Save taxes in Switzerland
January 22, 2025
7 min read
arvy's Teaser: Most "save taxes in Switzerland" articles give you 10 generic tips you already know: "pay into 3a", "collect receipts", "donate to charity". Yawn. This article is different. We've ranked deductions by impact — from "saves thousands" to "saves a few francs" — and show you for each income bracket which levers actually matter. Plus: the mistakes that cost you the most, and the new rules from 2026.
The Swiss Tax System in 30 Seconds
You pay taxes on three levels: federal, cantonal, and municipal. Federal tax is the same everywhere. Cantonal and municipal taxes vary enormously — between the cheapest and most expensive municipalities, the tax burden can differ by a factor of 2–3. Your goal: keep your taxable income and taxable wealth as low as legally possible.
Tier 1: The Big Levers (Savings: CHF 2,000–15,000+/year)
These are the deductions that truly make a difference. If you only optimise 3 things, make it these.
1. Pillar 3a: Max It Out — Always
With Pension Fund
CHF 7,258
Maximum 2025/2026
Without Pension Fund
CHF 36,288
Max 20% of net earned income
Tax savings: At a taxable income of CHF 100,000 in Zurich, a full 3a contribution saves around CHF 2,200 in taxes — every year. Over 30 years: CHF 66,000 in tax savings, plus the returns on the invested capital.
NEW from 2026: Retroactive 3a Buy-Ins
From 2026, you can for the first time fill contribution gaps in Pillar 3a — initially for 2025, later up to 10 years back. This means: in 2026, you can pay up to 2× CHF 7,258 = CHF 14,516 (current year + catch-up for 2025), provided there was a gap in 2025. Condition: the current year's maximum must be paid first.
2. Pension Fund Buy-In: The Strongest Lever for High Earners
Voluntary PK buy-ins are fully deductible from taxable income — with no cap (up to your personal buy-in potential). At high incomes with marginal tax rates of 35–40%, a CHF 30,000 PK buy-in delivers an immediate tax saving of CHF 10,000–12,000.
Timing strategy
Spread over several years. If you have CHF 100,000 buy-in potential, don't pay it all at once. Better: CHF 20,000–30,000 per year over 3–4 years → maximum tax bracket reduction. And: observe the 3-year lock-up before capital withdrawal! (→ PK Guide)
3. Location: The Biggest Lever Nobody Uses
Your residence determines your tax rate more than any deduction. Between the cheapest and most expensive municipality in the same canton, there's often a CHF 5,000–15,000 per year difference.
Example: CHF 120,000 taxable income, single
| Municipality | Tax burden approx. | vs. Zurich City |
|---|---|---|
| Zurich City | CHF ~21,500 | — |
| Winterthur | CHF ~21,000 | –CHF 500 |
| Baar (ZG) | CHF ~13,500 | –CHF 8,000 |
| Wollerau (SZ) | CHF ~11,000 | –CHF 10,500 |
Indicative figures. Use the federal tax calculator (estv.admin.ch) for exact numbers.
Of course, more matters than taxes when choosing where to live — but if you're planning a move anyway, know the tax implications.
Tier 2: Medium Levers (Savings: CHF 500–3,000/year)
4. Professional Expenses: Deduct More Than You Think
Most employees just take the flat-rate deduction. But actual costs are often higher:
Commuting costs: Public transport between home and office (GA, zone pass). By car: CHF 0.70/km, but many cantons cap at CHF 3,000–7,000. Check your canton.
Meals away from home: If you must eat at work. Flat rate: CHF 3,200/year (full-time, no canteen). Part-time = pro rata.
Other professional expenses: Flat rate 3% of net salary, max CHF 4,000 (federal). Actual often higher: professional literature, work clothing, home office (if no office provided by employer).
Home office: Many cantons now accept proportional rent costs for a home office, if no workplace is provided by the employer.
5. Further Education: Up to CHF 12,400 Deductible
Self-funded, job-related training is deductible — up to CHF 12,400 (Canton ZH) or CHF 13,000 (federal). This covers course fees, exam fees, textbooks, and travel to the course location. Not deductible: first-time qualifications (apprenticeship, university degree).
Example
CAS programme: CHF 8,000. At a marginal tax rate of 30% → tax saving: CHF 2,400. So the programme effectively "costs" you only CHF 5,600.
6. Child Deductions and Childcare Costs
Child deduction: Per child flat CHF 6,600 (federal) + cantonal amounts vary (ZH: CHF 9,000).
Childcare costs: Daycare, after-school care, nanny costs are deductible — up to CHF 25,000 per child/year (cantons) or CHF 25,800 (federal). That's enormous. If you spend CHF 20,000 on daycare per child, at a 30% marginal rate you save CHF 6,000 in taxes.
7. Dual-Income Deduction for Married Couples
Married dual earners can claim the dual-income deduction: federally, 50% of the lower income (min CHF 8,600, max CHF 14,100). Cantonal amounts vary widely — in some cantons only CHF 500, in others over CHF 10,000.
8. Insurance Premiums and Pension Contributions
Health insurance premiums, accident insurance, and life insurance premiums are deductible — but capped. Federal: CHF 1,800 (single) or CHF 3,600 (married). Most cantons have similar caps. This deduction is usually applied automatically.
Tier 3: Smaller Levers (CHF 100–500/year each)
Individually small. But together they can add up to another CHF 1,000–2,000.
Debt interest: Mortgage interest is deductible from income. Consumer loan interest too — though consumer loans are generally never worth it.
Donations: To tax-exempt organisations, up to 20% of net income. Minimum CHF 100/year.
Health costs: Deductible if they exceed 5% of net income (and aren't covered by insurance). Dental bills, glasses, therapy.
Wealth management costs: Account and custody fees. Flat rate: 0.3% of securities value, max CHF 6,000 (ZH).
Political party contributions: Up to CHF 10,300 (federal) or cantonal up to CHF 20,600 (married couples, ZH).
Early tax payment: Some cantons pay interest on advance payments (0.1–1%). Conversely: late payment interest is 4% (federal) — always pay on time!
Taxes and Investing: What You Need to Know
Capital Gains Are Tax-Free
In Switzerland, private capital gains are tax-free. If you sell a stock or ETF at a profit, you pay no tax on the gain. This is an enormous advantage compared to virtually every other country. This means: investing pays off even more in Switzerland from a tax perspective.
What IS taxable:
Dividends: Taxed as income. Accumulating (reinvesting) funds can be more tax-efficient than distributing ones.
Interest income: On savings accounts, bonds — all taxable income.
Wealth tax: Your total net wealth (accounts, portfolios, property minus debt) is taxed annually. Rates vary hugely by canton: minimal in Zug, noticeable in Geneva.
Withholding tax (Verrechnungssteuer): 35% on Swiss dividends and interest — refunded when correctly declared in your tax return. Don't forget to declare everything!
What Matters at Which Income Level?
Priorities by income bracket
CHF 60,000–80,000 gross
1️⃣ Max out 3a (savings: ~CHF 1,500–2,000)
2️⃣ Check actual vs. flat-rate professional expenses
3️⃣ Claim full childcare deduction (if applicable)
4️⃣ Check health insurance premium subsidy (many cantons eligible up to CHF 80k)
CHF 80,000–150,000 gross
1️⃣ Max out 3a + check 2025 catch-up payment (savings: ~CHF 2,000–4,500)
2️⃣ Check PK buy-in (biggest potential, spread over years)
3️⃣ Maximise further education deductions
4️⃣ Evaluate location optimisation
CHF 150,000+ gross
1️⃣ PK buy-in — by far the biggest lever (savings: CHF 5,000–15,000+/year)
2️⃣ 3a + catch-up fully maxed
3️⃣ Location optimisation (at CHF 200k+, a cantonal move can save CHF 10,000+/year)
4️⃣ Plan staggered capital withdrawal at retirement early (→ Pension vs Lump Sum Guide)
5️⃣ Wealth tax optimisation (don't amortise your mortgage too quickly)
Taxes at Withdrawal: The Other Side of the Coin
Money that saves taxes today (3a, PK buy-in) will be taxed upon withdrawal. But: the capital withdrawal tax rate is much lower than the income tax rate. That's why the strategy is still massively worthwhile.
Example: Pay CHF 7,258 into 3a vs. don't pay
| Save today | Pay later | Net benefit | |
|---|---|---|---|
| 3a contribution CHF 7,258 | –CHF 2,200 tax | +CHF 400–700 withdrawal tax | +CHF 1,500–1,800 |
Plus: the capital was invested for decades and generated returns — tax-free within the 3a.
Staggered withdrawal saves even more: Spread withdrawals (3a accounts, vested benefits, PK capital) across multiple tax years → break the progression → save thousands. (→ Pension vs Lump Sum Guide)
Watch out: Higher federal tax on capital withdrawals planned
The Federal Council's "Relief Package 2027" proposes higher federal taxes on capital withdrawals — possibly effective from 2027/2028. Positive for married couples: capital withdrawals may be taxed individually (no longer jointly) in future. (→ Pension vs Lump Sum Guide)
The 7 Most Expensive Tax Mistakes
1. Not Paying Into 3a
Every year without a 3a contribution costs you CHF 1,500–4,000 in lost tax savings. There's virtually no reason not to max it out.
2. Not Checking PK Buy-In Potential
Many people have CHF 50,000–200,000 in buy-in potential and don't know it. One look at your PK statement is all it takes. (→ PK Statement Guide)
3. Just Accepting Withholding Tax (B Permit)
If you earn over CHF 120,000 gross, you must apply for ordinary tax assessment (NOV). Below CHF 120,000, it's often still worth it — especially with 3a contributions and high professional expenses. Deadline: 31 March of the following year! (→ Newcomer Guide)
4. Having Only One 3a Account
At withdrawal, all 3a funds in the same tax year are combined → progression. With 3–5 accounts, you can withdraw in stages over several years and break the progression.
5. Not Coordinating PK Buy-In and Capital Withdrawal
If you buy into the PK and withdraw capital within 3 years, you must repay the tax savings. Timing is everything.
6. Forgetting the Withholding Tax Refund
35% on Swiss dividends and bank interest is automatically withheld. The refund only comes via your tax return — and only if everything is correctly declared. Forget an account or portfolio, and you lose the 35%.
7. Filing Late or Not at All
Late payment interest: 4% federal, up to 8% in some cantons. Request an extension online if needed — but never ignore it.
Your Tax Calendar: What to Do When
January: Set up 3a standing order (monthly beats December stress). Check last year's PK statement: buy-in potential?
March: NOV application deadline (31 March). File prior year's tax return or request extension.
June–September: Book and pay for training courses (still deductible in current tax year). Make PK buy-in (secure payment receipt for tax return).
November: Compare and switch health insurance (deadline: 30 November). Every franc saved on premiums is indirectly a tax saving too (more money to invest).
December: Check 3a: maximum reached? Catch-up payment for prior year made? Last chance: make a donation. Collect receipts for professional expenses, training, health costs.
Your Tax Checklist
☐ 3a: Maximum paid in (CHF 7,258)?
☐ 3a: Catch-up payment for 2025 checked and made?
☐ 3a: Multiple accounts opened (3–5 for staggered withdrawal)?
☐ PK buy-in: Potential checked on your statement?
☐ PK buy-in: Spread over multiple years (not all at once)?
☐ Professional expenses: Actual vs. flat-rate compared?
☐ Training costs: All receipts collected?
☐ Childcare costs: Fully deducted?
☐ Dual-income deduction: Claimed (married couples)?
☐ NOV: Application filed by 31 March (B permit holders)?
☐ Donations: Receipts for charitable organisations?
☐ Health costs: Uncovered expenses compiled?
☐ Withholding tax: All accounts and portfolios declared?
☐ Health insurance: Compared and switched by November?
☐ Location: Tax burden considered for your next move?
Invest Your 3a, Don't Park It. With arvy.
The 3a contribution is the most important tax deduction. But on a 3a savings account, your money loses purchasing power. With arvy, you invest your 3a in quality companies — benefiting from both tax savings and returns at the same time.
Disclaimer: This article is for general information purposes and does not constitute tax or financial advice. Deductions, maximum amounts, and regulations vary by canton and personal situation. For tax planning, we recommend the official federal tax calculator (estv.admin.ch) and professional tax advice where needed. arvy is a FINMA-regulated asset manager. As of February 2026.
