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Old 06.12.2008, 23:23
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Re: What pensions become

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I have tried to carefully read the information here on pensions and tax-optimisation; thanks a ton for all the useful posts. Being new to Suisse, I am trying to work out the contribution etc. Most of my questions have been answered already, but dare I ask for a clarification? Clearly, you can contribute to pillar 3a on a pre-tax basis. Is that true for pillar 2 (i.e. your company pension) as well? I presume it is, but no one has said so explicitly here...

The reason I ask this is that my company has now offered a choice to increase my (i.e. employee) contribution by a couple % pts or so, with their contribution remaining unchanged. If I am comfortably able to put some extra money aside this way, is this a no-brainer? obviously assuming that this will be pre-tax as above. Any reason why it may not be tax-efficient to do so?
Contributions to the pension plan are generally deductible from taxable income. However, there is some tax on redemption.

Before you invest into a company plan, verify whether the pension plan is fully funded. Many pension plans have deficits because of the recent sharp drop in equities and bonds.
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