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PENSIONS & INVESTMENTS

Third pillar: build capital and prepare for the future

UAG & Associés helps you choose a solution adapted to your personal, professional and family situation.

DISCOVER OUR SOLUTIONS CALCULATE MY PILLAR 3A
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THE KEY POINTS

What to know before you choose

The third pillar is the optional part of Swiss retirement provision. It comes in two forms: restricted provision (pillar 3a), governed by law and tax-privileged, and free provision (pillar 3b), more flexible but without an annual deduction.

A VOLUNTARY SUPPLEMENT

The AVS and your pension fund together aim to maintain around 60% of your final income. The third pillar helps to close the gap between that level and your actual standard of living.

TWO DISTINCT REGIMES

Pillar 3a is capped, reserved for people in gainful employment and subject to withdrawal conditions. Pillar 3b has neither a ceiling nor access conditions.

A TAX DECISION

Pillar 3a contributions are deducted from taxable income every year, and the capital is then taxed separately on withdrawal. Pillar 3b offers no such deduction but remains free in how it is used.

A CHOICE TO REVIEW

Ceilings, withdrawal age, beneficiaries and buy-in options change with the law and with your family or professional situation.

Understanding the Three Pillars System

In Switzerland, the third pillar complements state and occupational pension benefits. It helps prepare for retirement, build capital and, depending on the solution, protect loved ones.

01

1ST PILLAR: STATE

Public welfare (AVS). Mandatory state insurance.

02

2ND PILLAR: EMPLOYER

Professional pension plan (LPP). Compulsory professional insurance for employees.

03

3RD PILLAR: INDIVIDUAL

The optional individual supplement: linked insurance 3a or free 3b.

PENSION SOLUTIONS

According to your objectives and your profile
3A OPTIMIZATION
3A / 3B
TODAY. CAPITAL PROTECTION RETIREMENT FUTURE RETIREMENT HORIZON

Why private pension provision remains necessary

AVS and pension fund benefits are designed to cover only part of your final salary between them. In practice, not everyone reaches that target: high incomes, part-time work, self-employment and interrupted careers often show a wider gap.

The AVS pension is capped and occupational provision insures only part of your salary, after the coordination deduction. The third pillar builds up, over time, the capital that offsets this difference and funds the plans you have for life after work.

60%

Share of final income targeted by the 1st and 2nd pillars combined.

7’258

Maximum pillar 3a contribution in 2026, in francs, with a pension fund.

5 years

How far in advance the 3a capital can be withdrawn before the AVS reference age.

RESTRICTED AND FREE PENSION PROVISION

Pillar 3a and pillar 3b: two different approaches

The two forms of third pillar are not mutually exclusive. They serve different objectives and can be combined depending on your taxable income, your time horizon and your need for available funds.

Pillar 3a — restricted provision

Pillar 3a is intended for retirement. In return for an annual tax advantage, the law sets the contribution amounts, the term and the situations in which the capital may be withdrawn.

  • Open to people earning income subject to AVS contributions in Switzerland, whether employed or self-employed.
  • Contributions capped each year and deductible from taxable income within the legal limits.
  • Capital exempt from wealth tax throughout the term of the contract.
  • Withdrawal possible at the earliest five years before the AVS reference age, or in the cases provided for by law.
  • Beneficiaries designated in the order laid down by law, with limited room for manoeuvre.

Pillar 3b — free provision

Pillar 3b covers savings and insurance built up freely. It offers no annual income deduction but leaves you free to choose the amounts, the term, the use and the beneficiaries.

  • Available to anyone, with or without gainful employment, including after retirement.
  • No contribution ceiling and a contract term defined freely.
  • Contributions generally not deductible, apart from the general cantonal deduction for insurance premiums.
  • Surrender value included in taxable wealth during the contract.
  • Beneficiaries chosen freely, subject to the statutory entitlements of inheritance law.

Detailed comparison: pillar 3a or pillar 3b

The criteria below summarise the main differences in treatment between the two forms of private pension provision. The exact tax rules depend on your canton of residence.

CRITERION PILLAR 3A PILLAR 3B
Who can contribute People in gainful employment subject to AVS contributions in Switzerland. Anyone, regardless of gainful employment.
Contract term In principle until the AVS reference age. Term chosen freely.
Maximum contribution 2026 CHF 7’258 with a pension fund; 20% of net income and a maximum of CHF 36’288 without a pension fund. No legal ceiling.
Deduction of contributions Deductible from taxable income within the legal limits. Generally not deductible, apart from the general deduction for insurance premiums.
Wealth tax No wealth tax during the term of the contract. Surrender value included in taxable wealth.
Taxation of the capital paid out Taxed separately from other income, at a reduced rate. Capital benefit exempt from income tax if the legal conditions are met.
Pledging Possible only for owner-occupied residential property. More broadly possible, depending on the contract.
Early withdrawal Limited to the grounds provided by law and possible at the earliest five years before the reference age. Possible according to the contractual conditions.
Beneficiaries in the event of death Statutory order of beneficiaries, with limited room for manoeuvre. Beneficiaries designated freely, subject to statutory inheritance entitlements.
Catching up on contributions Gaps can be bought back since 2026 for years from 2025 onwards, within a ten-year period. Additional contributions possible freely at any time.

Amounts applicable in 2026 under the Ordinance on Restricted Individual Pension Provision (OPO 3). General information, not individual advice.

How much can you contribute in 2026?

The ceiling depends on whether you belong to a pension fund. To be deducted from that year’s income, the contribution must be credited to the bank or insurer by 31 December at the latest.

Contributing early in the year gives the capital more time to earn interest or investment returns. Regular monthly contributions remain possible and make budgeting easier.

WITH A PENSION FUND CHF 7’258

Maximum deductible amount for people affiliated to an occupational pension institution.

WITHOUT A PENSION FUND CHF 36’288

Ceiling corresponding to 20% of net income from gainful employment, notably for self-employed people.

RETROACTIVE BUY-INS SINCE 2026

Since 1 January 2026, contribution gaps can be filled retroactively, but only for years from 2025 onwards and within a ten-year period. Earlier years are permanently lost.

A buy-in requires income subject to AVS contributions both in the year concerned and in the year of the buy-in, as well as payment of the ordinary ceiling for the current year. The amount bought back is deductible from income in the year it is paid.

Bank solution or insurance solution?

A pillar 3a can be opened with a bank or an insurance company. Both routes follow the same tax rules but do not commit you in the same way.

Bank-based pillar 3a

As a savings account or a securities investment, a bank pillar 3a leaves the amount and rhythm of contributions free. It includes no cover in the event of disability or death.

  • Contributions can be interrupted or resumed with no contractual consequence.
  • Management fees and the share invested in securities should be compared carefully.
  • Transfer to another institution generally possible.

Insurance-based pillar 3a

An insurance solution combines savings with risk cover. It is based on a commitment to contribute over a set period, in exchange for guaranteed benefits.

  • Capital or pension provided in the event of disability or death.
  • Waiver of premium payments possible in the event of incapacity to work.
  • Surrender values to be examined before any early termination of the contract.

The two approaches are often combined: an insurance share to protect the family and a bank share to retain flexibility. We compare offers on identical assumptions before any policy is taken out.

WITHDRAWING THE CAPITAL

When and how to withdraw your third pillar

The withdrawal schedule directly affects the tax due. It is prepared several years in advance, in coordination with your other pension capital.

WITHDRAWAL AGE

Pillar 3a capital can be drawn at the earliest five years before the AVS reference age. If you continue in gainful employment, withdrawal can be deferred until up to five years after that age, with the option of continuing to contribute.

EARLY WITHDRAWAL

The law allows withdrawal before maturity to buy or amortise owner-occupied property, to become self-employed, to leave Switzerland permanently, on the award of a full disability pension, or for a buy-in into your pension fund.

STAGGERING FOR TAX

The capital is taxed separately from other income, at a reduced but progressive rate. Splitting assets across several pillar 3a accounts and withdrawing them in different tax years often limits this progression.

Several cantons add together withdrawals made in the same year, including those of a spouse or registered partner, and take second pillar capital into account. A coordinated withdrawal plan avoids unpleasant surprises at retirement.

Solutions tailored to your objectives

We compare the available solutions to balance pension planning, protection, savings and taxation.

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Tax Optimization

Pillar 3a payments can be deducted from taxable income within the limits provided by legislation.

TAX BENEFIT SUBJECT TO LEGISLATION arrow_forward
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Family Protection

Coverage can protect your loved ones in the event of incapacity to earn, disability or death.

PROTECTION FOR LOVED ONES verified_user
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INVESTMENTS & SAVINGS

Investment funds, payment plans, savings and annuities depending on the product selected.

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WITHDRAWAL CONDITIONS

Third-pillar 3a capital may be withdrawn in cases provided by law. Pillar 3b generally offers greater flexibility.

Still life in a Swiss office with mechanical clock, leather folder and pen.

“A pension solution must remain adapted to your life, today and tomorrow. »

— UAG & ASSOCIÉS
A CLEAR METHOD

Questions to resolve before choosing a third pillar

  1. 01

    Preserve liquidity

    Savings are not equally accessible in pillar 3a and a flexible solution. We examine your reserves, planned expenditure and the legal grounds for withdrawal so that contributions remain compatible with your liquidity needs.

  2. 02

    Measure the tax benefit

    The tax benefit depends on taxable income, the amount contributed and your canton. It should be weighed against fees, duration, investment risk and exit terms to assess the solution as a whole.

  3. 03

    Size the protection

    An insurance component may provide a lump sum or pension in the event of disability or death. We check benefits already provided by the employer and social insurance so that this protection is sized without unnecessary overlaps.

  4. 04

    Organise succession

    The choice of beneficiaries and coordination with the matrimonial regime, succession arrangements or a property project require particular attention. A review after family and career changes keeps the solution aligned with your intentions.

When should you contribute to a pillar 3a?

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The contribution must reach the bank or insurer by 31 December at the latest to be deducted from that year’s income. A contribution made early in the year earns interest or investment returns for twelve additional months, which affects the capital built up over the long term.

Can you contribute while working part-time?

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Yes, as soon as income is subject to AVS contributions. Pillar 3a is even particularly useful with part-time work: the coordination deduction lowers the share of salary insured by the pension fund, which widens the pension gap at retirement.

Can you hold several pillar 3a accounts?

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Yes, most institutions allow it. Total annual contributions must not exceed the legal ceiling. Splitting assets across several accounts then makes it possible to stagger withdrawals over several tax years.

Do you have to choose between pillar 3a and pillar 3b?

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The two are complementary. Pillar 3a is generally used first up to the annual ceiling for the tax advantage, while pillar 3b takes additional savings, projects with a different maturity, or situations that require beneficiaries to be designated freely.

What happens to a pillar 3a if you move abroad?

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A permanent departure from Switzerland allows you to request payment of the capital. The benefit is then taxed separately, according to the rules of the canton where the pension foundation is based. A double taxation agreement may then allow a partial refund.

Can the third pillar finance a property purchase?

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Yes, for owner-occupied residential property. The capital can be withdrawn, which triggers separate taxation, or pledged, which avoids that tax but increases the amount borrowed. The choice depends on your financial capacity and the applicable rate.

What happens in the event of death before retirement?

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In pillar 3a, beneficiaries are designated in the order laid down by law, starting with the spouse or registered partner and the descendants. In pillar 3b, designation is free, subject to statutory inheritance entitlements. An insurance solution can also provide a guaranteed capital sum.

Should you invest your pillar 3a in securities?

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A securities-based 3a aims for a higher return than a savings account but is exposed to market movements. The share invested should match your time horizon until retirement, your risk tolerance and the product’s fees, which strongly influence the final outcome.

PENSIONS & LIFE INSURANCE REAL ESTATE FINANCING ALL FREQUENTLY ASKED QUESTIONS
AN INITIAL DISCUSSION

Choosing a third pillar that fits your situation

We compare bank and insurance offers on identical assumptions, fees and exit conditions included, before anything is signed.

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