3rd pillar: 3A or 3B?
What’s best for me? 3rd pillar 3A or 3B?
These two savings solutions are similar in several respects mbut there are crucial crucial differences interms of freedom, taxation and inheritance..
In general if you don’t already have a 3rd pillar, it’s probably the 3A that you needbecause it’s tax-deductible everywhere, and therefore more attractive from a tax point of view.
However, there are
cases where 3B may be preferable
for example:
– Passing the benefit on to someone other than yourself
– In the event of the death of a person who is neither your child nor your spouse
– Be able to withdraw the amount at any time, without having to meet any of the 3A withdrawal conditions
– Save more than 3A amounts
In the cantons of Geneva and Fribourg, it’s not uncommon to do both, as 3B is also deductible up to a certain amount.
The following table summarizes the main differences between Pillar 3A and Pillar 3B:
3A
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Tax-deductible anywhere in Switzerland
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Up to 7,056.00 per year (588.00 per month)
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Allows indirect amortization (real estate)
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No wealth tax
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Taxed at reduced rate on withdrawal
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Withdrawal conditions (retirement, housing, etc.)
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3B
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No maximum amount
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Unrestricted beneficiary clause (inheritance)
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No withdrawal conditions
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Deductible in Geneva (2,200.-) and Fribourg (750.-)
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No tax on withdrawal
-
Taxed on wealth
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Our 3rd pillar comparator
We have created a neutral, free online comparator that allows you to compare all 3rd pillar 3A and 3B solutions in just a few minutes.
What’s more, at the end of the process we offer you a free telephone appointment with one of our expert pension advisors, who will give you a personalized explanation of the advantages and disadvantages of each solution!
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