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LPP buy-in — when the 2nd pillar beats Pillar 3a

Voluntary contributions to your pension fund can save more tax than 3a — but only under specific conditions. Mechanics, optimal sequencing, the Art. 79b lock-in.

What an "LPP buy-in" actually is

Your employer pension fund (Pensionskasse / caisse de prévoyance, BVG/LPP) has a target benefit at age 65: roughly 60–65 % of your final salary. The fund books how much capital is needed to hit that target and how much you've accumulated so far. The gap between "needed" and "accumulated" is your Einkaufspotenzial (buy-in capacity). You can voluntarily pay that gap in — partially or fully — and it's fully deductible from taxable income in the year you pay.

A typical employee in their 40s has a buy-in capacity of CHF 30 000 to CHF 250 000 — sometimes more if there was a career break, parental leave, or a job change with a small bridging fund.

The math: why it can beat 3a

3a is capped at CHF 7 258 in 2026. LPP buy-in has no statutory cap; it's capped only by your own buy-in capacity. So at high marginal rates with a big buy-in capacity, you can move way more taxable income off the table.

Worked example: a single in Bern, CHF 200 000 gross income, 36 % marginal rate, CHF 50 000 buy-in capacity.

The three-year lock-in (Art. 79b)

The catch: under BVG Art. 79b paragraph 3, any pension capital that comes from a voluntary buy-in cannot be withdrawn as a lump-sum for three years. If you draw it earlier (e.g. as a partial lump-sum at retirement, or for buying a home), the tax authority recaptures the deduction.

Practical implication: do not buy in three years before retirement unless you're certain you'll take the pension as a life-long annuity (Rente) and not as a lump-sum. Optiqo's lever engine flags this automatically.

Multi-year sequencing — the DP trick

If your buy-in capacity is, say, CHF 100 000 and you can afford ~CHF 30 000/year of extra contributions, you have a choice: pay it all in one big tax year vs spread it across three.

Counter-intuitively, the answer is usually spread. Why? Because tax is progressive. A CHF 100 000 deduction in one year moves you down through several marginal-rate bands; only the bottom slice of those bands matters for your average rate. Spreading the same CHF 100 000 over 3–5 years keeps you in the top marginal-rate band the whole time, maximising the saving.

Optiqo's multi-year LPP solver finds the optimal year-by-year allocation that maximises total tax saved, subject to your annual cashflow constraint and the Art. 79b window.

Opportunity cost: LPP vs an SMI ETF

The case for not buying in: that money could be invested in a global equity ETF earning ~6 % a year, taxed lightly at the dividend level, and stays liquid. The case for buying in: the immediate tax saving is bigger than the first few years' opportunity cost, and pension capital is wealth-tax-exempt (the ETF balance isn't).

The right answer depends on (a) your years to retirement, (b) your marginal rate today vs at retirement, (c) the lump-sum tax in your canton, (d) the ETF return you actually believe in. Optiqo's plan computes both paths and shows the break-even point in years.

Two traps

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