Invexa

Vaud tax deductions: what can I deduct in 2026?

Claire Fivaz — Thu, 18 Dec 2025 14:33:19 +0000

Summary table of tax deductions in the canton of Vaud

Deduction	Category	Maximum amount
Transportation costs (car)	Professional	0.70 CHF/km (≤15'000 km) 0.35 CHF/km (>15'000 km)
Transportation costs (public transport)	Professional	Actual subscription amount
Meal expenses	Professional	CHF 3,200 CHF 1,600 (with canteen)
Other business expenses (flat rate)	Professional	3% of net salary (min. CHF 2,000, max. CHF 4,000)
Out-of-home expenses	Professional	CHF 6,400 CHF 4,800 (with canteen)
Continuing education and training	Professional	CHF 12,000
Secondary activity	Professional	20% of ancillary income (min. CHF 800, max. CHF 2,400)
Dual careers for spouses	Professional	CHF 1,700
Social housing allowance	Housing	CHF 6,800
Building maintenance (>20 years, owner-occupied)	Housing	30% rental value or actual costs
Building maintenance (<20 years rental)	Housing	10% net income or actual expenses
3rd pillar A (employee with BVG/LPP)	Pension	CHF 7,258
3rd pillar A (self-employed without BVG/LPP)	Pension	20% net income (max. CHF 36,288)
2nd pillar (BVG) purchases	Pension	Gap amounts
Health and accident insurance premiums	Pension	CHF 5,000 (single person) CHF 9,900 (couple) +1'300 CHF per child
Interest on savings capital (debt)	Pension	CHF 1,600 (single person) CHF 3,300 (couple) +300 CHF per child
Childcare expenses	Family	CHF 15,200 per child (<14 years)
Deduction per dependent child	Family	CHF 1,000 per child
Family deduction (couple)	Family	CHF 1,300
Single-parent deduction	Family	CHF 2,800
Deduction for modest taxpayers	Family	Up to CHF 17,000 (base) + CHF 5,700 (spouse) + CHF 3,200 (single-parent) + CHF 3,500 per child
Maintenance payments	Family	Amount actually paid
Dependant	Family	CHF 3,400 (if assistance ≥ CHF 3,400)
Medical and sickness expenses	Health	Amount exceeding 5% of income
Disability-related expenses	Health	Full amount (without deductible)
Donations to charitable organizations	Other	20% middle income (code 700)
Donations to political parties	Other	CHF 10,100 maximum
Securities administration fees	Other	1.5‰ of the value of the securities
Lottery betting	Other	5% of earnings (max. CHF 5,000)

Deductions linked to professional activity

Commuting expenses

Your daily travel between home and work are deductible, whether you use public transport or your own vehicle.

For public transport: Deduct the actual amount from your annual season ticket (SBB, Mobilis, etc.). Keep your receipts.

For personal cars: The canton of Vaud applies an advantageous kilometric scale:

Outside meal expenses

If you are unable to return home for lunch for professional reasons, you can deduct a lump sum for your meals.

Standard deduction: Up to CHF 3,200 per year if your employer does not pay for your meals.

Reduced deduction: CHF 1,600 per year if your company offers a canteen or partially subsidizes your meals.

No proof is required for this deduction, which is applied automatically according to your situation.

Other professional expenses (flat rate of 3%)

The canton of Vaud authorizes a flat-rate deduction generous for all your other business-related expenses. You can deduct 3% of your net salary, with a minimum of CHF 2,000 and a maximum of CHF 4,000.

This deduction covers

No proof is required for the flat-rate amount. If your actual expenses exceed the flat rate, you can deduct them with supporting documents.

Out-of-home expenses

When your job requires you to live temporarily away from your main home (working on a distant worksite, temporary assignment), you benefit from specific deductions:

Continuing education and training costs

The expenses related to your professional training are deductible up to CHF 12,000 per year. This deduction applies if:

This includes courses, seminars and certifications, as well as ancillary costs (materials, training-related travel).

Fees for incidental activities

If you have a secondary activity in parallel with your main job, you can deduct 20% of net income generated by this activity, with a minimum CHF 800 and a maximum of CHF 2,400.

Dual careers for spouses

Couples where both spouses work can benefit from an additional deduction of CHF 1,700, provided that the lowest income (after deduction of expenses and contributions) reaches at least this amount.

Deductions for housing and property

Social housing allowance

All Vaud taxpayers can deduct expenses relating to their main home, up to a maximum of CHF 6,800 per year (code 660 on the tax return).

This deduction is intended to offset current housing expenses and applies automatically, whether you rent or own.

Building maintenance costs (for owners)

Deductible maintenance costs:

Painting and repairs
Replacement of defective installations
Roof and facade repairs
Garden maintenance
Thermal insulation
Installation of solar panels or heat pumps

Pension and insurance

Pillar 3a (restricted pension plan)

The Pillar 3a remains one of the most advantageous tax deductions in Switzerland. For 2026, the deductible amounts are:

Employees affiliated to a pension fund (LPP): CHF 7,258 maximum (federal amount 2025, subject to adjustment in 2026)

Self-employed without pension fund: 20% of net income, with a ceiling of CHF 36,288

This deduction not only allows you to reduce your taxes immediately, but also to build up savings for your retirement.

From 2026, you'll be able to buy back years of contributions, which will further reduce taxable income.

2nd pillar purchases

The pension fund buy-ins (BVG) contributions are also tax-deductible. If you have gaps in your contributions (due to years spent abroad, part-time work or career breaks), it is possible to make up for them for tax purposes. This will both increase your future retirement benefits and reduce your taxable income in the year of payment.

Warning: if you withdraw assets from 2nd pillar in the three years following a redemption, previous deductions may be cancelled.

Health and accident insurance

Health and accident insurance premiums are partially deductible in the canton of Vaud:

If you receive subsidies for compulsory health insurance, you must deduct these amounts from your premiums before calculating your tax deduction.

Interest on savings capital

Interest paid on debts (mortgages, personal loans) is deductible:

This deduction is designed to offset the taxation of the interest you receive on your savings accounts.

Family and social deductions

Deduction for dependent children

Each dependent child (minor or adult in training) is entitled to a additional deduction from CHF 1,000 in the canton of Vaud.

Childcare expenses

If you need childcare for children under the age of 14 in order to work, you can deduct up to CHF 15,200 per child for crèche, daycare, parental assistance, day mothers, etc.

Family deduction

The canton of Vaud grants an additional social deduction based on household composition:

Deduction for modest taxpayers

If your income is modest, you can benefit from an additional deduction of up to CHF 17,000 with additional amounts for spouse and children (5,700/spouse, 3,200/single parent, 3,500/child).

This deduction is progressively reduced when net income exceeds CHF 126,300. Above this threshold, the deduction is reduced by CHF 100 for each additional income bracket.

Maintenance payments

Amounts paid to an ex-spouse or for children for whom you do not have primary custody are generally tax-deductible. Keep proof of payment.

Medical and disability-related expenses

Health expenses not reimbursed by the health insurance scheme may be deducted if they exceed 5% of your intermediate income. Above this threshold, you can deduct:

For people with disabilities: Actual disability-related expenses are fully deductible, with no deductible of 5%.

Donations and contributions

Donations to charitable organizations

Donations made to institutions recognized as being of public interest (foundations, charitable, cultural or environmental associations) are tax-deductible up to a maximum of CHF 10,100 maximum.

To benefit from this deduction, ask the organization for a donation certificate. The organization must be officially registered with the Swiss tax authorities.

Donations to political parties

Contributions to political parties are also tax-deductible, provided that the party is:

Donations to individual candidates are not deductible.

Other deductions

Securities administration fees

If you have financial investments, you can deduct 1.5‰ (per thousand) of the value of securities and investments declared under code 410.

This flat-rate deduction covers the costs of managing your portfolio, without the need for supporting documents.

Lottery betting

Taxable lottery winnings are subject to a deduction of 5% of the winning amount, with a ceiling of CHF 5,000 per taxable gain.

This deduction is intended to compensate for the bets used to obtain the winnings.

Tips for optimizing your deductions

1. Keep all your receipts

Even if certain deductions are made on a flat-rate basis, always keep your invoices, certificates and supporting documents for at least 10 years. In the event of a tax audit, you'll need to be able to prove your expenses.

2. Compare flat-rate and actual expenses

For business expenses and building maintenance, always compare the lump-sum amount with your actual expenses. If you have incurred exceptional expenses (major works, expensive training), actual expenses may be more advantageous.

3. Plan your BVG & 3a buy-ins

If you are planning to buy into your pension fund, spread the purchases over several years rather than making them all at once. This maximizes the tax advantage by avoiding excessive growth.

Buy into 3a from 2026 (for the year 2025).

4. Anticipate building work

If you're a homeowner planning major maintenance work, think about the best time to carry it out for tax purposes. A high-income year may be a good time to maximize the impact of the deduction.

5. Declare your childcare expenses

Many parents forget to declare their childcare costs in full. With a ceiling of CHF 13,000 per child, this deduction can represent a substantial saving.

6. Take advantage of the 3rd pillar until December 31

For your Pillar 3a payment to be deductible for the current tax year, it must be made before December 31. Don't delay, as some institutions have processing deadlines.

When should you file your Vaud tax return?

The Vaud tax return must be returned to before March 15, 2026 for the 2025 tax year. You can request an extension if necessary.

In the event of a major change in circumstances (marriage, divorce, birth, change of job), don't forget to adjust your deductions accordingly.

Conclusion

The Vaud tax system offers many ways to legally reduce your tax burden. From the simple deduction of transport costs to strategic purchases into your pension fund, every deduction counts.

The most important thing is to know your rights, keep your supporting documents and complete your tax return with care. If your situation is complex (multiple incomes, property ownership, substantial assets), don't hesitate to consult a tax advisor to optimize your tax return.

By correctly applying all the deductions to which you are entitled, you can achieve significant savings on your annual tax bill.

Self-Employed Retirement in Switzerland: Calculation, Contributions and Entitlements

Claire Fivaz — Wed, 17 Dec 2025 13:11:09 +0000

What kind of pension is available to self-employed workers in Switzerland?

Preparing for retirement as a self-employed person in Switzerland requires a thorough understanding of the pension system. Unlike employees who benefit from a structured framework through their employer, self-employed workers must actively manage their retirement provisions.

Between mandatory contributions, voluntary affiliations, and tax optimizations, the path to a comfortable retirement requires foresight and strategy. This article guides you through the essential mechanisms to properly prepare your retirement as a self-employed person in Switzerland.

The Swiss pension system for the self-employed

Switzerland has built its pension system on three complementary pillars. For the self-employed, the particularity is that they are automatically covered only by the 1st pillar, unlike employees who are also mandatorily covered by the 2nd pillar.

1st pillar: the compulsory basis for your retirement

From the start of your self-employed activity, you must register with the AHV (Old-Age and Survivors’ Insurance). This registration forms the foundation of your social protection and will largely determine the amount of your retirement pension.

How do AHV contributions work for the self-employed?

As a self-employed person, you are responsible for the entire payment of your contributions, without any employer participation. The contribution rate amounts to 10% of your annual net income, in addition to the AI (Disability Insurance) and APG (Loss of Earnings Compensation) contributions. A sliding scale system applies for incomes below CHF 58,800 per year in 2025, helping to reduce the burden for start-up activities or modest incomes.

These contributions are calculated based on your assessable income. It is crucial to report your income correctly, as every year of contributions counts toward the final calculation of your pension. A missing or underreported year can significantly reduce the amount of your future retirement benefits.

How much AHV pension can I expect?

In 2025, the AHV pension reaches a maximum of CHF 2,520 per month, while the minimum pension is CHF 1,260 per month. To qualify for the maximum pension, you must have contributed without interruption throughout your working life, usually 44 years, and achieved an average annual assessable income of CHF 90,720 (see scale 44).

The exact amount of your pension depends on three main factors: the duration of your contributions, the amount of income on which you contributed, and any credits for childcare or caregiving. Each missing year results in a reduction of about 2.3% of the full pension. Thus, if you contributed for 30 years instead of 44, your pension will be proportionally reduced.

2nd pillar: a strategic option for the self-employed

Voluntary affiliation to occupational pension plans is done through a collective foundation or the LPP supplementary institution if no other solution is available through your profession. This puts you in a situation comparable to employees, with one major difference: you bear the entire contribution yourself, combining both the employer and employee portions.

In 2025, you can ensure maximum annual salary of CHF 64,260 under the mandatory BVG/LPP scheme. Contributions are based on your age, starting at 7% for the youngest and up to 18% of insured salary for older age groups.

Pension or lump sum: how do I recover my BVG/LPP rights?

At retirement, you will need to choose between receiving your LPP assets as a life annuity or a lump sum. The annuity offers maximum security with a guaranteed income until your death, generally calculated with a conversion rate of around 6% of your total assets. The lump-sum withdrawal, on the other hand, gives you access to all your savings, with favorable separate taxation, but requires you to manage these funds yourself to secure your retirement.

This decision depends on many factors: your life expectancy, your ability to manage a large capital sum, your family situation, and your other sources of retirement income.

Pillar 3a: the freedom to build your retirement

In 2025, if you are not affiliated with the second pillar, you can contribute up to CHF 36,288 per year to your pillar 3a (20% of your net income).

This amount is fully deductible from your taxable income. If you are affiliated to a second pillar, the ceiling drops to CHF 7,258, in line with that for salaried employees.

Pillar 3a offers a wide range of investment options: bank accounts, insurance contracts, or index fund investment solutions. Unlike the second pillar, you retain full control over your investment choices and can adjust your strategy according to market developments and your risk profile.

The capital accumulated in pillar 3a can be withdrawn in certain situations before retirement: purchase of your primary residence, starting a self-employed activity, permanently leaving Switzerland, or buying back LPP contribution years. At retirement, withdrawal is possible five years before the standard AHV retirement age, with favorable separate taxation.

Pillar 3b: retirement without constraints

The pillar 3b, or flexible pension plan, complements the range of available solutions without contribution limits or binding legal framework. Although contributions generally do not benefit from tax deductions (except in certain cantons), pillar 3b offers other advantages, notably beneficiary designation outside the estate and exemption from taxes on the contributed capital.

Optimization strategies for a comfortable retirement

Building a solid retirement as a self-employed person requires a strategic approach tailored to your situation and income.

The winning combination: 2nd and 3rd pillars

For self-employed individuals whose income allows, the combination of the second and third pillars offers the best of both worlds. The second pillar provides the security of a life annuity and high deductible contributions, while pillar 3a offers flexibility and higher return potential through active management of your savings.

This strategy allows you to maximize tax deductions while diversifying your sources of retirement income. In doing so, you build a solid foundation with the LPP, supplemented by 3a capital.

Anticipate early to benefit from the compounding effect

Time is your best ally in building your retirement. The earlier you start contributing, the more the compounding of interest works in your favor. Regular contributions to pillar 3a from the start of your self-employed activity can generate a substantial capital over 30 or 40 years, even with modest amounts.

As far as the second pillar is concerned, early enrolment helps to avoid large gaps that would require costly buy-ins later in your career. Even if your income is modest at the outset, maintaining a minimum contribution creates beneficial continuity when calculating your entitlements.

Repatriate and invest your BVG assets

Don’t forget to transfer your LPP assets to a vested benefits account. Otherwise, they will remain with the LPP supplementary foundation, where returns are very low. We also recommend carrying out a search with the Second Pillar Central Office to locate any forgotten assets.

Adapt your strategy to changes in your revenues

A self-employed person’s pension plan must evolve according to the growth of their business. In the early years, focus on pillar 3a with regular contributions, even modest ones. Once your business is stable and your income increases, consider joining the second pillar to benefit from higher tax deductions and secure a life annuity.

You can take advantage of years of high profitability to make BVG/LPP buy-backs or maximize your 3a payments, thus creating a tax and asset reserve for less favorable periods.

Invexa helps you plan your retirement

As a self-employed person in Switzerland, your retirement requires active and forward-looking management, but in return offers unparalleled flexibility to build a tailored protection plan. Between the mandatory foundation of the first pillar, the strategic options of the second pillar, and the freedom of the third pillar, self-employed individuals have all the necessary tools to build a comfortable retirement, provided they start early enough and maintain a disciplined savings habit. At Invexa, we help you develop a complete and customized retirement strategy.

Pillar 3b: Everything You Need to Know About Unrestricted Pension Plans

Claire Fivaz — Sat, 13 Dec 2025 15:24:11 +0000

What is Pillar 3b?

Pillar 3b, known as "unrestricted pension provision", is the part of the optional of the private pension plans in Switzerland and supplements the pensions guaranteed by the 1st and 2nd pillars.

Unlike the pillar 3a, it does not impose no limits annual instalments, and allows total capital availability at any time, unconditional related to age or use (self-employed, property purchase, personal project, etc.).

Pillar 3a or pillar 3b?

Here are the main ones differences between pillar 3a and pillar 3b:

Retirement planning

Free savings

Employed persons affiliated to the AVS

Open to all

Non-deductible (except life insurance in Geneva and Fribourg)

Limited to some cases: retirement, buying a home, independence, moving to Switzerland...

Withdrawal possible at any time

Anytime

Bank account, funds, mixed life insurance

Traditional savings, investments, life insurance, annuities, funds, real estate, etc.

Beneficiaries defined by law, strict order

Free beneficiaries

What products are available in 3b?

The flexibility of the 3rd pillar B translates into great freedom in choosing the savings vehicle — life insurance, bank account, investment funds, or real estate — as well as in the duration and amount of contributions. The 3b pillar also allows you to freely designate beneficiaries in the event of death, making it an ideal instrument to supplement retirement income while maintaining an accessible financial reserve for other goals.

Tax benefits of 3rd pillar B

Although contributions to the 3rd pillar B are not as strongly incentivized as in pillar 3a through tax deductions, the 3b pillar nonetheless offers several tax advantages.

Tax-free capital on withdrawal

The payout of capital from the 3rd pillar B (including surpluses and returns) is exempt from lump-sum benefits tax at the time of withdrawal.

In the case of a single premium (insurance), it will also be tax-exempt if it meets the conditions of the pension character. That is to say:

Taxation of life annuities

Since January 1, 2025, life annuities taken out under the 3b pillar are subject to income tax on 4% of the amount (down from 40% in 2024).

However, participation in surpluses is taxed at a rate of 70% (income tax).

Tax deductions

The cantons define the amount of deductible annual contributions. In some cantons, a Pillar 3b is not deductible at all, whereas in the canton of Geneva it will be in 2025, you can deduct up to:

In the canton of Fribourg, the following deductions are available:

These deductions apply only when subscribing to a 3b pillar in the form of insurance, and not through a bank.

How is Pillar 3b capital taxed?

The capital in the 3b pillar is subject to the wealth tax throughout the entire duration of the contract. Wealth is taxed above a certain threshold and depends on the canton. In Geneva, the wealth tax applies from CHF 87,632, while in the canton of Vaud, it starts at CHF 58,000.

3rd pillar B: for whom?

The 3rd Pillar B can be adapted to the following profiles:

Where can I take out a Pillar 3b?

You can take out a 3b pillar either as insurance or with a financial institution. The decision will depend on your needs (protection of loved ones, retirement planning, returns, etc.).

What solutions exist?

Several models exist depending on your objectives. You’ll find single-premium life annuities, which allow you to pay a lump sum once in exchange for a guaranteed lifetime income — ideal if you want to secure a stable retirement supplement without worrying about market fluctuations. Conversely, periodic-premium contracts offer the flexibility to spread your payments over several years while gradually building up your capital.

For those seeking more dynamic growth, solutions linked to the financial markets (investment funds, dedicated securities accounts, or unit-linked contracts) allow you to invest your savings in stocks, bonds, or ETFs, offering higher return potential — but also exposing your capital to market fluctuations. Finally, multi-support life insurance products combine a protection component (guaranteed capital) with an investment component (variable-yield funds), providing a balance between security and performance. The choice ultimately depends on your time horizon, risk tolerance, and liquidity needs.

We recommend

Subscribing to a 3b pillar requires careful consideration, as it is a flexible solution whose characteristics vary greatly depending on the provider. Before any subscription, it is essential to analyze your financial profile, your objectives, and your risk tolerance in order to identify the most suitable plan.

The returns, fees, and guarantees can vary significantly from one contract to another and affect the overall performance of your savings in the long term.

Frequently asked questions

What is Pillar 3b pension provision?

The 3b pillar is the free pension plan in Switzerland, part of the 3rd pillar.

Unlike pillar 3a, it has no contribution ceiling, allows withdrawals at any time, and offers a free choice of beneficiaries. You can invest in various products: life insurance, savings accounts, funds, or real estate. Tax deductions are limited, but withdrawals are tax-exempt.

How many Pillar 3b policies can a married couple hold?

Each spouse can freely subscribe to one or more 3b pillar contracts; there is no regulatory limit per person or per household.

As a cross-border commuter, do I have to declare my Pillar 3b to French tax authorities?

Yes, capital and gains must be reported on your French tax return if they generate taxable income or are included in the IFI calculation, but they are not deductible.

Are Pillar 3b premiums tax-deductible in Geneva?

Yes, up to CHF 2,232 for a single person and CHF 3,348 for a married couple.

Can I freely withdraw money invested in a Pillar 3b?

If the contract allows, you can withdraw your funds at any time without restriction or penalty.

What's the difference between a 3a and 3b pillar?

The Pillar 3a is capped, tax-deductible in Switzerland, and withdrawals are subject to strict conditions.

The Pillar 3b has no ceiling or automatic tax advantage; withdrawals and contributions are completely free. In addition, there is a wider range of investment options.

2nd Pillar Buyback: Complete Guide and 2025 Tax Deduction

Claire Fivaz — Fri, 12 Dec 2025 06:00:04 +0000

What is a 2nd pillar purchase?

A buy-in to the 2nd pillar involves voluntarily paying a sum into your pension fund to fill gaps in your retirement coverage. These gaps may be due to periods without affiliation (studies, time abroad, career breaks) or a change to a pension plan offering higher benefits.

Each pension institution sets the maximum buy-in amounts according to its regulations and your personal situation: age, insured salary, contribution period, and accrued benefits.

Why buy back my 2nd pillar?

1. Improving performance

The first advantage of a purchase is the increase in retirement capital. This capital will influence..:

The earlier you make a buy-in during your working life, the more the amounts contributed will benefit from interest and capitalization offered by the pension fund. This can result in a higher pension of several hundred francs per month at retirement.

2. Tax benefits

Amounts paid as part of a buy-in are fully deductible from taxable income at the federal, cantonal, and municipal levels (Art. 33 LIFD).

3. Flexibility in tax planning

Unlike compulsory contributions, buy-backs are optional and modular:

Tax advantages of buying into your pension fund

Buying into the 2nd pillar offers exceptional tax advantages, making it the preferred tax optimization tool for middle- and high-income Swiss taxpayers.

Full, unlimited tax deduction

Amounts paid as part of a buy-in are fully deductible from taxable income at the federal, cantonal, and municipal levels (Art. 33 LIFD).

This deduction applies in the year of the payment and appears directly on your tax return.
Major advantage compared to the 3rd pillar: While the pillar 3a caps the tax deduction at CHF 7,258 for employees (2025), the buy-in into the 2nd pillar has no annual limit. Your buy-in ceiling depends solely on your pension gaps, which may reach CHF 50,000, CHF 100,000, or even more depending on your situation.

This fundamental difference makes the LPP buy-in the most effective tax-saving instrument for taxpayers who have already maxed out their 3rd pillar.

Calculating real tax savings

The tax savings generated by a buyback depend on three main factors:

1. Your marginal tax rate: The higher your income, the more you are taxed in the higher brackets. If you buy back your income, you'll be taxed in the lower brackets, maximizing your savings.

2. Your canton of residence: Tax rates vary considerably between cantons. Geneva and Vaud apply higher rates than Valais or the canton of Zug, which increases potential tax savings.

3. Your family situation: Married couples, single-parent families and singles benefit from different rates.

In practice, the tax saving generally represents 25% to 45% of the amount bought back.

A concrete example of tax savings

CHF 120,000

CHF 90,000

~CHF 32’000

~CHF 21,000

CHF 11,000 (37% buyback)

This example is indicative and may vary according to social deductions, professional expenses and commune of residence.

Optimization strategies

Spread redemptions over several years

Rather than making a large-scale redemption all at once, it is often more advantageous to spread the payments over 2 to 4 years. This strategy allows you to:

Spread redemptions over several years

The timing of a buyback has a direct impact on its tax efficiency:

Year of bonuses or exceptional income: A buyback allows you to compensate for a one-off increase in income and avoid falling into a higher bracket.
Year of taxed capital gains: Ideal for partially neutralizing the taxation of a property sale
Before a change of canton: If you're moving to a lower-tax canton, make your buy-backs before you leave to maximize the deduction.

Coordination with Pillar 3a

The optimal strategy generally consists of:

This approach makes it possible to combine the benefits of both pillars while maximizing the overall tax deduction.

From 2026 (for fiscal year 2025), it will also be possible to make Pillar 3a purchases.

Beware of tax traps

If you are considering an early withdrawal (property purchase, leaving Switzerland, becoming self-employed), avoid any buy-in during the previous 3 years. The tax authorities would retroactively cancel the deduction, forcing you to repay the tax savings along with default interest.

How much can I buy back?

The maximum amount you can buy back is determined by the difference between your retirement savings theoretical and your credit current in the pension fund. This difference represents your pension gaps, i.e. the capital you would have accumulated if you had always been affiliated to the same fund, with a constant and uninterrupted salary.

The redeemable amount is shown on your pension certificate:

Disadvantages of a buyback

1. Blocking funds

If you are considering withdrawing your 2nd-pillar assets in the near future, particularly for:

It is imperative that you have not made a buy-in within the previous 3 years. Otherwise, the tax authorities may retroactively claim the taxes saved through that buy-in, nullifying any tax benefit. However, this waiting period does not apply if you receive your retirement as an annuity. Therefore, if a withdrawal is planned in the medium term, postpone the buy-in or make it at least three years in advance.

2. Risk of under-coverage

A buy-in only makes sense if the pension fund is financially sound, meaning it has a coverage ratio above 100%. If the fund is underfunded (below 100%), it may implement restructuring measures that also affect the buy-in amounts (reduced benefits, lower conversion rate, etc.).

It is therefore advisable to ask your employer or the insurance company directly for the current level of cover, and to avoid buying out in the event of a persistent financial imbalance.

3. Limited impact on survivors' pensions

In many pension plans, disability and survivors' pensions are calculated on a lump-sum basis in percentage of the insured salary, not the accumulated capital. This means that the purchase will have no effect on these benefits.

If your priority is protecting your loved ones, consider a 3rd pillar or a complementary life insurance, which may be better suited.

Buyback in the event of divorce

In Switzerland, the law provides that in the event of divorce, occupational pension assets (2nd pillar) acquired during the marriage must be fairly divided (Art. 122 CC). This buy-in is not subject to the 3-year waiting rule for withdrawals. In short, this means:

The spouse whose LPP capital was reduced following the transfer may, if they wish, buy back the transferred amounts in order to restore their level of pension coverage.

Buy back years of contributions with a Pillar 3a withdrawal

The Swiss pension system allows you to use the assets accumulated in your pillar 3a to finance a buy-in to your pension fund (2nd pillar). This operation is tax-neutral and can be carried out until the statutory retirement age, or up to 5 years later if you are still working.

You can transfer all or part of your 3a capital to your pension fund, provided that the balance does not exceed the maximum buy-in amount. However, you will need to pay capital benefits tax (one-fifth of the regular tax rate, reduced and separate from income tax).

Pension fund purchase VS 3a contribution

A buy-in to the 2nd pillar allows you to fill contribution gaps with substantial amounts and offers a very advantageous tax deduction. However, any lump-sum withdrawal within three years following a buy-in may result in the loss of the tax benefit.

The 3rd pillar A, on the other hand, is more flexible. It allows for regular retirement savings with an annual deduction limit. It is accessible to everyone, including the self-employed, and offers early withdrawal options similar to the 2nd pillar. It exists in the form of accounts or funds, with higher return potential than the 2nd pillar but also greater risk. If you have already contributed the maximum to your 3rd pillar A, it is wise to make buy-ins to your pension fund.

Can I increase my buy-in potential?

If your new employer offers a more generous pension plan, your buy-in potential automatically increases. You can then buy in the difference between the benefits of the old and the new plan.

An increase in your insured salary raises the basis for calculating your contributions, as well as the maximum theoretical capital you could have accumulated. This expands the possible buy-in margin.

In basic plans, often only a percentage of the salary is insured (for example, up to CHF 100,000). If you earn CHF 200,000 but only CHF 100,000 is covered in the plan, you leave an unused buy-in potential. For incomes above CHF 132,300 (in 2025), it is possible to set up a separate supramandatory plan for executives or a 1er plan.

EPL repayment: Prerequisite for deductible redemption

If you have already used your 2nd pillar to finance the purchase of your primary residence through the home ownership encouragement (EPL), this situation directly affects your ability to make new tax-deductible buy-ins.

The mandatory prepayment rule

As long as you have not fully repaid an early EPL withdrawal, you cannot make tax-deductible buy-ins into your 2nd pillar. This rule is designed to prevent insured persons from simultaneously using their pension assets for home ownership while benefiting from tax advantages through buy-ins.

Specifically, if you withdrew CHF 80,000 from your 2nd pillar in 2015 to purchase your home, you must repay these CHF 80,000 before making a buy-in that will be recognized as tax-deductible by the tax authorities.

How EPL refunds work

There are two ways of repaying an advance withdrawal for the purchase of a home:

Voluntary repayment: You can voluntarily repay all or part of the withdrawn amount at any time, up to 3 years before the statutory retirement age (currently up to 62 for men and 61 for women). The repayment can be:

Frequently asked questions

Are 2nd pillar purchases tax-deductible?

Yes, buy-ins into the 2nd pillar are fully deductible from taxable income at the federal, cantonal, and municipal levels, in accordance with Article 33 of the Federal Direct Tax Act (LIFD). This deduction applies without an annual limit, unlike pillar 3a. The buy-in amount directly reduces your taxable base in the year of payment.

For example, if you earn CHF 100,000 and buy back CHF 25,000, your taxable income falls to CHF 75,000, generating immediate tax savings of between CHF 6,000 and CHF 11,000, depending on your canton and family situation.

What are the real tax savings of a 2nd pillar purchase?

The tax saving generated by a buy-in typically represents between 25% and 45% of the amount contributed, depending on three main factors: your marginal tax rate, your canton of residence, and your family situation. The higher your income, the greater the savings, as you are taxed in higher brackets.

Does the tax deduction apply in the year of purchase or the following year?

The tax deduction applies in the calendar year in which you make the payment. If you pay CHF 30,000 in November 2025, you will deduct this amount in your 2025 tax return, which you will file in spring 2026. To optimize your deduction, ensure that the payment is actually credited to your pension fund account before December 31.

Do I have to repay an EPL early withdrawal before I can deduct a new redemption?

Yes, absolutely. If you have already made an early withdrawal for the home ownership encouragement (EPL), you must fully repay this amount before being allowed to make new tax-deductible buy-ins. As long as the repayment is not complete, any buy-in you make will not be recognized by the tax authorities.

Who can make a buy-in?

Anyone affiliated with a Swiss pension fund who has a contribution gap can make a buy-in. Limitations exist for individuals who are affiliated with a Swiss pension fund for the first time.

Can my employer force me to make a buyback?

No, buy-ins into the 2nd pillar are always voluntary. Your employer cannot force you to make a buy-in. These are your personal funds that you voluntarily contribute to your pension fund to cover your pension gaps.

Warning: Do not confuse voluntary buy-ins with remedial contributions that some underfunded pension funds may temporarily impose. These remedial contributions are mandatory and shared between employer and employee, but they are also tax-deductible.

Is the buy-in taxed on exit?

Yes, like any 2nd-pillar assets, it is taxed at the time of withdrawal (either as a lump sum or included in the pension). However, the taxation remains favorable because a reduced rate applies for lump-sum withdrawals.

Can I use Pillar 3a to finance a buyback?

Yes, but:

Withdrawal from 3a is imposed immediately.
This transfer is tax-neutral, unless you have a high income allowing a real deduction.

Repurchase LPP/BVG with a 3rd pillar

Claire Fivaz — Wed, 10 Dec 2025 11:04:58 +0000

Can you use your 3rd pillar to repurchase LPP/BVG benefits?

Yes, it is perfectly legal. Article 3a of the Ordinance on Tax-Deductible Contributions (OPP 3) explicitly allows early withdrawal from the 3a pillar to finance a buy-in to your pension fund.

This is considered a valid early withdrawal reason, just like purchasing a primary residence or starting self-employment. You do not need to wait until retirement to unlock your 3a if you use it to cover gaps in your 2nd pillar pension.

How does an LPP/BVP repurchase work with Pillar 3a?

Step 1: Check your buy-in potential

Ask your pension fund for an updated provident certificate. This document indicates the maximum amount you can buy back, i.e. the difference between your theoretical and current credit balance.

Step 2: Prepare the 3a pillar withdrawal

Contact your bank or insurance provider managing your 3a pillar. Inform them that you wish to make an early withdrawal for a pension fund buy-in (LPP). You will need to provide the certificate from your pension fund confirming your buy-in potential.

Step 3: Partial or total withdrawal

You can withdraw all or part of your 3a pillar, but beware: for a partial withdrawal, the amount must fully cover your pension gap.

For example, if your LPP gap is 40,000 CHF and you have 100,000 CHF in your 3a pillar, you can withdraw only 40,000 CHF. You cannot withdraw 20,000 CHF to cover just part of the gap.

Step 4: Payment to the pension fund

The capital is transferred from your 3a account to your pension fund, which adds it to your retirement capital. This will increase your retirement benefits.

Up to what age can this transfer be made?

You can use your 3a pillar for an LPP buy-in up to the normal retirement age (currently 65). If you continue working beyond that, you still have an additional 5 years to complete this transaction.

Be aware that if you have a 3a insurance policy maturing within the 5 years before your retirement, this transfer will no longer be possible.

What is the taxation for this transaction?

A buy-in financed through the 3a pillar is fiscally neutral. In practice, this means that:

This tax neutrality fundamentally distinguishes a 3a-financed buy-in from a standard cash buy-in. With a cash buy-in, you benefit from the full tax deduction without any upfront taxation, generating a substantial tax saving.

The transfer from 3a to the 2nd pillar therefore offers no direct tax advantages. The advantage lies elsewhere.

So why use your Pillar 3a for a buyback?

Making an LPP repurchase in cash requires substantial funds, sometimes tens of thousands of francs. If you don’t have this immediate savings capacity but have a significant 3a capital built over the years, a transfer becomes a practical solution.

The 2nd pillar generally offers better protection than the 3rd pillar in case of disability or death. The disability and survivor pensions from the 2nd pillar are automatic and often more advantageous than simple death coverage in a 3a policy.

Pillar 3a or pillar 3b: what's the difference?

The difference between 3a and 3b is as follows:

The 3b pillar corresponds to your flexible savings: savings accounts, securities, cash. You can, of course, use it at any time to make an LPP buy-in, without any restrictions or special formalities.

The advantage of the 3b pillar is twofold: it remains accessible at any time and a buy-in made with these funds generates a full tax deduction. It is therefore the optimal solution from a fiscal standpoint, but it requires that you have such liquidity available.

The Pillar 3a, which is blocked until retirement unless there are legal grounds for doing so, requires a specific legal framework in order to be mobilized. Without Article 3a BVV 3, your 3a capital would remain inaccessible for a BVG purchase. The legislator created this gateway to enable this capital to be reallocated to the 2nd pillar.

The advantage of this mechanism lies in the early release of capital that would otherwise be tied up, not in any kind of "risk management". tax advantage.

When to opt for a cash repurchase?

If you have sufficient liquidity or flexible savings (3b pillar), a standard cash buy-in remains preferable. You then benefit from the full tax deduction, which can represent a tax saving of 30% to 40% of the buy-in amount, depending on your marginal tax rate.

For example, a 50,000 CHF buy-in made in cash can generate a tax saving of 15,000 to 20,000 CHF for a taxpayer with a high marginal rate. The same buy-in financed through the 3a pillar provides no tax saving.

A purchase via 3a is therefore only justified if you have no other option for raising the necessary funds, or if you wish to reorganize your pension provision by concentrating your assets in the 2nd pillar.

Check the financial health of your pension fund first

Before any buy-in, check your pension fund’s coverage ratio. A ratio below 100% indicates financial difficulties. In the case of persistent underfunding, your fund could implement remedial measures that would affect all assets, including those from buy-ins.

If your fund has a worrying coverage ratio, it's best to keep your capital in Pillar 3a, where it remains protected and accessible according to the legal grounds for withdrawal.

3a buyback vs. cash buyback: comparison table

Full tax deduction

Legal grounds for withdrawal required

Immediate

Low (locked-in capital)

High

Lack of liquidity, pension reorganization

Maximum tax optimization

The choice between these two options therefore essentially depends on your cash availability and your medium-term wealth objectives.

Conclusion

This operation is fiscally neutral: there is no tax on the 3a withdrawal, but also no tax deduction for the buy-in. It therefore offers no direct tax advantage, unlike a standard cash buy-in.

This operation is tax-neutralNo tax on 3a withdrawals, but no tax deduction for redemptions either. There is therefore no direct tax advantage, unlike a classic cash redemption.

Its main advantage lies in the ability to mobilize significant 3a capital when you lack the liquidity for a standard cash buy-in, or when you want to focus your pension into the 2nd pillar to benefit from better risk coverage.

Before proceeding, check the financial health of your pension fund, assess your medium-term flexibility needs, and consider whether a cash buy-in might be more tax-efficient if you have the necessary funds.

Frequently asked questions

Can I really use my Pillar 3a for a BVG/LPP purchase?

Yes, it's perfectly legal. Article 3a of the Ordinance on Tax-Allowed Deductions (BVV 3) expressly authorizes early withdrawal from Pillar 3a to finance a purchase from your pension fund. This is an official reason for early withdrawal, just like buying a home or becoming self-employed.

What's the difference between using my pillar 3a and my pillar 3b for a buyback?

Pillar 3b (free savings) can be accessed at any time, and a purchase made with these funds generates a full tax deduction. Pillar 3a is normally blocked until retirement, but the legislator has created a specific exception for BVG purchases. However, buying into 3a is tax-neutral (no tax on the withdrawal, but no deduction either).

How much can I withdraw from my Pillar 3a for a buyback?

You can withdraw all or part of your Pillar 3a. In the case of partial withdrawals, the amount must correspond to your entire pension shortfall. For example, if your LOB shortfall is CHF 30,000, you can withdraw exactly CHF 30,000 from your 3a, no less. If your shortfall is greater than your 3a credit, you can withdraw the entire amount.

How can I find out my buyback potential?

Your purchase potential is shown on your pension certificate, which you can request from your pension fund. This amount represents the difference between your theoretical retirement savings (what you would have if you had always contributed the maximum) and your actual retirement savings.

Can my buyback potential increase?

Yes, your buy-back potential increases if you switch to a more generous pension plan, if your insured salary increases, or if you make no contributions for a period (career break, reduced activity).

How do I make a buyback using my Pillar 3a?

Ask your pension fund for an updated pension certificate
Contact your bank/insurance company managing your 3a
Provide proof from your pension fund and request the transfer
The capital is transferred directly from your 3a plan to your pension fund.
Your pension fund adds this amount to your retirement assets

3rd Pillar Generali: Complete Comparison of 3a/3b Solutions in 2025

Claire Fivaz — Tue, 09 Dec 2025 09:43:45 +0000

What is the 3rd pillar?

Before exploring the products, it's crucial to understand the distinction between Pillar 3a and Pillar 3b, as this difference will determine your entire pension strategy.

The 3a pillar, also called tied pension, is the most tax-advantageous option. Contributions are deductible from taxable income, which helps reduce your annual tax burden. In 2025, an employee with a pension fund can deduct up to 7,258 CHF, while a self-employed person without a 2nd pillar can contribute up to 20% of their net income, with a ceiling of 36,288 CHF. During the entire contract period, the accumulated capital is not subject to wealth tax, and upon retirement withdrawal, it benefits from separate and reduced taxation. This favorable taxation comes with some constraints: the capital remains locked until retirement, with a few exceptions such as purchasing a primary residence or permanently leaving Switzerland.

The 3b pillar, or flexible pension, offers complete flexibility. You can contribute any amount you choose, without a ceiling, and withdraw your capital at any time according to your needs. This freedom comes at the cost of no annual tax deduction, although the capital is generally exempt from tax at the time of withdrawal. The 3b also allows you to freely designate your beneficiaries, unlike the 3a, which imposes a legal order of succession.

Generali's 3rd pillar solutions

Generali structures its pension offering around several product categories, each designed to meet distinct objectives.

Pillar 3a Flex Digital: the online solution

The 3a Flex Pillar represents Generali’s digital banking solution. Fully managed online through the client portal, this product allows you to make contributions with complete flexibility, as much and whenever you want, up to the annual tax-deductible limit.

In case of loss of earnings, Generali contributes up to 3,000 CHF per year to your 3a pillar, ensuring the continuity of your savings. This product is particularly suitable as a complement to an existing pension solution or as a standalone option for your 3a pillar.

Combined savings and protection solutions

The Previdenza Pension and Previdenza Flex Pension are unit-linked mixed insurance policies with periodic premiums. These solutions allow you to save regularly while benefiting from protection in case of death or disability. The Flex variant offers greater flexibility in managing the balance between security and returns.

Capital accumulation with death cover (periodic premiums)

The Scala Pension Insurance and Flex Pension Insurance represent two options for those who wish to build capital while ensuring a death benefit for their loved ones. Available in both 3a and 3b, these mixed products always include death coverage.

Scala offers a structured approach with a guaranteed death benefit, while Flex allows you to freely allocate premiums between a security account (guaranteed) and a growth account (invested in funds). Coverage of premiums in case of loss of earnings remains optional for both products.

Pure savings solutions (capitalization)

The Performa Pension Insurance stands out for its 100% savings focus, without automatic death coverage. This capitalization product includes, by default, coverage of premiums in case of loss of earnings.

Specifically, if you become disabled, Generali continues to pay the contributions on your behalf, thus ensuring the continuation of your savings. This feature makes Performa an attractive option for those who want to focus on capital accumulation while protecting against income loss. Available in both 3a and 3b, this product is particularly suitable for individuals who start their pension planning early.

Risk coverage solutions

For those seeking only a pure risk life insurance, Generali offers PREVISTA, a term life insurance with either increasing or decreasing insured capital. This solution allows the death coverage to be adapted to evolving needs (for example, decreasing capital in parallel with mortgage repayment).

The Loss of Earnings Insurance complements this offering by providing specific protection against income loss, with the option for premium waiver.

Provisions for children (3b only)

The KIDS Child Pension allows you to plan for your children’s future. Available only in 3b pillar, this product offers either an income in case of loss of earnings or a unit-linked mixed insurance with periodic premiums. This solution enables parents to build capital for their child while providing financial protection.

Investment options: available funds

Generali offers several investment plans to adapt the level of risk and return to your profile. The Multi Index 100 fund, with an equity allocation of 89.3%, has historically been the best performer, with an average annual return of 8% since its launch in 2016. Its TER (Total Expense Ratio) of 0.26% remains competitive. For 2024, this fund has recorded a year-to-date performance of 16.0%.

ChatGPT said: The other Multi Index funds (40, 30, 20, 10) offer decreasing equity allocations for more conservative profiles. Generali also offers Tomorrow Invest 100, a sustainable investment plan focused on Swiss companies committed to an ESG (environmental, social, and governance) approach.

Beyond these strategic plans, the insurer offers a full range of funds: GENERALI Short Term Bond Fund, Bond Fund CHF, Equity Fund Switzerland, ESG Equity Fund, Multi Asset Fund, and several other options allowing for geographic and sector diversification.

Pricing structure and fees

In the case of unit-linked life insurance, fees depend in particular on the age at which you take out the policy. The later you take out a policy, the higher the risk and closing costs, since the probability of a claim increases with age. A policy taken out at 25 will always cost less than an identical policy taken out at 45. This pricing structure makes it particularly advantageous to start saving early, even for modest amounts.

The fund management fees vary depending on the chosen plan, with TERs ranging from 0.26% for Multi Index 100 to higher levels for certain actively managed funds. These fees directly affect the net return of your savings over the long term.

Generali 3rd pillar comparison

Digital banking

Yes (contribution CHF 3,000/year)

Combined insurance

Yes (guaranteed)

Optional

Capitalization

Yes (included)

Flexible endowment insurance

Yes (guaranteed)

Optional

Combined insurance

Yes

Variable

Combined insurance

Yes

Variable

Single premium (3b)

Yes

Not applicable

Pure risk (3b)

Yes (temporary)

Not applicable

Junior provident scheme (3b)

Variable

Compare 3rd pillar products

Receive offers along with an objective assessment within 24 hours: advantages, limitations, and relevance according to your age, professional situation, and savings goals.

Conclusion

Generali indeed offers a wide range of solutions for the 3rd pillar in Switzerland, ranging from simple digital products to mixed insurance policies. Each product addresses needs such as pure savings, family protection, management flexibility, or a combination of multiple objectives.

Before subscribing, it is recommended to compare several market offers and consult an independent financial advisor to ensure that the chosen solution truly fits your personal situation and long-term goals. Subscribing to a 3a pillar represents a commitment over several decades; taking the time to choose wisely is an investment in itself.

Frequently asked questions

Can I combine several Generali products?

Yes, it is possible to subscribe to multiple 3rd pillar contracts, within the annual tax-deductible limit for 3a. For example, you could combine a 3a Flex Digital Pillar with a Scala insurance to maximize both savings and protection.

What happens if I can no longer pay my premiums?

Depending on the product you choose, you usually have several options: reducing the premium amount, temporarily suspending payments, or converting the contract into a paid-up policy. The exact conditions depend on the product and the general terms and conditions.

Can I transfer my 3rd pillar from another insurer to Generali?

Yes, transferring a 3a pillar to another institution is possible, although some insurers apply transfer fees or surrender penalties. For 3b insurance, the transfer is more complex, as it often involves redeeming the existing contract (with potential losses) and then subscribing to a new one. It is important to calculate the costs carefully before making such a transfer.

What returns can we expect?

Historical fund performances (such as the 8% p.a. of the Multi Index 100) are indicative but not a guarantee of future performance. Financial markets fluctuate and results can vary considerably from one year to the next. These figures are used only to understand the fund's risk profile and track record.

What's the difference between Scala and Flex?

Both products offer a guaranteed death benefit and are available in 3a/3b, but Flex stands out for its management flexibility. With Flex, you actively allocate your premiums between a security account (guaranteed) and a return account (funds), with the option of adjusting this allocation during the term of the contract (from 10% to 95% in funds). Scala takes a more traditional approach, with a defined investment plan. Flex is more suited to people who wish to maintain active control over their investment strategy.

Best 3rd pillar 2025: Full comparison of rates and 3a funds

Claire Fivaz — Mon, 08 Dec 2025 06:05:17 +0000

In brief

3rd pillar solutions can be taken out in banking or insurance.
In December 2025, the best 3rd pillar A rate is proposed by CEA at 1.25 %, followed byAllianz (1.00 %).
3rd pillar products are available in the form of interest-bearing account, life insurance and funds.
The 3rd pillar in insurance includes additional warranties (savings guarantee, death, disability).
There is no no minimum rate for 3rd pillar A accounts, each bank is free to apply the rate of its choice.

What's the best 3rd pillar?

There's no better 3rd pillar in Switzerland. As with any investment strategy, the idea of a one-size-fits-all solution is a myth. Pension needs vary considerably according to investor profile, family situation, personal objectives and investment horizon.

Here are a few concrete examples:
It would be a major mistake to recommend a 100% fund solution to someone who is retiring in 5 years' time. Similarly, advising a self-employed person or the sole breadwinner of a family not to include death or disability cover in their policy could have serious consequences. Conversely, it often makes no sense to offer a 3a life insurance policy to a young single person with no family responsibilities.

What really matters? Systematically analyze fees and benefits in detail, whether in banking or insurance. The aim of a 3rd pillar is to grow your capital, not to see it eroded by excessive fees.

Comparison of 3rd pillar A accounts

The 3rd pillar A bank account is a form of tied pension provision in which the assets are placed in a blocked savings account, subject to a interest rate defined by the bank. This type of account does not offer high returns, but it does guarantee capital security and stability. It is often used to hold assets for the short to medium term, in particular with a view to early withdrawal (purchase of a home, transition to independence, etc.).

Conditions vary from bank to bank, particularly in terms of interest rates, online services and administrative flexibility. The table below compares the offers available in 2025.

Update: December 08, 2025

Comparative 3rd Pillar A

3rd Pillar A Capital Calculator

Year of birth

Annual payment (CHF)

Retirement at 65

Service provider	Rates 10.2025	Final capital

What is the best 3a account?

In October 2025, the highest interest rate on 3a accounts is offered by the Caisse d'Epargne d'Aubonne (CEA) to 1.25%, followed by Allianz at 1%.

In addition to the interest rate, it's essential to consider other factors, such as the administrative flexibilityand above all early withdrawal feeswhich can be as high as 500 CHF depending on the bank. These fees are often overlooked, but can reduce the effective return on short-term withdrawals.

Contribution limits

In 2025, it will be possible to pay out the following amounts in tied personal pension plans:

Compare with a clear conscience

Many online comparisons and articles on the 3rd pillar are written by authors who are not subject to the French law. FINMA supervision. Some earn their income from affiliate programs or commercial commissions, which may influence the presentation of results or the prominence given to certain providers.

Before relying on a recommendation, it is therefore essential to check the source, the author's regulatory status and the selection method used. In a field as sensitive as pensions, independence and rigorous analysis are more important than slogans or promises of returns. You can check the affiliation of the entity or person to a regulatory body on the Register of insurance intermediaries or the Register of financial intermediaries OAR.

Comparison of 3a Pension Funds

Conservative profile

A conservative profile will invest its 3a assets in 25% of shares maximum.

Funds/Portfolio	TER %	Equity %	Type	⌀Perf. 3 years	⌀Perf. 5 years	⌀Perf. 10 years
Descartes Index 20	0.40 %	20 %	Passive	5.7 %	3.0 %	2.7 %
Tellco Classic - Strategy 25	0.65 %	20 %	Passive	2.36 %	1.35 %	2.33 %
Zurich Invest II - Target Investment Fund 25 C	1.3 %	25 %	Active	4.9 %	1.2 %	-
Migros Bank (CH) Fonds 25 V	0.93 %	25 %	Active	5.2 %	1.7 %	-
Swiss Life Investment Foundation BVG-Mix 25	0.59 %	25 %	Active	4.4 %	2.0 %	2.63 %
UBS AST BVG-25 Aktiv Plus I-A1	0.65 %	25 %	Active	4.11 %	1.69 %	-
Swisscanto BVG 3 Responsible Portfolio 15 RT	0.57 %	15 %	Active	4.3 %	0.8 %	3.0 %
BEKB Strategiefonds Nachhaltig 20	1.18 %	20 %	Active	5.4 %	0.8 %	-
PF Pension - ESG 25 Fund	1.13 %	25 %	Active	5.6 %	1.62 %	-
Pax (CH) Sustainable Portfolio 25 ALV T	1.08 %	25 %	Active	5.9 %	2.1 %	1.69 %

Past performance is no guarantee of future performance. Investing involves a risk of capital loss.

Balanced profile

A balanced profile will invest its 3a assets between 30% and 50% shares maximum.

Funds/Portfolio	TER %	Equity %	Type	⌀Perf. 3 years	⌀Perf. 5 years	⌀Perf. 10 years
Swisscanto (CH) IPF III Vorsorge Fonds 45 Passiv	0.04 %	45 %	Passive	4.4 %	5.6 %	-
BCGE Synchrony LPP 40 A	0.86 %	40 %	Active	5.8 %	2.1 %	-
BCVs / WKB (CH) flex Pension 35 AP	1.39 %	45 %	Active	5.3 %	2.0 %	-
Swiss Life Investment Foundation BVG-Mix 45	0.59 %	45 %	Active	6.07 %	3.44 %	3.96 %
UBS AST BVG-40 Indexiert I-A1	0.28 %	40 %	Passive	6.69 %	2.74 %	3.1 %
Baloise LPP-Mix 40 Plus	0.81 %	40 %	Active	0.23 %	3.07 %	3.61 %
UBS (CH) Privilege 45 P-acc	1.40 %	45 %	Active	5.4 %	2.4 %	-
PF Pension - ESG 50 Fund	1.20 %	50 %	Active	7.7 %	3.5 %	-
PAX (CH) Sustainable Portfolio 50 ALV T	1.11 %	50 %	Active	6.77 %	3.56 %	4.33 %

Past performance is no guarantee of future performance. Investing involves a risk of capital loss.

Aggressive profile

A balanced profile will invest its 3a assets between 75% and 100% of shares.

Funds/Portfolio	TER %	Equity %	Type	⌀Perf. 3 years	⌀Perf. 5 years	⌀Perf. 10 years
Swisscanto (CH) IPF III Vorsorge Fonds 95 Passiv NT CHF	0.02 %	95 %	Passive	9.76 %	12.08 %	-
AXA (CH) Strategy Fund - Global Equity	0.16 %	95 %	Passive	17.14 %	10.82 %	-
Generali Multi Index 100	0.26 %	100 %	Passive	12.3 %	10.2 %	-
HSBC Asia Pacific ex Japan Sust. Equity UCITS ETF	0.25 %	100 %	Passive	22.82 %	9.2 %	-
Invesco MSCI USA UCITS ETF Acc	0.05 %	100 %	Passive	8.47 %	12.78 %	-
Swiss Life Investment Foundation BVG-Mix 75	0.61 %	75 %	Active	8.47 %	5.79 %	-
UBS (CH) Vitainvest - World 100 Sustainable U	1.62 %	100 %	Active	11.6 %	7.2 %	-
PF Pension - ESG 100 Fund	1.27 %	100 %	Active	12.0 %	8.5 %	-
Pax (CH) Sustainable Portfolio 100 ALV T	1.30 %	100 %	Active	9.87 %	6.09 %	6.58 %
Baloise Actions Global 0-100	0.59 %	100 %	Active	1.9 %	8.7 %	-
AXA (CH) Strategy Fund Economic Trends Equity CHF - S	0.34 %	100 %	Active	10.46 %	7.04 %	-
Zugerberg Finanz Revo4	1.25 %	80 %	Active	7.9 %	3.6 %	7.5 %
iShares S&P 500 CHF Hedged UCITS ETF (Acc)	0.2 %	100 %	Passive	4.4 %	14.4 %	11.8 %

Past performance is no guarantee of future performance. Investing involves a risk of capital loss.

3rd pillar comparator

Fill in our quote request form to compare 3rd pillar for customized, no-obligation analysis.

What should I bear in mind when choosing a 3a fund?

Investment horizon

Pillar 3a is an investment long term. The more time you have before retirement, the more risk you can afford to take, especially by investing in funds with a high equity component.

The general rule is: the further away you are from retirement, the more you should increase the equity interest. Close to retirement (5-10 years before), the strategy must be readapted and the equity portion reduced to minimize risk. On the other hand, if you are planning a withdrawal within the next 5 years, it is advisable to deposit this money in a 3a retirement savings account.

Management type

The passive funds reply a index (such as the SMI) and are generally inexpensive. They are well suited to a long-term, low-cost strategy.

The active fundsFor their part, they try to outperform the market through active stock selection. Some have succeeded in outperforming 3 to 5 years, but with higher fees. Performance will therefore depend on the "talent" of the fund manager.

Fees

Fees directly reduce the performance of your savings. The best passive funds have TERs of around 0.4%while some active funds exceed 1%.

But TER is not the only indicator of fees. Some funds have very low TERs, but this does not always reflect the real cost to the investor. This is because the TER only includes the fund's internal costs, such as portfolio management and administration. However, someother expenses may be added outside the TER, such as platform fees, external management fees, issuing commissions or fees related to insurance products.

So, even if the TER seems low (e.g. 0.10%), total fees can exceed 1% per year once all costs are taken into account. So it's essential to look at all costs to assess the true cost of an investment.

What types of 3rd pillar plans are available?

3rd pillar A

The 3rd pillar A is divided into two types: Pillar 3a bank and Pillar 3a in insurance. In banking, you can opt for a 3a savings account fixed-rate mortgages, which are safe but not very profitable, or for 3a pension fundinvested in the stock market with higher return potential but no capital guarantee.

On the insurance side, Pillar 3a takes the form of alife insurance mixed, which combine savings with coverage in the event of death or disability.’earning incapacity. There are also formulas linked to fundsto capture market returns, and flexible models customizable with various protection modules. Each3rd pillar insurance has its advantages depending on the policyholder's profile, investment horizon and objectives.

3rd pillar B

The 3rd pillar B is part of the individual pension plan freeunlike the 3rd pillar A, which is related subject to strict tax and withdrawal conditions. Pillar 3b covers all savings and insurance products that are not governed by the specific legislation of Pillar 3A: unrestricted life insurance, savings accounts, securities deposits and so on. It is not limited in amount, is not restricted to persons domiciled in Switzerland, and can be terminated at any time.

Unlike Pillar 3A, the tax benefits of the 3rd Pillar B are very limited and depend on the canton.

Is it true that it's better to avoid the 3rd pillar in insurance?

This idea is often repeated on the Internet, but it does not reflect the reality of today's market. Some insurance companies still charge high fees or offer rigid contracts, but others have modernized their offer considerably. Today, the best of them boast a TER between 0.20 % and 0.45 %supplemented by management fees for a total annual cost of between 0.8 % and 1.2 % maximum. These levels are comparable to, or even lower than, those of 3a banking solutions.

However, 3a insurance is not for everyone. It is primarily intended for people with family responsibilitiesYoung people, with no family responsibilities or variable income, often prefer the flexibility of a banking solution. Young people with no family responsibilities or variable income often prefer the flexibility of a banking solution.

The important thing is not to pit bank and insurance against each other, but to choose the solution that really suits your needs. personal situationand priorities.

To find out more, read our full analysis: 3rd pillar A: insurance or bank?

Frequently asked questions

What criteria should you compare when choosing a 3rd pillar?

Key elements to compare are: fees (TER), investment strategy (passive or active), equity component, payment flexibility, early withdrawal options, and insurance coverage and capital guarantee (if applicable).

Your choice should reflect your investment horizon, your risk tolerance and your possible need for insurance (death/disability risks).

What is the difference between a bank 3rd pillar and an insurance 3rd pillar?

The 3rd banking pillar focuses on thepure savings and investment, with great flexibility. The 3rd pillar in insurance combines savings and coverage of risk and guaranteed capital.

The choice between 3a in banking or insurance will depend on your profile and objectives.

What's the best 3rd pillar in 2025?

It all depends on your objectives. For 3a accounts, the best rate is offered by Caisse d'Epargne d'Aubonne to 1.25%.

The best 3a in funds will be the one to propose:

a strategy tailored to your goals and situation
quality funds (diversified, transparent, high-performance),
low annual fees (management + TER),
reduced operating costs (transfer, EPL withdrawal, change of strategy, etc.),
and the possibility of professional follow-up to adapt the strategy to your profile.

Is it risky to choose a 3a fund with a high equity component?

The short-term risk is higher, but over a longer long horizon (15 to 30 years), equity funds have historically generated superior returns. Younger investors are therefore often advised to opt for a more dynamic allocation, provided they can accept temporary fluctuations.

With a high proportion of shares, in the event of a stock market crash, you run a high risk of loss. capital loss.

Can I have several 3a accounts at different establishments?

Yes, we even recommend it. It helps tostagger withdrawals at retirement (to limit tax progressivity), diversify managers and adapt strategies to your objectives. The law allows several accounts, up to a maximum of annual ceiling contribution.

What are the best 3rd pillar investment vehicles?

The funds in shares (including index-linked or ETFs) are ideal for a long-term horizon, as they offer the best potential returns. For cautious profiles or those close to retirement, mixed or bond funds are more suitable. The choice depends on the risk you're prepared to take and the length of time until retirement.

Methodology

This comparison is based exclusively on public and verifiablemanagement fees, interest rates, historical yields and contractual terms and conditions published by the establishments concerned and on the website. Swiss Fund Data. Information is updated regularly to reflect the latest available data.

Some banks and insurance companies may pay a distribution fee when subscribing via Invexa. These commissions in no way influence the selection or presentation of products: only contracts offering transparent conditions and solid performance are included in this comparison. Solutions with excessive fees or inadequate performance are not included in the comparison.

Performance is expressed in annualized return (p.a.) to enable a fair comparison between products of different durations. Annualization indicates average performance per year, integrating the effect of compounding, which makes it more representative than gross cumulative returns over several years.

3rd pillar A: Insurance or Bank?

Claire Fivaz — Wed, 03 Dec 2025 13:37:33 +0000

On one hand, banking solutions offer flexibility in deposits and an investment-focused management. On the other, insurance products provide additional protection, particularly in cases of death or disability.

What is the 3rd pillar?

The 3rd pillar is an integral part of the swiss pension system, In addition to AHV (1st pillar) and occupational pension plans (2nd pillar). These are voluntary savings designed to improve living standards in retirement, while offering attractive tax benefits. There are two types: Pillar 3a, known as «linked», and Pillar 3b, known as «free».

Pillar 3a is reserved for people with a income subject to OASI . It allows you to build up long-term savings, with objectives such as supplementing your retirement, optimizing your tax situation, and protecting your loved ones in the event of an unexpected event.

Characteristics of the 3rd Pillar 3a in banking

Opting for a banking solution for your 3rd pillar A in Switzerland is a popular choice for many savers seeking greater flexibility and investment opportunities.

Flexible payments

Deposits are free, This means you can adjust your contributions to suit your budget and your needs. You can stop or resume payments at any time.

Limits and drawbacks

Unlike insurance solutions, a 3rd pillar bank account does not provide coverage in case of death or disability, and returns heavily depend on financial markets for investment options, which can result in losses during crisis periods.

100% savings contributions

The entire amount paid in is allocated to savings, without any risk coverage. This makes it a particularly suitable solution for young professionals with no family responsibilities, who prefer freedom and low management fees.

Advantages of 3a banking

Pillar 3a insurance features

Choose a insurance solution for your 3rd pillar in Switzerland is a popular option for those wishing to combine savings and protection. This type of provident scheme offers additional guarantees in the event of death or disability, while building up capital for retirement.

Savings and protection combined

In the event of death, the capital sum is paid directly to the designated beneficiaries. In the event of disability, the insurance generally covers the premiums, enabling savings to be maintained until the scheduled maturity date.

Long-term commitment

Premiums must be paid regularly, according to the amount set out in the contract. This helps discipline savings, but can be a constraint for those with fluctuating incomes.

Guaranteed returns

Insurance solutions often offer a guaranteed minimum return, which reduces the risk of capital loss. Some formulas include surplus dividends, allowing you to benefit from an additional return.

Profit sharing

Within a 3rd pillar insurance plan, the insured can benefit from a profit participation. This means that if the insurer achieves better financial results than expected, a portion of these profits is redistributed to clients as additional returns. While this participation is sometimes not guaranteed, it enhances the overall long-term performance.

Waiver of premiums in the event of disability

Another advantage of an insured 3rd pillar is the waiver of premiums in the event of disability. In practical terms, if the insured becomes unable to work for medical reasons, the insurance takes over and continues to pay into the policy on his or her behalf. Savings therefore continue as normal, without the insured having to pay new premiums, guaranteeing that the capital will be built up even in the event of a serious setback.

Higher costs

Unlike banks, where fees are deducted on a straight-line basis each year, insurers often apply an advance-fee model: a significant proportion of costs are paid in the first few years. This is why lower surrender value at the outset, before gradually catching up with the capital paid in as costs are amortized.

That said, fees should not be excessive: in particular, look at the « yield reduction »(aggregated conclusion, management and fund fees). By choosing a competitive insurer, you can maintain reasonable costs, relevant coverage and solid long-term performance.

Advantages of 3a insurance

Extra blanket: the insurance pays benefits in the event of death or disability
Profit sharing: part of the insurer's profits are redistributed to the policyholder
2-in-1 model: 3a endowment life insurance offers combined death/disability and savings protection
Guaranteed return: a minimum amount of capital can be guaranteed, regardless of the health of the financial markets.
Waiver of premiums in the event of disability: in the event of a GI, the insurer saves on your behalf.

What types of 3rd Pillar A are offered by banks?

In Switzerland, when considering opening a 3rd pillar A account with a bank, there are two main options: the classic 3a savings account and investment in 3a pension funds.

3a savings account

The 3a savings account is the simplest and most traditional form of Pillar 3a banking. Here, savings are deposited in a blocked account, earning a fixed interest rate set by the bank. This rate, while currently modest (below 1.1 %), has the advantage of offering a high level of capital security.

This solution is suitable if you plan to withdraw your 3a (for example, for a real estate purchase) within the next 5 years. However, it is important to be aware that, in the long term, the returns offered by this type of account are generally lower than inflation. Therefore, for young professionals or those with several decades ahead, this option may prove underperforming in terms of capital accumulation.

Pillar 3a banking in funds

Alongside the traditional savings account, many banks now offer 3a pension funds. This is no longer just about saving but investing your 3a assets in financial markets through diversified funds (ETFs, stocks, bonds, real estate, etc.).

Several strategies are possible depending on the investor profile (conservative, balanced, aggressive), which influences the equity allocation. However, unlike a savings account, the capital is not guaranteed in a 3a fund: the value of the savings can fluctuate, especially based on financial market performance. Nevertheless, over the long term, studies show that equity investments have historically offered better returns than fixed-income products.

What types of 3rd Pillar A are offered by insurance companies?

Insurance companies offer a more flexible 3a in terms of savings and risk coverage. They do, however, charge higher fees.

Classic combined life insurance

The traditional form of the 3rd pillar A in insurance is the classic mixed life insurance. In this model, the premiums paid by the insured are used both to build interest-bearing savings at a guaranteed interest rate and to finance coverage in case of death or loss of earning capacity.

In practice, this means that at the end of the contract (for example, at age 64 or 65), the insured receives a capital amount made up of their contributions, guaranteed interest, and possibly a profit participation if the company achieves better results than expected. In case of premature death or disability, a guaranteed capital is paid to the beneficiaries or the insured.

This type of contract is ideal for savers who value capital security and want to combine retirement savings with family protection without exposure to financial market risks. However, returns are lowand performance is often lower than that of a 3a bank account because of the additional risk-related costs.

Endowment life insurance

For those seeking higher return potential, insurance products also offer mixed life insurance with funds. In this case, the savings portion is not placed in a guaranteed interest account but invested in financial markets through proprietary funds, bank funds, or ETFs.

A risk coverage (death and often loss of earning capacity) is maintained throughout the contract duration, and the savings evolve according to the fund performances. If the markets perform well, the savings can grow faster than in a traditional savings account. However, the contract’s cash surrender value may decline in case of poor stock market results.

flexible 3a

Finally, an increasing number of insurers now offer so-called flexible 3a solutions. These contracts emphasize high customization: the savings are invested in investment funds, but the insured can choose to add protection modules.

Possible options include :

A death cover (fixed capital or proportional to savings)
A disability insurance (with premium waiver or annuity payment)
A disability insurance (payment of a lump sum or an additional annuity).
Waiver of premiums in the event of disability (the insurance covers you in the event of disability)

The main advantage of these flexible solutions is that they enable you to tailor your pension plan precisely to your needs, whether in terms of savings, risks covered or degree of exposure to the markets. They also offer the possibility of modifying certain parameters (including premiums) during the term of the contract.

Comparison of banking VS insurance fees

When choosing between a Pillar 3a with a bank and a Pillar 3a with an insurance company, the question of costs is often at the forefront. At first glance, bank solutions seem more economical. However, a detailed analysis shows that the reality is more nuanced.

In banking, fees are mainly concentrated on the investment. They take the form of fund management fees (called TERfor Total Expense Ratio), which generally vary between 0.25 % (e.g: UBS Vitainvest funds) and 1.60 % per annum. The more passive the solution (index ETFs, for example), the lower the TER. There is no death or disability protection: the bank offers only an investment vehicle. Digital pension providers also charge total annual fees of around 0.5% on average.

In insurance, the situation is different. The passive funds chosen often have lower TERs - around 0.15 % (eg: AXA SmartFlex Funds) to 0.45 % - because insurers prefer institutional funds with reduced fees. In addition to these fund fees, however, there is the so-called contract performance reduction: this includes the insurance management fees as well as administrative costs. This reduction varies from one provider to another, typically between 0.5 % and 2.10 % per year.

This mechanism makes sense: in insurance, the 3a contract is not limited to a single product. investment. It also guarantees a death benefit, protects savings in the event of an unexpected event, and often offers options such as phased withdrawal before retirement. These services come at a cost, but they meet a need for security that the banking solution does not. However, it's crucial to check the level of fees carefully before signing up, as some insurers charge high fees that can significantly reduce net returns over the long term.

Should I take out a 3a bank or insurance policy?

There is no universal answer to this question. The bank maximizes long-term performance by minimizing fees but offers no immediate protection in case of unforeseen events. In contrast, the insurance guarantees a death benefit from day one and protects the savings against life’s uncertainties, albeit with a slight reduction in net returns.

The best choice depends on the saver’s profile: their age, family responsibilities, saving capacity, risk tolerance, and personal priorities. A young single person without financial commitments might favor a pure banking strategy. Someone looking to secure a life project, protect their family, or cover disability risks will find a more comprehensive and suitable solution in insurance.

The key is to choose knowingly, understanding what each option offers, while having a transparent view of the fees involved.

3A comparison chart in banking VS insurance

Determined in advance

Flexible

Profit sharing

No profit sharing

Amount guaranteed to 100%

Guaranteed amount up to CHF 100,000

Possible

Medium to long-term

Long-term

Possible

Frequently asked questions

Is 3a insurance necessarily less profitable than banking solutions?

No, not necessarily.

3a insurance modern often use index funds or ETFs with very low fees (TER from 0.15% to 0.45%), comparable to those of the best banking solutions.

Net performance depends above all on the contract chosen, the investment profile and overall costs (including yield reduction).

Why take out 3a insurance if it costs a little more?

Because it offers a little more than just performance :

A death benefit guaranteed from the first payment,
Waiver of premiums in the event of disability,
Secure management at the end of the contract to protect accumulated capital.

For many people, this global security more than justifies a slight reduction in yield.

Can I combine a 3a bank account with a 3a insurance account?

Yes, that's right.
It is possible - and in some cases advisable - to have several 3a contracts:

A banking contract in funds to maximize long-term returns,
A insurance contract to secure part of your capital and protect your loved ones.

This approach allows you to benefit from the advantages of each solution.

What happens if I die at the start of a 3a insurance contract?

The insurance immediately pays out the guaranteed death benefit specified in the contract, often ranging from CHF 100,000 to 250,000.

For example, even after only CHF 7,200 paid in, your heirs can receive CHF 200,000 (depending on the contract). With a bank solution, only the actual accumulated savings are paid out (e.g., CHF 7,200 plus any potential gains).

Is it true that 3a banking is more flexible than insurance?

Yes, a 3a bank is generally more flexible:

You can pay in what you want, when you want (within the legal limit).
You can stop payments without penalty.

With 3a insurance, you commit yourself to paying a regular premium over a fixed period. However, today's modern insurances offer greater flexibility (premium adjustment, release of the insurance in case of need).

Can I change my mind and stop a 3a insurance policy early?

Yes, but with caution. Cancelling a 3a policy in the first few years can lead to serious losses (cash surrender value less than premiums paid). That's why it's essential to choose a contract that meets your long-term needs before committing yourself.

The 3a bank account is more suitable for long-term savings, as you can choose not to pay into it for as long as you wish (no payment obligation).

How much can I pay into my 3a VS bank for insurance?

Whether in banking or insurance, the maximum amounts are as follows:

CHF 7,258 per year if you are an employee with a pension fund
Up to CHF 36,288 per year (or 20% of net income) if you are self-employed (or employed) without a pension fund.

Scale 44: Monthly AHV Pensions for 2025

Claire Fivaz — Wed, 03 Dec 2025 07:44:07 +0000

Pension

Scale 44: Monthly AHV Pensions for 2025

December 3, 2025

This table presents the amounts of complete monthly old-age and survivors' insurance (AHV/OASI) and disability insurance (DI) pensions according to scale 44, valid from January 1, 2025. The amounts are calculated based on the determining average annual income and include old-age and disability pensions, widow and widower pensions, supplementary pensions, as well as pensions for children and orphans. Click on the column headers to sort the data in ascending or descending order.

AHV/IV Renten 2025

Annual income (CHF) Jahreseinkommen	Old-age/disability pension Alters-/Invalidenrente	Widows/Widowers Witwen/Witwer	Supplementary pension Zusatzrente	Child's pension Kinderrente	Orphan's pension Waisenrente	Orphan's pension 60% Waisenrente 60%
bis 15'120	1'260	1'512	1'008	378	504	756
16'632	1'293	1'551	1'034	388	517	776
18'144	1'326	1'591	1'060	398	530	795
19'656	1'358	1'630	1'087	407	543	815
21'168	1'391	1'669	1'113	417	556	835
22'680	1'424	1'709	1'139	427	570	854
24'192	1'457	1'748	1'165	437	583	874
25'704	1'489	1'787	1'191	447	596	894
27'216	1'522	1'826	1'218	457	609	913
28'728	1'555	1'866	1'244	466	622	933
30'240	1'588	1'905	1'270	476	635	953
31'752	1'620	1'944	1'296	486	648	972
33'264	1'653	1'984	1'322	496	661	992
34'776	1'686	2'023	1'349	506	674	1'011
36'288	1'719	2'062	1'375	516	687	1'031
37'800	1'751	2'102	1'401	525	701	1'051
39'312	1'784	2'141	1'427	535	714	1'070
40'824	1'817	2'180	1'454	545	727	1'090
42'336	1'850	2'220	1'480	555	740	1'110
43'848	1'882	2'259	1'506	565	753	1'129
45'360	1'915	2'298	1'532	575	766	1'149
46'872	1'935	2'322	1'548	581	774	1'161
48'384	1'956	2'347	1'564	587	782	1'173
49'896	1'976	2'371	1'580	593	790	1'185
51'408	1'996	2'395	1'597	599	798	1'197
52'920	2'016	2'419	1'613	605	806	1'210
54'432	2'036	2'443	1'629	611	814	1'222
55'944	2'056	2'468	1'645	617	823	1'234
57'456	2'076	2'492	1'661	623	831	1'246
58'968	2'097	2'516	1'677	629	839	1'258
60'480	2'117	2'520	1'693	635	847	1'270
61'992	2'137	2'520	1'710	641	855	1'282
63'504	2'157	2'520	1'726	647	863	1'294
65'016	2'177	2'520	1'742	653	871	1'306
66'528	2'197	2'520	1'758	659	879	1'318
68'040	2'218	2'520	1'774	665	887	1'331
69'552	2'238	2'520	1'790	671	895	1'343
71'064	2'258	2'520	1'806	677	903	1'355
72'576	2'278	2'520	1'822	683	911	1'367
74'088	2'298	2'520	1'839	689	919	1'379
75'600	2'318	2'520	1'855	696	927	1'391
77'112	2'339	2'520	1'871	702	935	1'403
78'624	2'359	2'520	1'887	708	943	1'415
80'136	2'379	2'520	1'903	714	952	1'427
81'648	2'399	2'520	1'919	720	960	1'439
83'160	2'419	2'520	1'935	726	968	1'452
84'672	2'439	2'520	1'951	732	976	1'464
86'184	2'460	2'520	1'968	738	984	1'476
87'696	2'480	2'520	1'984	744	992	1'488
89'208	2'500	2'520	2'000	750	1'000	1'500
90'720+	2'520	2'520	2'016	756	1'008	1'512

Download scale 44 in pdf

Download scale 44 as image

What is scale 44?

Scale 44 is the official scale used by the’AHV (Old-Age and Survivors' Insurance) to determine AVS pension amounts and AI in Switzerland. This scale establishes a precise correspondence between average annual income and the monthly amount of his pension. Effective January 1, 2025, this scale 44 applies to all old-age and disability pensions, as well as widows', widowers', orphans' and children's pensions.

The ladder 44 system ensures fair redistribution: people who have contributed on higher incomes receive proportionately larger pensions, within the ceiling limit set by law.

What is the maximum AHV pension in 2025?

According to scale 44, the maximum AHV pension in 2025 is CHF 2,520 per month, or CHF 30,240 per year. This amount is awarded to people who have contributed without interruption throughout their working lives and whose average annual qualifying income is at least CHF 90,720.

The minimum annuity, is set at CHF 1’260 per month for people with a full contribution period but an average income of less than CHF 15,120.

What is the maximum pension for a married couple in 2025?

For married couples, scale 44 provides for a ceiling: the total amount of the two pensions cannot exceed 150 % of the maximum individual pension. In 2025, this corresponds to CHF 3,780 per month (or CHF 45,360 per year) for the couple.

This cap applies even if each spouse would individually be entitled to the maximum pension of CHF 2,520. If the sum of the two pensions exceeds CHF 3,780, it is automatically reduced to comply with this limit.

How is the average annual AHV income calculated?

The determining average annual income is the central element of the calculating an AHV pension according to scale 44. Here's how it works:

1. Summation of income: All earnings subject to AHV contributions during working life are added together, from the age of 20 until retirement age (64 for women, 65 for men).

2. Revaluation: These incomes are updated in line with wage trends in Switzerland, to take account of inflation and economic growth.

3. Bonuses: Additional amounts are added for years spent raising children under the age of 16 (bonuses for educational tasks) or caring for dependent relatives (bonuses for assistance tasks).

4. Average calculation: The total is divided by the number of years of contributions to obtain the average annual income.

This average income is then used to determine the pension amount according to scale 44. The higher the average income, the higher the monthly pension, up to a maximum of CHF 2,520.

What is the amount of a comfortable retirement in Switzerland?

Although scale 44 defines AVS amounts, a comfortable retirement in Switzerland requires income above the maximum AVS pension. We estimate that a retirement income of around 70 to 80 % of last salary is necessary to maintain its standard of living.

For a single person, this could represent between CHF 4,000 and CHF 6,000 per month, combining the AVS (1st pillar), the pension fund (2nd pillar) and the pension.’private savings (3rd pillar). For a couple, a combined monthly income of CHF 6,000 to CHF 8,000 is often considered comfortable. However, it should be noted that the higher the income, the greater the gaps will be, as the compulsory AHV and IV benefits will not be covered. LOB are capped. As a result, a effective retirement planning is required to supplement income.

Is it possible to receive the AHV/OASI pension before age 65?

Yes, it is possible to’anticipate the payment of AHV pensions, but it also means definitive reduction of scale 44. Insurees can apply for their pension up to two years before the normal retirement age, i.e. from 63.

The reduction is 6.8 % per year of anticipation. For example, a person anticipating his pension by two years will see his amount reduced by 13.6 % for life. This reduction applies to the amounts defined by scale 44.

Conversely, it is also possible to defer payment of the pension for up to five years after ordinary retirement age, thereby increasing the amount of the pension.

What's the difference between a full pension and a maximum pension?

The distinction between full and maximum pensions is essential to understanding scale 44.

A full pension means an annuity calculated on the basis of a full contribution period, In other words, there will be no gap between the age of 20 and the normal retirement age (64 for women, 65 for men in 2025). A person receiving a full pension has contributed for 44 or 45 consecutive years. However, the amount of a full pension can vary considerably depending on the average annual qualifying income: it can be as low as CHF 1,260/month (minimum full pension) or as high as CHF 2,520/month (maximum full pension).

A maximum pension, corresponds to the highest amount that a person can receive under scale 44, i.e. CHF 2,520 per month in 2025. To obtain this maximum pension, two conditions must be met: a full contribution period AND an average annual income of at least CHF 90,720.

In a nutshell: all maximum pensions are full pensions, but not all full pensions are maximum pensions. A person may have paid contributions for 44 years without interruption (full pension) but receive only CHF 1,500/month if his income was modest, while another who has paid contributions for the same number of years on a higher income will receive the maximum pension of CHF 2,520/month.

Claire Fivaz

Claire Fivaz is an IAF-certified advisor in insurance, pension planning and wealth management (FINMA No.: F01518014), and also holds a Bachelor's degree in International Business Management from HEG Geneva. With many years' experience in individual and occupational pension planning in Switzerland, she assists her customers in planning their retirement and managing their financial assets.

Claire Fivaz

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Tax on Second Homes in Switzerland: Complete Guide and 2025 Reform

Claire Fivaz — Tue, 02 Dec 2025 14:03:45 +0000

In brief

Until 2028 (at the earliest), owners of second homes must declare rental value as taxable income.
The rental value will be abolished in 2028, but tax deductions will be drastically limited.
The cantons will be able to introduce a special property tax on second homes.
Swiss municipalities may not exceed 20% of second homes on their territory.
At the time of sale, a tax is applied to the profit earned.

What is a second home in Switzerland?

A second home is clearly distinct from the main residence. It is a property used occasionally, generally for vacations or leisure, and located in a different place (canton or country) from your primary residence.

Secondary residence vs. secondary home

It is essential to understand this important distinction. A second home is a property used occasionally for vacation and relaxation, with no connection to professional activity. In contrast, a secondary residence is linked to a professional activity and used by people residing there during the week.

This distinction has important legal implications, as second homes are subject to the Federal LRS Law (Law on Secondary Residences), unlike primary residences. The law defines a primary residence as any property occupied for a long period, whereas a second home includes any property that does not fall into this category.

Legal restrictions on second homes in Switzerland

Swiss municipalities must adhere to a strict quota of maximum 20% of second homes within their territory. This rule aims to preserve the balance between tourist accommodations and housing for permanent residents, while maintaining social cohesion in the affected areas. Cantons remain free to enforce stricter rules if they wish and may authorize properties intended for qualified tourist accommodation.

Specifics on Second Homes Located Abroad

If you own a vacation home abroad or a second residence in another country, the property in question and any income it generates will be taxed in that country. However, you must still declare this property in Switzerland as well, even if you do not pay any federal, cantonal, or municipal tax on it.

However, its value and the income it generates affect the tax rate: the fiscal value influences the level of the wealth tax, and the income (rental income and imputed rental value minus deductible maintenance costs and mortgage interest) affects the level of the income tax rate.

Second-home tax: current system

Rental value: fundamental principle

Until the reform is implemented, owners of second homes are subject to the rental value system. This tax mechanism treats the theoretical rent you could receive if you rented out your property as taxable income. It is a notional income that must be declared to the Confederation, cantons, and municipalities.

Each canton applies its own calculation rules, taking into account the property’s location, living area, year of construction, and local market rental prices. In practice, the rental value generally represents between 60% and 70% of the estimated market rent. This amount must be declared in your tax return, even if you use your residence only a few weeks per year, and even if weather conditions (snowfall, avalanche risks) limit the property’s use.

Associated tax deductions

The current system allows the taxation of the rental value to be offset by several deductions. You can notably deduct mortgage interest, maintenance costs of the property, renovation work, investments in energy efficiency, and measures to protect the environment. These deductions can be substantial and allow many highly indebted owners to pay less tax than the theoretical rental value would suggest.

Property tax on second homes

In addition to the rental value, owners pay an annual property tax, calculated on the gross value of the property. The rate varies between 0% and 0.3% depending on the canton. Some cantons have abolished this tax, while others enforce it strictly.

The way the fiscal value is determined also differs from canton to canton: some base it on the purchase price at the historical time of acquisition, others use the average price of the year of acquisition, and some even apply a deduction.

Declaration of assets

Your second home must be included in your tax return, where it will be recorded as an asset. No special tax benefits are granted, as a second home is considered a privilege. This declaration is in addition to the taxation of the rental value and can affect your overall tax rate.

The Reform of 28 September 2025

28 September 2025 marks a major turning point in Swiss tax history. Citizens approved the abolition of the rental value taxation by 57.7%, ending more than a century of fiscal tradition. This decision comes after four previous reform attempts, all of which failed in 1999, 2004, 2012, and during subsequent parliamentary initiatives.

The uniqueness of this fifth attempt lies in its balance: unlike previous proposals that abolished rental value taxation while retaining most tax deductions, this reform drastically limits deduction possibilities.

Pillars of the reform

The reform consists of two legally linked elements that cannot come into effect independently. On one hand, the abolition of rental value taxation ends the obligation to declare notional income for property owners, whether for primary or secondary residences. This abolition is expected to take effect no earlier than 2028.

On the other hand, a new cantonal property tax on second homes allows cantons to create a special property tax to offset the loss of tax revenue from second homes. This constitutional provision gives cantons significant freedom in implementation, thus respecting Swiss fiscal federalism. Cantons can also authorize municipalities to collect this tax, either separately or as a surcharge on an existing property tax.

Drastic reduction in tax deductions

In exchange for the abolition of rental value taxation, the reform significantly restricts deductions. The deduction for property maintenance costs is eliminated for federal, cantonal, and municipal taxes. Energy-saving measures and environmental protection investments are no longer deductible from direct federal tax.

Regarding interest expenses, the reform adopts the strictest version debated in Parliament. Owners can only deduct interest expenses if they rent out or lease their property. A notable exception applies to first-time buyers of a primary residence, who can deduct interest expenses for 10 years within a set limit, to facilitate property ownership for young adults and families.

Impact of the reform on owners of second homes

Each canton will need to decide whether to introduce this tax and under what conditions. Estimates suggest that a rate between 4.7‰ and 9.2‰ of the fiscal value would be necessary to offset revenue losses in tourist cantons. Practically, for a second home valued at CHF 1,000,000, this would represent an annual tax between CHF 4,700 and CHF 9,200, in addition to other taxes such as wealth tax and tourist tax.

This room for manoeuvre left to the cantons is in line with Swiss federalism in tax matters, and allows for tailor-made solutions adapted to local realities. Some cantons with little interest in second homes may even decide not to introduce the tax, while others that are heavily dependent on tourism-related tax revenues will probably have to do so.

Who are the winners and who are the losers?

The reform creates very different situations depending on the owners’ profiles. Owners who have repaid a large part of their mortgage, particularly retirees with low debt, will generally benefit from the reform, as they could no longer deduct much interest but still had to declare the rental value. For them, the abolition of rental value represents a significant relief.

Conversely, second-home owners in cantons that introduce the special tax could see their tax burden increase. This is especially true for those who regularly carried out deductible maintenance work and for highly indebted owners who fully benefited from interest deductions. Highly indebted young buyers will be disadvantaged, unless they are first-time buyers of a primary residence.

Alpine cantons particularly hard hit

The cantons of Valais, Graubünden, and Ticino host a significant share of Switzerland’s second homes. Estimates suggest that these tourist regions could lose around CHF 150 million in tax revenue due to the abolition of rental value taxation on second homes. To maintain their budgets, these cantons will very likely introduce the special property tax, increasing the tax burden on second-home owners in these popular areas.

The canton of Berne has a special feature: at present, only the highest rental value (that used for direct federal taxation) is applied for cantonal taxation of second homes. With the reform, this canton will also have to revise its tax system to compensate for the losses.

Tax on real estate capital gains

When selling a second home

Whether under the current system or the reform, the sale of a second home generates a real estate capital gains tax if you make a profit, meaning the sale price exceeds the purchase price of the property. This tax applies in the same way as for the sale of a primary residence and is collected by the canton where the property is located.

The crucial role of length of ownership

The length of time you have owned your second home directly affects the amount of real estate capital gains tax. The longer you hold the property, the lower the tax, thanks to a progressively decreasing scale applied in all cantons. Conversely, a quick resale not only results in a significantly higher tax but may also trigger a speculation surcharge.

This speculation surcharge aims to discourage the rapid buying and reselling of properties, thereby contributing to market stability. It can represent a very significant tax burden and turn an apparently profitable transaction into a financial loss. This is why it is essential to approach the purchase of a second home with a long-term perspective, ideally holding it for at least 10 to 15 years.

Renting your second home

Taxation of rental income

If you decide to rent out your second home during periods when you do not use it, this rental activity has significant tax implications. Rental income is subject to income tax just like your other income. Under the current system, you must pay tax on a portion of the rental value proportional to your personal use. The canton of Bern is an exception, applying only the highest rental value.

Some cantons also allow a tax deduction for wear and tear caused by renting out the second home. In any case, as with a rented primary residence, mortgage interest and certain renovation work remain deductible.

After the reform

Under the new legislation, the situation for owners who rent out their property will be noticeably different. Rental income will remain taxable as it is today, but owners will be able to deduct interest expenses, unlike owners of properties used exclusively for personal purposes. This difference in treatment could encourage more owners to rent out their second homes for tourism.

The special property tax on second homes is not expected to apply to properties regularly rented out, as it specifically targets residences used primarily for personal purposes. This distinction could create a significant tax advantage for renting and influence owner behavior.

Conclusion

The tax on second homes in Switzerland is undergoing a historic transformation with the reform adopted in September 2025. The abolition of rental value taxation significantly simplifies the Swiss tax system, ending a century-old mechanism often criticized for its complexity. However, this simplification comes with uncertainties regarding the future cantonal property tax, which could substantially alter the tax burden for second-home owners.

For current and future second-home owners, the 2025–2028 period will be critical. It will be essential to closely monitor cantonal decisions regarding the introduction and conditions of the special tax, anticipate the fiscal impact based on your personal situation considering your debt level and financial capacity, strategically plan renovation work before the reform takes effect to take advantage of the final deductions, and consult a tax expert or financial advisor to optimize your strategy in this new context.

Taxation of second homes remains a complex subject requiring a thorough understanding of federal and cantonal rules, as well as ongoing legislative developments. Differences between cantons will likely become more pronounced with the reform’s implementation, making comparison and strategic planning even more important.

Frequently asked questions

What's the difference between a secondary residence and a second home?

A second home is used for vacation and leisure, whereas a secondary residence is linked to professional activity. Only second homes are subject to the Federal LRS Law. This distinction is important because it determines the applicable tax regime and any potential purchase restrictions.

Will tax on second homes increase with the reform?

This will entirely depend on cantonal decisions. In cantons that introduce the special property tax, particularly highly touristic alpine cantons, the tax burden could increase despite the abolition of rental value taxation. In other, less affected cantons, owners could instead benefit from a net tax relief.

Can I still deduct my renovation costs?

Until the reform takes effect, expected no earlier than 2028, you can continue to deduct your renovation work under the current rules. This makes it the right time to plan and carry out any major projects you were considering. After the reform comes into force, deductions for maintenance work will be eliminated for federal, cantonal, and municipal taxes.

Which canton will be the most advantageous for a second home after the reform?

It is still too early to give a precise answer to this question. Each canton must first decide on the introduction and rate of the special property tax. Cantons with few second homes might not introduce this tax, which would potentially make them more attractive. Conversely, popular tourist cantons will probably have to compensate for lost tax revenue.

Do I have to sell my second home before the reform?

A hasty sale is generally not recommended. First analyze your personal situation, taking into account your level of indebtedness, your ability to pay any special taxes, and the length of time you have already held the property. A quick sale would generate a high property gains tax and potentially a speculation surcharge, which could cancel out the benefits sought. You should wait to see what your canton decides about the special tax before making a final decision.

Can I withdraw funds from my 2nd or 3rd Pillar A to buy a second home?

No. Funds from the 2nd pillar and 3rd pillar A are subject to strict withdrawal conditions. Therefore, it is only possible to acquire a primary residence using these funds.