What are the Pillar 3a (Säule 3a) deduction limits for 2025?

For 2025, employees with a second-pillar (BVG) occupational pension can contribute and deduct up to CHF 7,258 per year into Pillar 3a. Self-employed persons without a BVG pension fund can deduct up to 20% of their net earned income, with an absolute cap of CHF 36,288. These limits are indexed to the AHV maximum pension and adjust annually.

Contributions must be made by December 31 to count for that tax year — transfers made in early January are counted in the following year. You can contribute to multiple 3a accounts (since the 2024 legislative clarification allowing retroactive catch-up contributions was being discussed, though the base annual cap remains firm). Staggering accounts across different providers, including 3a investment accounts at banks or insurance wrappers, is a standard planning strategy.

At withdrawal, the lump sum is taxed at a reduced rate separately from ordinary income. The cantonal rate varies widely: Schwyz is around 2-3% on typical withdrawal amounts, while Zurich runs 5-7%. Spreading withdrawals across multiple tax years by holding several accounts and closing them in different years remains the most effective way to reduce the tax cost at retirement.

This is general information only, not professional tax advice. Consult a qualified tax professional for your specific situation.