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  #161  
Old 17.11.2009, 23:18
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Re: 3rd Pillar Pension Fund

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I understand that the tax deductibility of the 3a contribution is
- some 6.5k if I pay into a 2nd pillar
- some 30k if I don't (or am self-employed)

My question is - is the status determined for the year, or at the end of the year?

More specifically, I was made redundant at the end of June. Hence I contributed into the company pension plan and paid AHV for half the year.

For the second half of the year, I am receiving unemployment, and still paying AHV, but no longer contributing to a pension plan.

Which category do I fall under??

my own guess (and hope) is that I can slip now into the second category and save a lot of tax by contributing say 20k into a 3a account?
The "some 30k" is the max 3a contribution! The rule is 20% (if you have not contributed to a pension plan during the year) capped at approx 30k. To contribute and deduct the full amount, you must have a gross income of at least 150k.

Recipients of unemployed benefits are treated like employees contributing to a pension plan, i.e. 6.5k max.
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  #162  
Old 20.11.2009, 13:25
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Re: 3rd Pillar Pension Fund

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Recipients of unemployed benefits are treated like employees contributing to a pension plan, i.e. 6.5k max.
Except that when you're receiving unemployment benefits you are not making any contributions to the 2nd Pillar. I find this quite strange since it contradicts the "30k limit for the 3rd pillar is for [self employed] people who don't [can't] pay into the 2nd pillar" argument.
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  #163  
Old 20.11.2009, 20:09
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Re: 3rd Pillar Pension Fund

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Except that when you're receiving unemployment benefits you are not making any contributions to the 2nd Pillar. I find this quite strange since it contradicts the "30k limit for the 3rd pillar is for [self employed] people who don't [can't] pay into the 2nd pillar" argument.
Strictly speaking, you have no real income when unemployed. So you can 3a contribute 20% of zero, which is zero. It is already a big concession that they let you contribute and deduct 6.5k.
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  #164  
Old 28.11.2009, 10:35
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Re: 3rd Pillar Pension Fund

Hello.

As I explain here, starting December 1 I will be working in Switzerland without having received my permit extension.

I am wondering if I can still open a 3rd pillar account under this status. Can somebody help?
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  #165  
Old 02.12.2009, 17:09
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Re: 3rd Pillar Pension Fund

Gah, gotta sign up or I'm not going to get it done for another year.

I've currently got my money sitting around doing nothing, so I'm going to stick the maximum amount in each year.

I basicaly just want this unused cash put away and claim the tax back and have the funds appreciate above inflation.

For simplicity, I was tempted by UBS simply because I bank with them and the website is in english. Unfortunately their online financial planner thingy advised me my money would be better off in the helpfully titled "other investment".

Are there better alternatives, in English, to be looking at? And I mean simple and safe schemes for a financial dullard like me.

EDIT: Just saw comparis offer more options.
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  #166  
Old 02.12.2009, 19:33
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Re: 3rd Pillar Pension Fund

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Gah, gotta sign up or I'm not going to get it done for another year.

I've currently got my money sitting around doing nothing, so I'm going to stick the maximum amount in each year.

I basicaly just want this unused cash put away and claim the tax back and have the funds appreciate above inflation.

For simplicity, I was tempted by UBS simply because I bank with them and the website is in english. Unfortunately their online financial planner thingy advised me my money would be better off in the helpfully titled "other investment".

Are there better alternatives, in English, to be looking at? And I mean simple and safe schemes for a financial dullard like me.

EDIT: Just saw comparis offer more options.
Rate comparison as of 1st Dec 2009
http://www.123-pensionierung.ch/imag...-saeule-3a.pdf
UBS offers 2.25%. PostFin offers 2.5%. Highest is BPS at 2.75%
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  #167  
Old 02.12.2009, 23:41
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Re: 3rd Pillar Pension Fund

As you'll see on the comparis.ch tables in english returns on the investment product for 3a aren't great for the last few years with most LOSING money.

For the moment it may be worthwhile sticking to cash, although unlike the Pillar 2 there isn't a minimum return specified in the law. This is one of the aims of the fair-rente campaign which may lead to a referendum via popular initiative.
(To say nothing of the returns on the state Pillar (AHV/AVS).

In addition it's possible to contribute to a life insurance product (with or without investment, personally I'd stick to a term-life and I work in insurance) as part of a Pillar 3b. These premiums also tax deductible.

A benefit of the Postfinance online system is that through their internet portal you can keep an eye in one place on how your funds are doing. They also pay interest every 6 months, not just once a year like a lot of accounts. With a little change after 1 fully years contribution the yearly fees are waived for your main account (currently 7500 for standard banking).
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  #168  
Old 03.12.2009, 09:05
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Re: 3rd Pillar Pension Fund

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As you'll see on the comparis.ch tables in english returns on the investment product for 3a aren't great for the last few years with most LOSING money.

For the moment it may be worthwhile sticking to cash, although unlike the Pillar 2 there isn't a minimum return specified in the law. This is one of the aims of the fair-rente campaign which may lead to a referendum via popular initiative.
(To say nothing of the returns on the state Pillar (AHV/AVS).

In addition it's possible to contribute to a life insurance product (with or without investment, personally I'd stick to a term-life and I work in insurance) as part of a Pillar 3b. These premiums also tax deductible.

A benefit of the Postfinance online system is that through their internet portal you can keep an eye in one place on how your funds are doing. They also pay interest every 6 months, not just once a year like a lot of accounts. With a little change after 1 fully years contribution the yearly fees are waived for your main account (currently 7500 for standard banking).
3a
Pre-tax assets (max CHF 6.5k pa) can be put into a plain-vanilla savings account Presently (1st Dec 2009) best rate is 2.75%. No risk upto CHF 100k. Or the assets can be put into various fund-plans that invest in stocks, bonds, etc. Then, of course, you are exposed to market risks. My emphatic advice: stick to plain vanilla! Where else do you get zero-risk tax-free 2.75%?

3b
Post-tax assets can be used unlimited to buy life-insurance linked products. There is no tax-deduction because tax has already been paid! The assets are wealth taxed. The yield is tax free if held for minimum 5 or 10 yeras (depending on product).
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  #169  
Old 03.12.2009, 09:13
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Re: 3rd Pillar Pension Fund

Comparis.ch shows the post office as one of the highest (safe) 3a account locations. Does anybody already have a pension with these people, I thinking of switching from UBS.

No faith in funds with claims like credit suisse 7.5%, this is too to be true.

Mark
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  #170  
Old 03.12.2009, 09:59
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Re: 3rd Pillar Pension Fund

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Strictly speaking, you have no real income when unemployed. So you can 3a contribute 20% of zero, which is zero. It is already a big concession that they let you contribute and deduct 6.5k.
Don't see your logic as the 3rd Pillar is not income related, there's no requirement to have an income, only residence/citizenship and be of working age.
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  #171  
Old 03.12.2009, 10:01
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Re: 3rd Pillar Pension Fund

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3a
Pre-tax assets (max CHF 6.5k pa) can be put into a plain-vanilla savings account Presently (1st Dec 2009) best rate is 2.75%. No risk upto CHF 100k. Or the assets can be put into various fund-plans that invest in stocks, bonds, etc. Then, of course, you are exposed to market risks. My emphatic advice: stick to plain vanilla! Where else do you get zero-risk tax-free 2.75%?

3b
Post-tax assets can be used unlimited to buy life-insurance linked products. There is no tax-deduction because tax has already been paid! The assets are wealth taxed. The yield is tax free if held for minimum 5 or 10 yeras (depending on product).
Are you sure? Why is there in Kt. ZH in the "Berufsauslagen/Professional deductions" section of the Tax return a box number 603 in the "Insurance Premiums/Versicherungsprämien" entitled for "Private life and retirement insurance"?

see: http://www.steueramt.zh.ch/cgi-bin/g...0208baa269.pdf
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  #172  
Old 03.12.2009, 10:03
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Re: 3rd Pillar Pension Fund

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Comparis.ch shows the post office as one of the highest (safe) 3a account locations. Does anybody already have a pension with these people, I thinking of switching from UBS.

No faith in funds with claims like credit suisse 7.5%, this is too to be true.

Mark
Be careful what you mean. In the same way Postfinance sells 3b life insurance products branded as Postfinance, it's actually an Axa Winterthur product.

In addition the 3a account visible in your Postfinance portfolio is actually vested with the UBS Pension Fund Foundation in Basel.
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  #173  
Old 03.12.2009, 21:28
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Re: 3rd Pillar Pension Fund

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Don't see your logic as the 3rd Pillar is not income related, there's no requirement to have an income, only residence/citizenship and be of working age.
Not true. Permitted 3a contributions are:
  • If employee and in a pension plan, then max contribution ca 6.5k.
  • If self-employed, then max contribution is 20% of income, but capped at ca 32k.
No contributions permitted if you have no income. income.

Also contributions are taxed when you eventually withdraw. So if you could not previously deduct, then you are afterward paying taxes! Who would want that?
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  #174  
Old 03.12.2009, 21:33
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Re: 3rd Pillar Pension Fund

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Are you sure? Why is there in Kt. ZH in the "Berufsauslagen/Professional deductions" section of the Tax return a box number 603 in the "Insurance Premiums/Versicherungsprämien" entitled for "Private life and retirement insurance"?

see: http://www.steueramt.zh.ch/cgi-bin/g...0208baa269.pdf
Usually the medical insurance exhausts this allowance, which is capped (see box 612) at CHF 2'400. Or do you know anyone paying less than CHF 2'400 for health care insurance?
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  #175  
Old 03.12.2009, 21:35
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Re: 3rd Pillar Pension Fund

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Be careful what you mean. In the same way Postfinance sells 3b life insurance products branded as Postfinance, it's actually an Axa Winterthur product.

In addition the 3a account visible in your Postfinance portfolio is actually vested with the UBS Pension Fund Foundation in Basel.
That is correct. However, CHF 100k is insured at any one Bank. Very few persons have more than 100k in 3a. Remember you can have 2 or 3 such accounts at different Banks.
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  #176  
Old 04.12.2009, 08:26
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Re: 3rd Pillar Pension Fund

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Not true. Permitted 3a contributions are:
  • If employee and in a pension plan, then max contribution ca 6.5k.
  • If self-employed, then max contribution is 20% of income, but capped at ca 32k.
No contributions permitted if you have no income. income.

Also contributions are taxed when you eventually withdraw. So if you could not previously deduct, then you are afterward paying taxes! Who would want that?
I do not work but I do have an income from renting my house? Does this count??
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  #177  
Old 04.12.2009, 22:25
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Re: 3rd Pillar Pension Fund

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I do not work but I do have an income from renting my house? Does this count??
No. Only incomes, on which AHV is paid, qualify for 3a deductions.

Hence rental income, dividends, capital-gains, interests, etc. all do not qualify. But then you are exempt from the AHV
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  #178  
Old 22.12.2009, 17:51
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Re: 3rd Pillar Pension Fund

Partly for my file and also because it took me ages to find:

The 2009 Pillar III limit for working people is 6566 CHF

(Now it would be nice if our new company pays us before Xmas - but maybe that's asking too much...)
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  #179  
Old 22.12.2009, 19:19
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Re: 3rd Pillar Pension Fund

Hello there,

I have been looking on line at several locations and could not find information for 2010 regarding the maximum amount that can be put in the Pillar 3a. Anyone out there got a link showing the amount that can be put away for people working for an employer (not self employed) in 2010?

thanks and happy holidays.
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  #180  
Old 22.12.2009, 19:49
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Re: 3rd Pillar Pension Fund

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Hello there,

I have been looking on line at several locations and could not find information for 2010 regarding the maximum amount that can be put in the Pillar 3a. Anyone out there got a link showing the amount that can be put away for people working for an employer (not self employed) in 2010?

thanks and happy holidays.
it will certainly be more than 6500, but what does it matter?
you can't make 2010 contributions now anyways.
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