The 3rd pillar in Switzerland is a voluntary retirement savings system designed to complement the benefits of the AVS (first pillar) and the pension funds (second pillar). It comes in two main forms. On the one hand, Pillar 3a, dedicated to retirement, offers tax advantages in exchange for certain withdrawal restrictions. On the other hand, Pillar 3b provides more flexible savings options, although it does not offer the same tax incentives.
Tax deductions in the 3rd pillar: what are we talking about?
The 3rd pillar is not just a retirement tool: it's also an effective way of reducing your tax burden. In Switzerland, payments into pillar 3a benefit from a direct income tax deduction, up to an annual ceiling set by the Confederation. Visit pillar 3boffers certain tax advantages, depending on the canton, but only for recognized forms of pension provision, in particular via a "pension fund". life insurance.
New: 3a redemptions
In 2026, it will be possible to make subsequent 3rd pillar A purchases for the 2025 tax year of CHF 7,258 (ceiling).
Pillar 3a tax deduction
Contributions paid into a 3rd pillar A account or policy are deductible from taxable income in the tax return, up to a maximum amount set each year.
This ceiling is the same throughout Switzerland, regardless of whether you deposit your credit at a bank or insurance company.
In practice, this makes it possible to reduce your taxable income and therefore pay less tax, while building up locked-in retirement capital until retirement or certain specific situations (buying a home, going abroad, becoming independent, etc.).
Contribution limits
In 2025, it will be possible to pay out the following amounts in tied personal pension plans:
- Employees affiliated to a pension fund: Up to CHF 7,258 / year
- Self-employed or employees not affiliated to a pension fund: 20% of income, maximum CHF 36,288
How to calculate the Pillar 3a tax deduction?
To calculate your tax deduction, you need to know your marginal tax rate. Let's take an example:
- Canton: GE
- Commune: Geneva (1205)
- Number of dependent children: 2
- 1. Net annual income: CHF 90,000
- 2. Payment 3a: -7,258 CHF
- 3. Other (flat-rate) tax deductions: -CHF 52,594
- 4. Taxable income: approx. CHF 70,500
- 5. Taxable income: Cantonal rate: 148.5 %
- 6. Communal rate (city of Geneva): 45.5 %
- 7. Total : 194 %
After applying these rates and the canton's progressive tax scale, we obtain:
- 8. Total taxes with 3a: 1692 CHF
- 9. Total taxes excl. 3a: CHF 3,049
- In other words, by contributing CHF 7,258 to your Pillar 3a, you reduce your taxes by around CHF 1,350 per year in Geneva.
- This represents almost 19 % savings on your payment.
Pillar 3b tax deduction
The 3rd pillar B offers no federal tax advantages. However, several cantons, including Geneva and Fribourg, allow deductions for 3b life insurance policies (long-term savings products with insurance coverage).
These deductions apply only to recognized life insurance premiums and not to other forms of Pillar 3b.
3b deductions in Geneva
1. Cantonal and municipal tax (ICC)
- Single / widowed / divorced / separated: CHF 2,232
- Married couple or registered partners: 3,348 CHF (2 × 1,674 CHF)
- For family responsibilities: 913 CHF
2. Direct federal tax (IFD)
- Single / widowed / divorced / separated: CHF 1,800
- Married couple or registered partners: CHF 3,600
- For family responsibilities: 700 CHF
In both cases, the amounts are increased by half if the taxpayer is not affiliated to a 2nd pillar or pillar 3a.
Frequently asked questions
Pillar 3a contributions are tax-deductible. This makes it possible to reduce your taxes cantonal, municipal and federal.
In practice, depending on your income and canton, you can save around 15 % and 35 % of the amount paid each year.
Pillar 3b is not deductible at federal level, but some cantons, such as Geneva and Fribourg, allow a partial deduction for recognized life insurance policies.
Your savings depend on your marginal tax rate (your highest tax bracket).
To estimate it :
- Calculate your net annual income.
- Subtract the amount you pay into your Pillar 3a.
- Apply your cantonal and municipal tax rates.
Yes, your service provider (bank or insurance company) will send you an annual tax certificate indicating the amount paid.
Payments are taken into account until December 31 of the fiscal year. A payment made in January will count for the following year.
Yes, it's even recommended. It facilitates phased withdrawal at retirement, to reduce taxation on the capital paid in.
