Should I Pay Into the Pillar 3a This Year?

In the past, not paying into the pillar 3a in a given year meant that the opportunity and the tax deduction were lost forever. But that is changing. From 2026, you will be able to make extra payments into the pillar 3a to make up for missed payments in previous years.  

That raises an interesting question: Should I pay into the pillar 3a this year? Or would it make more sense to wait and make the contribution in a different year? The effective tax savings are the deciding factor in determining the answer to those questions.

For many people, paying into the pillar 3a every year is still the most sensible option. But depending on your situation, you could get more tax benefits by putting it off until a different year and then closing the gap in arrears.

When does it make sense to pay into the pillar 3a?

If you are employed and already have a steady career and a stable income, then contributing to the pillar 3a every year normally makes sense. Ideally, you should contribute the maximum possible amount, if you can afford to.

On the other hand, if you have temporarily reduced your working hours or are able to claim other tax deductions for the current year, then it can make sense to put off pillar 3a contributions until a different tax year.

When is it better to postpone pillar 3a contributions?

If you are just starting out in a career, and expect your income to increase substantially in the future, then postponing pillar 3a contributions can be beneficial. The same thing applies to students and apprentices. 

There are several reasons why paying later in arrears can make sense. Firstly, the higher your income is in a given tax year, the more money you can save with the pillar 3a tax deduction. Secondly, because money you place in the pillar 3a is blocked, you should use available money to build up your emergency fund before you begin saving with the pillar 3a. Thirdly, if you have debts, you should use available money to repay your debts before contributing to the pillar 3a. 

If you will already claim large tax deductions in a given tax year - because of closing gaps in your occupational pension fund or renovating your home, for example - then you should consider not contributing to the pillar 3a in that same year. The reason is that, because your taxable income is already reduced, you will not get the maximum tax benefit from the pillar 3a deduction. In these situations, it usually makes more sense to wait and then make the pillar 3a contribution for that year in arrears in a different tax year when you cannot claim other deductions. 

What are the requirements for making pillar 3a contributions in arrears?

There are some criteria that have to be met in order to be able to close pillar 3a gaps in arrears. The most important points to consider are:

• There is a 10-year limit for contributions in arrears. 2025 is the first year for which you can contribute in arrears. It is not possible to close gaps for the years 2024 and earlier.
• You can only make pillar 3a contributions for years in which you earned an income on which you had to pay OASI contributions. If you are employed, OASI contributions are deducted from your salary by your Swiss employer.
• Paying pillar 3a contributions for a past year in arrears is only possible once you have already paid the maximum pillar 3a contribution for the current year.
• If there is a gap in your pillar 3a from a previous year, the payment made in arrears to close that gap has to be made in one tax year. You cannot stagger the pillar 3a payments in arrears for a past tax year over more than one year.
  Once you make a standard withdrawal from the pillar 3a for retirement (possible from age 60), you cannot make any more contributions in arrears to close gaps.
• You have to submit a written application informing your pillar 3a retirement foundation that you want to make a payment in arrears for a previous year. The foundation should provide an application form.

More on this topic:
Compare pillar 3a savings accounts now
Compare pillar 3a retirement funds now
Compare pillar 3a asset management services now
How to use the pillar 3a to save on taxes
How to find the right pillar 3a solution
The Swiss three-pillar system explained