Hi,
I worked in Switzerland for 8 years and am currently in the UK. At the moment, my 2eme pillier is still with the company I paid into. I am planning on returning to Switzerland this summer all being well and have a few questions.

If I took the money out and transferred it to the UK, can I come back to Switzerland? I have been told that I might not be allowed back to work but I can't find any reference to that via online searches.

If I take the money does anyone know if it will be taxed and if so at what %?

If I leave it, can I use it at a later date to buy a house in the UK or can it only be used for property in CH?

Thanks for any advice given!

Note that you cannot "take the money out". It has to be transferred to the UK pension system. The only part that you can take out in cash is the "super-obligatory" contributions, i.e. contributions paid in above the 75'000 ish salary treshold.

It does, but the % depends on your yearly income.

You cannot use it for property purchase abroad.

Thanks Shorrick - that makes the decision easy then - it stays where it is!!!

Please see pages 25 - 27 of attached document. It seems that buying of property outside Switzerland is possible...

Attached Files

Leaving_Switzerland.pdf (846.8 KB, 715 views)

but I thought if you no longer worked with the employer the money HAD to taken out and at least placed in a special Vested benefit account until you could move it to the scheme of your new employer. Is that not correct?

HEvd - thanks for this. I had found a version for non EU people but had not found this one!

Bill_door - I do have to do something with it - which was going to just be in a different account with the same people until I come back as I will be working for the same employer.

To be able to answer your question, your exact situation should be known more in details.
As you want to return to Switzerland, I suppose that you have not being deregitered at the communitiy....therefore a cash payment of your vested benefit would be possible....
If you pass through a vested benefit foundation in the canton of Schwyz (e.g. PensFree) then you pay max. 4.8% as tax at source....It does not depend on your income.

Legally, you can use as well the mandatory portion to buy a house abroad......

Nope not necessarily, you always have 4 options:

1. Leave it vested for a period or in a free standing account nominated by the fund (eg Swiss life used to put it in their daughter bank Banco del Gottardo)
2. Move it to a free standing account of your choice in your own bank
3. Use it to pledge/transfer for a property or setting up a company as self employed
4. Transfer to another pension/Cash it out subject to conditions incl. retirement age, self-employment status, duration of contribution, nationality (EU/EEA/CH), permanently leaving Switzerland etc.

Depends basically, not to mention difficulties moving funds from outside CH to here after arrival/before retirement.

all which amount to it LEAVING the company pension scheme! so as I thought before it has to be withdrawn and at least deposited in a vested account or take the cash and the tax hit.

I am still registered at the commune as I have the intention of returning and asked to keep my permit for a year - can you explain why/how you think a cash payment is possible?

And as far as I know I can only use the money to buy a house if it is going to be my principal home - ie I live there - or for my family - and that applies for CH and UK - is that different to what you know?

To be able to answer your question, your exact situation should be known more in details.
As you want to return to Switzerland, I suppose that you have not being deregitered at the communitiy....therefore a cash payment of your vested benefit would be possible....
If you pass through a vested benefit foundation in the canton of Schwyz (e.g. PensFree) then you pay max. 4.8% as tax at source....It does not depend on your income.

Legally, you can use as well the mandatory portion to buy a house abroad......



I am still registered at the commune as I have the intention of returning and asked to keep my permit for a year - can you explain why/how you think a cash payment is possible?

And as far as I know I can only use the money to buy a house if it is going to be my principal home - ie I live there - or for my family - and that applies for CH and UK - is that different to what you know?

Dear Fudge,

Sorry for this confusion,.....I should have written it more clearly...
A cash payment is NOT possible as long as you have not been deregistered officially in Switzerland.

The fact that you have asked to maintain your permit is a proof that you have not left Switzerland permanently....so once this is done, then you can ask for the cash payment.

If you have settled down in a EU-country, then you cannot cash in the mandatory part...except you do it for buying a house....The condition is that you are living yourself in your property abroad...

Not sure if this is the right forum, but I have a 2nd pillar question. We put down a down payment on a new construction project last week. At the last minute we were short some of the funds, which we borrowed from a family member, expecting to pay it right back to them from a 2nd pillar account from a previous employer. Now I've learned that they will only transfer the funds to the seller. Is there any way around this? I can prove quite easily that the money is going to pay back the loan we borrowed for the down payment since the family member transfered the funds directly to the seller, and we signed a loan agreement ... Any ideas would be appreciated!

You can only pay to the seller, however you could pay your bank, and then maybe take out cash from your mortgage and pay your family.

Go discuss with your bank, insist that the payment will be by bank transfer only, no cash, and get prove your family lent you the same amount of money.

By the way, if you are already short of funds on a building project, you're going to have dificulties later on.

Thanks. Working with the bank might actually work, seller is less likely solution.

We are only short because of cash flow timing issues. We're trading up - couldn't sell 'til we had something to buy (gewinnsteur), needed cash from the existing apt to make the down payment for the second, but seller would not wait until we sold, too many people interested in the new apt ... Cash crunch should be over in about three months.