Third pillar insurance for the self-employed: our comprehensive guide
12 May 2026
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Guillaume Chassot
Self-employed people now account for around 1 in 11 working people in Switzerland. As they are self-employed, they must take care of their own social insurance, their loss of earnings insurance in case of accident or illness, and their pension provision. In this article, we provide an overview of the pension solutions available to the self-employed and, above all, the importance of taking out third pillar insurance when planning for retirement or in the event of unforeseen circumstances.
Pension provision for the self-employed: compulsory or optional?
In Switzerland, anyone working on a self-employed basis is required to manage the majority of their own pension provision. Whilst contributions to the first pillar are compulsory, contributing to the second pillar insurance (“occupational pension benefits”) is optional.
First pillar insurance is compulsory, but the AVS/AI pension is insufficient
The first pillar (AVS/AI) or state pension scheme is the only legally mandatory pillar to which the self-employed must contribute. However, once you reach retirement age, if you rely solely on the first pillar, your pension may unfortunately be insufficient. As a reminder, the maximum AVS/AI pension is CHF 2,520 per month for a person who has contributed continuously for 44 years with an average annual income of at least CHF 90,720. This also applies to the risks of disability and death, which are not adequately covered by the first pillar alone.
Optional contributions under the second pillar
Unlike employees, who are compulsorily contribute to a pension fund via their employer, self-employed workers are not required to contribute to the second pillar (LPP/BVG). Joining an LPP/BVG pension scheme is in fact required for people with employee status who earn at least CHF 22,680 per year.
Third pillar insurance: a suitable option for the self-employed
The third pillar, and in particular Pillar 3a (tied pension provision), is the most sensible solution for boosting your pension provision as a self-employed person. Tax-efficient, it also allows you to bridge any gaps in your pension provision once you retire, whilst providing better cover against unforeseen events. In addition, self-employed people also have the option of protecting their loved ones and their assets with disability or life insurance.
We often forget that self-employed people shouldn’t focus solely on saving. They also need to plan for the financial consequences of becoming unable to work or in the event of death. These risks can be covered either as a supplement to savings or as a completely separate policy.
How much should you pay into the third pillar insurance annually?
For Pillar 3b, there is no maximum contribution limit. For Pillar 3a, in 2026, the maximum permitted contribution for self-employed individuals not affiliated with the LPP is 20% of annual income/profit (but not exceeding CHF 36,288).
As well as making tax savings each year, the savings accumulated in your tied pension plan are exempt from wealth tax until maturity, and when you receive your capital, you will benefit from reduced taxation, separate from your other income.
Practical examples of tax savings with Pillar 3a
As the amount you pay into your Pillar 3a each year is deductible from your taxable income, you can make significant tax savings as well as build up savings for retirement. Here are two examples based on a standard tax situation, for illustrative purposes:
Aline, aged 30, a podiatrist, lives in Fribourg and earns CHF 60,000 a year. Aware of the importance of building up a third pillar as part of her pension provision, she decides to pay in CHF 800 a month. Her annual tax savings will amount to CHF 1,698 a year.
Laurent, aged 40, a dentist, lives in Sion and earns CHF 200,000 a year. He too is aware of the importance of building up a third pillar and decides to pay the maximum authorised amount, which amounts to CHF 36,288 a year. In his case, his annual tax savings will amount to CHF 15,521 a year.
3a insurance via a bank or an insurance: which should I choose?
From 2026, it is now possible to make retroactive contributions to your Pillar 3a for the years 2025 and onwards, provided the annual maximum limit has not been reached. For the self-employed, the retroactive Pillar 3a top-up is capped at the “small contribution”, i.e. CHF 7,258. As with payments into Pillar 3a, these top-ups are also tax-deductible.
New: retroactive top-ups to Pillar 3a
Depuis 2026, il est désormais possible de racheter des cotisations dans votre pilier 3a pour les années 2025 et suivantes, si le plafond maximal annuel n’a pas été atteint. Pour les indépendants, le rachat rétroactif 3a est plafonné à la « petite cotisation », soit CHF 7'258. Comme pour les versements dans le pilier 3a, ces rachats de cotisation sont aussi déductibles du revenu imposable.
Pension provision for the self-employed: frequently asked questions
What is the compulsory pension pillar for a self-employed person in Switzerland
The only compulsory pension scheme for the self-employed is the first pillar (AVS/AI). It provides basic cover in the event of retirement, disability or death. Unlike employees, the self-employed person pays the full amount of their contributions themselves, calculated on the basis of their income.
Can a self-employed person contribute to the second pillar (pension fund – LPP/BVG)?
Yes, the second pillar (LPP/BVG) is optional but available to the self-employed. It is possible to join a pension fund voluntarily, particularly via a collective institution or an industry-specific fund. This solution allows you to contribute to your occupational pension, cover the risks of disability or death, and maximise your retirement savings.
Why are contributions into the third pillar essential for the self-employed?
Simple to set up, flexible and suited to variable incomes, the third pillar is essential for supplementing the pension provision of the self-employed, as the AVS/AI is generally insufficient to maintain one’s standard of living in retirement. In addition, it offers a tax-efficient individual savings solution that is particularly relevant when one does not contribute to the second pillar.
About the author
Guillaume Chassot
Head of Business Development Pensions for French-Speaking Switzerland
