3rd pillar for the self-employed

As a self-employed person in Switzerland, the 3rd pillar is your main lever for pension planning and tax optimisation. Without a mandatory 2nd pillar, you benefit from an increased 3a limit of CHF 36 288.- per year. This guide explains how to make the most of it.

Why the 3rd pillar is crucial for the self-employed

The Swiss pension system rests on three pillars. For employees, the 1st pillar (AHV/OASI) and the 2nd pillar (BVG) together cover approximately 60% of the last salary. But self-employed persons have a very different situation:

• 1st pillar (AHV/OASI): mandatory, but the maximum pension only covers vital needs (CHF 2,450.- per month maximum for a single person in 2026)
• 2nd pillar (BVG): not mandatory for the self-employed. You can join voluntarily, but many do not.
• 3rd pillar: becomes de facto the main pillar of your retirement provision, with a high limit to compensate for the absence of BVG

Without a 2nd pillar, a self-employed person risks receiving only the AHV pension at retirement, representing a replacement rate of 20 to 30% of their last income. The 3rd pillar is therefore vital to bridge this gap and maintain your standard of living.

The increased limit: CHF 36 288.- per year

The law recognises the particular situation of self-employed persons without a pension fund by granting them a significantly higher 3a limit:

The increased limit represents 5 times the employee limit. This is a considerable tax advantage: a self-employed person contributing the maximum of CHF 36 288.- with a marginal rate of 35% saves approximately CHF 12,700.- in taxes per year.

For more details on limits, see our page on the maximum 3rd pillar amount.

Calculating the limit for self-employed persons

Calculating the 3a limit for a self-employed person without BVG follows these steps:

1. Determine your net earned income: this is your business profit, after deduction of professional expenses and personal AHV/IV/APG contributions.
2. Calculate 20% of this amount: this is your theoretical limit.
3. Apply the maximum: if the result exceeds CHF 36 288.-, the limit is capped at this amount.

Concrete examples

• Net income of CHF 80,000.-: 20% = CHF 16,000.- -> 3a limit = CHF 16,000.-
• Net income of CHF 120,000.-: 20% = CHF 24,000.- -> 3a limit = CHF 24,000.-
• Net income of CHF 200,000.-: 20% = CHF 40,000.- -> 3a limit = CHF 36 288.- (maximum reached)

3rd pillar or voluntary 2nd pillar?

As a self-employed person, you have the choice between:

• Option A: no 2nd pillar + increased 3a limit (CHF 36 288.-)
• Option B: voluntary 2nd pillar + reduced 3a limit (CHF 7 258.-)

Option B allows a potentially higher total deduction (BVG contributions + 3a), but involves less flexibility. Option A is often preferred for its simplicity and the flexibility of the 3rd pillar. The best choice depends on your income, age and objectives. We recommend simulating both scenarios with an advisor.

Pension strategies for the self-employed

1. Maximise the 3a contribution each year

Contribute the maximum deductible amount each year. Even if your income fluctuates, adjust your contributions accordingly (the limit follows income). Do not forget the retroactive buy-back to fill years where you did not reach the maximum.

2. Open multiple 3a accounts

With large amounts, it is even more crucial to spread across multiple accounts (ideally 5 to 7 for self-employed persons at the maximum limit). This allows you to stagger withdrawals and limit tax progression.

3. Combine bank and insurance

Without BVG, you lack disability and death coverage. A 3a insurance contract with premium waiver and death capital fills this gap. Complement with a bank 3a for returns. See our guide bank or insurance.

4. Invest according to your horizon

If you are far from retirement, favour equity funds for better long-term returns. As retirement approaches, gradually secure your capital with bond funds or a savings account.

5. Consider a complementary pillar 3b

If your savings capacity exceeds the 3a limit, a pillar 3b allows you to continue building capital, with total withdrawal flexibility.

The concrete tax impact

The tax saving for a self-employed person contributing the maximum to pillar 3a is considerable:

Use our tax savings calculator for a precise estimate based on your canton and situation.

Common mistakes to avoid

• Not contributing at all: postponing pension planning is the worst mistake. Every lost year considerably reduces your final capital.
• Joining BVG without evaluating the impact on the 3a limit: voluntary affiliation with the 2nd pillar reduces your 3a limit from CHF 36 288.- to CHF 7 258.-. Do the overall calculation before deciding.
• Forgetting risk coverage: without BVG, you have no disability pension or professional death capital. A 3a insurance with premium waiver is often indispensable.
• Putting everything in a single account: with large amounts, the tax on withdrawal can be heavy. Spread across multiple accounts.

Get personalised advice

Every self-employed person's situation is unique. Discover how to open a 3rd pillar or request a free personalised quote to receive a pension strategy tailored to your income, age and objectives. Our advisors specialise in pension planning for the self-employed in Switzerland.