantages and options for individuals wishing to save for their retirement. Most working people in Switzerland can benefit from it.
There are also different investment options available, giving savers the chance to choose the one that best suits their financial goals.
It is also possible to take out several 3rd pillars to compensate for the progressive tax rate.
Our experts are at your disposal to give you the best possible advice, in complete independence from the insurance companies and/or banks offering this type of product.
FAQ - 3rd pillar
In general, anyone living or working in Switzerland can contribute, whether employed or self-employed.
Le montant maximum déductible en cas d’activité lucrative employé est de 7’056 CHF en 2024.
For self-employed people not affiliated to a 2nd pillar, the 3rd pillar deduction can be 20% of their income, but a maximum of 35,280 CHF.
It's a good idea to start thinking about retirement early in your working life. In general, the sooner you start saving, the better.
This will allow you to benefit from a longer savings period and take advantage of compound interest.
In general, early withdrawals from your 3rd pillar are subject to restrictions and penalties, except in certain specific cases such as disability, death or the purchase of your principal residence.
The 1er pilier (AVS) est le pilier de base, permettant de garantir un niveau de vie basique au moment de la retraite.
The 2ème pilier permet de garder un niveau de vie similaire à l’antérieur.
The 3ème pilier est facultatif et permet d’améliorer la couverture vieillesse, tout en présentant des avantages fiscaux.
The 3eme pilier a (prévoyance liée) est plus restrictif que le pilier 3b, car les fonds ne peuvent être retirés avant l’âge de la retraite que sous certaines conditions. Le pilier 3a est principalement destiné à la constitution d’un avoir retraite, mais il présente également des avantages fiscaux intéressants.
Le pilier 3b est plus flexible et permet de se constituer une épargne pour diverses raisons (pas seulement la retraite). Il est possible de disposer des fonds assez librement, les avantages fiscaux sont donc moins importants que le pilier 3a.
