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Old 06.07.2014, 20:29
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Pillar 2 Extra Contributions

Maybe someone can help, I'm not sure how much I'm allowed to add to my Pillar 2 as a voluntary contribution and get a tax deduction for it. I know the size of the hole from the form they send, but it's not clear to me if I fill it all at once or there's a maximum.

Example:
100k hole
100k Salary

Can I put all 100k in one year and have a 100k tax credit, fully off-setting for taxes (I know there would be more savings if spread over multiple years)

I've read in some placed you can only pay in max 20% of your salary (=20k each year for 5 years), or 'insured salary', but some places I read that is only for people less than 5 years in CH. I'm here 12...Is there a maximum?

Thanks for any help/links!

Andrew
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Old 06.07.2014, 20:40
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Re: Pillar 2 Extra Contributions

The information I was given from my company pension advisor is that after you have been in Switzerland over 5 years, there is no limit to the extra you can put into your Pillar 2 pension (up to 100%) of your salary each year.

Before 5 years here, it is as you say, max 20% of salary.
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Old 06.07.2014, 20:44
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Re: Pillar 2 Extra Contributions

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Maybe someone can help, I'm not sure how much I'm allowed to add to my Pillar 2 as a voluntary contribution and get a tax deduction for it. I know the size of the hole from the form they send, but it's not clear to me if I fill it all at once or there's a maximum.

Example:
100k hole
100k Salary

Can I put all 100k in one year and have a 100k tax credit, fully off-setting for taxes (I know there would be more savings if spread over multiple years)

I've read in some placed you can only pay in max 20% of your salary (=20k each year for 5 years), or 'insured salary', but some places I read that is only for people less than 5 years in CH. I'm here 12...Is there a maximum?

Thanks for any help/links!

Andrew
I once put in 45% of salary however they restricted the amount since then. You might want to think carefully as the tax saved is not that much. Your annual tax liability is about 15K.
There is tax to pay on withdrawal, you loose the use of the money. As there is no CGT in CH. You could invest & let the money grow tax free without a pension.
Remember taxes in ZH are very low.
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Old 06.07.2014, 21:01
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Re: Pillar 2 Extra Contributions

The amount you can pay into your 2nd pillar will depend on a variety of factors and it's the caisse which will be able to tell you how much you can pay in.
The totality of the amount you pay in is tax-deductible. Note, in many cases, the tax is the primary reason for making payments into the 2nd pillar. Also it's also worth spreading the in-payments over several years.
Note also, that you won't be able to withdraw your capital from the 2nd pillar if you do this, or at least not if you pay in during the last 5 years of your career, or else the tax people will get back at you.
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