Several Pillar 3a accounts: Save on taxes through splitting

In addition to OASI and your pension fund, having several Pillar 3a accounts offers you the opportunity to optimize your pension provision and save on taxes when it is paid out. We show you how splitting works, how many accounts make sense, and the advantages. 

A well-thought-out pension strategy and a clear structure of your Pillar 3 plan can make a noticeable difference when it comes to payments in retirement. If you want to optimize your pension provision, you may have asked yourself the following question: Can I have several 3a accounts? Especially if you have or are planning to have several Pillar 3a accounts, it’s important to review your pension strategy regularly and adjust it if necessary.

What are the advantages of having several Pillar 3a accounts?

• Pillar 3a withdrawals in stages (splitting): The 3a credit balance must be withdrawn in full for each account (no partial withdrawals). Multiple accounts allow payments to be spread out over several years and thus optimize tax planning.
• Flexible withdrawal from Pillar 3a: Payments are possible between five years before and five years after retirement age (deferral only if you are in continued gainful employment). This makes it easier to adapt the payment to your personal situation.
• Save on taxes with a Pillar 3a payment: Lump sum payments are taxed progressively. Several smaller withdrawals result in a lower tax burden than a one-time, large payout. In our article on withdrawing Pillar 3a, we show you what you should bear in mind and what tax rates currently apply.
• Continue investing: If you do not withdraw all of your 3a assets, the remainder remains in place. This way, you can continue to earn interest or – with a securities solution – take advantage of additional return opportunities.
• Risk spread across several providers: Pillar 3a assets are subject to the bankruptcy privilege, but not to deposit insurance. In the event of bankruptcy, pension assets of up to CHF 100,000 per person are privileged. Having several Pillar 3a accounts with different providers spreads risk and increases security.

Can I switch my Pillar 3a account?

If you already have a 3a account but would like to change provider or product, you can do so at any time. When switching, the entire 3a credit balance from the existing account will be transferred to a new 3a account. A partial transfer of the assets or a transfer to a normal savings account is not possible.

Switching to a different Pillar 3a account can be worthwhile in particular if you benefit from better conditions and lower fees with a different account. Please note that, depending on the provider, notice periods or fees may apply.

Are there restrictions when it comes to several Pillar 3a accounts?

Several Pillar 3a accounts offer advantages for tax planning, but are subject to a clear legal framework:

Maximum amount remains limited

• The annual maximum contribution into Pillar 3a is defined by law.
• This amount is per person, regardless of the number of accounts.
• Deposits can be spread over several accounts, but the total cannot be exceeded.

Tax aspects for married couples

• Married couples are taxed jointly on Pillar 3a lump sum payments (provided they do not live separately).
• Due to tax progression, withdrawals made in the same year may result in a higher tax burden.
• Coordinated planning of payments can be advantageous for married couples in particular.

How many Pillar 3a accounts are advisable?

In practice, for most savers two to three accounts are recommended, while for larger assets, up to five accounts are recommended. How many Pillar 3a accounts make sense depends on your savings history, the capital you have saved, and the tax treatment in your canton.

Two to three accounts: Makes sense for many savers

For most people, two to three Pillar 3a accounts are enough to take advantage of the benefits.

This allows you to spread your assets over two to three years and reduce your tax progression. This option is particularly suitable for total 3a savings of up to CHF 150,000.

Five accounts: Makes sense for larger credit balances

If you have made regular contributions into Pillar 3a over many years and have thus been able to accumulate a larger amount of pension capital, it may be worthwhile to split it into five accounts.

You can stagger the payouts over five to six years to save as much on taxes as possible. Ideally, you should not just keep these accounts with a bank or occupational benefits institution, but rather split several Pillar 3a accounts between two or three providers.

How do you benefit from multiple Pillar 3a accounts?

If you split your Pillar 3a account, you can withdraw your pension capital on a staggered basis, save on taxes, and give you more flexibility in your planning.

You should therefore plan early and adjust the number of Pillar 3a accounts to your personal situation. This way, you can make the most of your private pension provision.

Further questions on multiple Pillar 3a accounts