Retirement provision for company owners

Young entrepreneurs have everything on their minds except retiring. Nevertheless, as the owner of a sole proprietorship or a partnership, it is important to take care of retirement provision early on.

Options regarding retirement provision depend on the legal form

In the case of legal entities, as a managing director, you are also automatically an employee of the company and thus insured against age, disability, and death by the Federal Law on Occupational Retirement, Survivors' and Disability Insurance (BVG). As a sole trader or owner of a partnership, however, you are not required to subject yourself to occupational pension provision.

Sole proprietorships and partnerships with employees

As a sole trader or owner of a partnership with employees, you have the option to secure yourself via the 2nd or the 3rd pillar. In the 2nd pillar, you can join the same pension institution as the employees. Additionally, it is possible to insure yourself through the respective industry association or with the BVG contingency fund foundation. In the 3rd pillar, up to 20% of the annual earned income, but no more than CHF 33,840.-, can be paid in if you opt out of occupational pension provision (2nd pillar). With a pension fund, the annual maximum amount is reduced to CHF 6,768.-. Further details on pillar 3a can be found in our article Private Provision in Switzerland - the 3rd Pillar.

Sole proprietorships and partnerships without employees

As a sole trader or owner of a partnership without employees, in the context of the 2nd pillar, the only options are to insure yourself through the respective industry association or with the BVG contingency fund foundation. Provision through the 3rd pillar is possible to the same extent as for sole proprietorships and partnerships with employees. For self-employed individuals, saving in the 3rd pillar is the most important form of occupational pension provision.