pillar 3a maximum contributions limit
Investing & Retirement

How Much Can I Contribute to the Pillar 3a?

December 24, 2023 - Benjamin Manz

How much can you contribute to your third pillar retirement savings? How have contribution limits changed over the years?

In Switzerland, making payments into the voluntary third retirement savings pillar has two primary advantages.

Firstly, the interest rates on 3a savings accounts are higher than those of regular savings accounts.

Secondly, contributions are tax deductible.

Because 3a contributions are tax deductible, legal limits define the amount of money which you can contribute to 3a retirement savings every year.

Maximum contributions for employees and self-employed people

Two separate annual contribution limits are used in Switzerland, and you employment status determines which of these limits applies to you.

  • An employed person who makes contributions into the second retirement savings pillar (an employee-sponsored pension fund) can contribute 7056 francs per year into the third pillar on a tax-privileged basis (2024 limit). While this limit typically applies to employed people, for which second pillar contributions are obligatory, it can also apply to self-employed persons who contribute to second pillar retirement savings.
  • Employed people who do not contribute to a pillar 2 pension fund at the time of making pillar 3 contributions can contribute as much as 20% of their income to third pillar 3a retirement savings on a tax-deductible basis – up to a maximum annual contribution limit of 35,280 francs (2024 limit). This arrangement normally applies to self-employed people.

When individuals are part of legal relationships, if both spouses or both legal partners are employed and contribute to second pillar retirement funds, the tax-deductible contribution limits apply to each individual separately. 

When referring to pillar 3a contributions made by individuals who also contribute to a second pillar pension fund, the term “small pillar 3a” is sometimes used. Annual contributions, in this case, cannot exceed 7056 francs (2024). The maximum 3a contribution limit for individuals without an employee-sponsored pension fund is much higher (35,280 francs), which is why this arrangement is sometimes referred to as the “large pillar 3a”.

However, the terms “small” and “large” can be misleading because the maximum contribution for individuals without a pension fund (the “large pillar 3a”) can, in practice, be lower than the maximum contribution for individuals with a pension fund.

Example: A self-employed person without a pension fund has a net income of 30,000 francs. The maximum tax-deductible contribution that person can make to their 3a retirement savings is 6000 francs per year (20 percent of 30,000 francs). An employed person with a second-pillar pension fund, on the other hand, may contribute up to 7056 francs (as of 2024) to their 3a retirement savings on a tax-deductible basis.

Maximum annual contributions by year

Every year, the federal government defines the maximum tax-deductible contribution limit. On average, the limit has been changed every two years.

The following chart provides an overview of progressive changes to third-pillar contribution limits, both for people with and without second-pillar pension funds.

Year With pension fund Without pension fund
2024 CHF 7,056 CHF 35,280
2023 CHF 7,056 CHF 35,280
2022 CHF 6,883 CHF 34,416
2021 CHF 6,883 CHF 34,416
2020 CHF 6,826 CHF 34,128
2019 CHF 6,826 CHF 34,128
2018 CHF 6,768 CHF 33,840
2017 CHF 6,768 CHF 33,840
2016 CHF 6,768 CHF 33,840
2015 CHF 6,768 CHF 33,840
2014 CHF 6,739 CHF 33,696
2013 CHF 6,739 CHF 33,696
2012 CHF 6,682 CHF 33,408
2011 CHF 6,682 CHF 33,408
2010 CHF 6,566 CHF 32,832
2009 CHF 6,566 CHF 32,832
2008 CHF 6,365 CHF 31,824
2007 CHF 6,365 CHF 31,824
2006 CHF 6,192 CHF 30,960
2005 CHF 6,192 CHF 30,960
2004 CHF 6,077 CHF 30,384
2003 CHF 6,077 CHF 30,384
2002 CHF 5,933 CHF 29,664
2001 CHF 5,933 CHF 29,664

 

More on this topic:
Compare 3a retirement accounts now
How to optimize taxes with the third pillar
3a pension funds: key tips

Expert Benjamin Manz
Benjamin Manz is CEO of moneyland.ch and an independent expert on banking and finance.
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