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Old 09.03.2008, 18:53
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Re: Freizuegigkeitskonto [vested benefit account]

The exact algorithm for calculating the obligatory part is explained in another thread, which you can search. It is the contribution for the salary between the lower limit (about 20K, verify!) and the upper limit (about 90k, verify!). You will see the calculation in your pension plan statement.

If you have a salary above the upper limit, then you would have vested benefits beyond the obligatory. Your pension-plan statement would reflect the contributions that accumulated in the supra-obligatory part.

Ask your pension-plan administrator whether there are any gaps in your pension plan. Based on their feedback, you can fill it up and claim deduction from taxable income. If you can, it is better to top-up split over several years, assuming you are going to be here.

When you leave Switzerland, the redemption of your pension plan depends on where you are moving to. The supra-obligatory part can be cashed out. The obligatory part can only be transfered to a pension-plan in your destination country, if the destination is a EU country. Otherwise, you can cash out the obligatory part, too.

Cash out redemptions are taxable in Switzerland! Hence, a detailed calculation is needed to determine whether a net tax benefit results. Usually, it is beneficial.

Moreover, your destination country may also want to tax the redemptions, unless there is relief envisaged in DTAA (Double Taxation Avoidance Agreements) between Switzerland and your destination country.
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