Pillar 3a: The Complete Guide to Tax-Free Retirement Saving

Contribution limits, how to choose between a bank account and securities, and how to cut tax on withdrawal.

7 min read · Retirement & Pensions

Pillar 3a is the most popular way to save for retirement in Switzerland because every franc you pay in is deductible from your taxable income.

How much can you pay in?

For 2025/26 the maximum is CHF 7,258 per year if you are insured in a pension fund. Self-employed people without a pension fund can pay in up to 20 % of net income, capped at CHF 36,288. The contribution counts for the calendar year, so it must arrive by late December.

Bank account or securities?

A 3a bank account pays modest interest and carries no market risk. A 3a securities solution (fund-based) is invested mainly in shares and bonds. Over 20 years or more, equity-based 3a has historically delivered much higher returns, but values fluctuate. Choose fees carefully: total costs above 1 % per year eat a large part of the benefit.

Withdrawal and tax

You can withdraw 3a assets from five years before the ordinary retirement age, or earlier for buying a home, becoming self-employed or leaving Switzerland permanently. The withdrawal is taxed separately from other income at a reduced rate. Because the tax rate rises with the amount, splitting your money across several 3a accounts and withdrawing one per year usually reduces the total tax.

Smart habits

• Open two to five accounts.
• Pay in at the start of the year to give money more time to grow.
• Do not forget that 3a money is illiquid; keep an emergency fund outside.

Use the 3a calculator to see your tax saving and the staggered withdrawal calculator for the exit.