How can I make a withdrawal from my 2nd pillar?
You can withdraw your 2nd pillar under 4 specific circumstances:
You can withdraw your 2nd pillar under 4 specific circumstances:
- If you wish to become a homeowner and buy a house to be your main residence. In Switzerland, you have to invest a lot of money if you want to buy a house, which makes it difficult to afford for most people. So, it’s important to know that your 2nd pillar can help in such a case, as it can constitute an EPL/WEF withdrawal (withdrawal under the homeownership promotion scheme).
- If you want to become self-employed, seed money will be needed. Therefore the 2nd pillar can also be withdrawn for this purpose.
- If you want to leave Switzerland, of course we will let you leave with your assets. Though, everything will depend on your destination country. If it's outside the EU (or a country with agreements with Switzerland), you will only be able to take a supplementary insurance; if it's a country outside the EU, you can take everything with you!
- Let's not forget about retirement, since that's the reason why you pay contributions to the 2nd pillar... So be aware that you can withdraw your capital if you prefer to retire a little earlier, starting from the age of 58. (You should always check the regulations of your pension fund – as they may vary!)
In practice, every situation is unique. We therefore choose to study each case individually to provide the most suitable and, well, best possible solution.
The 2 advantages to the early withdrawal of the 2nd pillar pension
1. The tax saving potential of an early withdrawal
2. A chance to realize a dream project
1. The tax saving potential of an early withdrawal
Making a withdrawal of your 2nd pillar assets (almost) always implies that you will have to pay taxes. Tax equals potential tax optimization. Depending on the reason and your situation, that tax can vary greatly. Before requesting any withdrawal, we advise you to consider all available options and simulate the tax burden at the same time.
2. A chance to realize a dream project
These 2nd pillar withdrawal possibilities are a real opportunity to realize a life plan. If you wake up one morning and realize that your destiny is to settle on a Tanzanian beach, the inspiration to your dreams of many a night, then you can make a 2nd pillar withdrawal to make this dream come true. And if your dream doesn't take you to Tanzania, but rather to a jewelry workshop that’s just waiting for you to become self-employed, well, you can make that dream come true, too!
How can you withdraw your 2nd pillar pension? Follow these steps designed by FBKConseils
1. The first date!
The goal is to meet each other either in person or by videoconference to find out what your needs are and see how we can help you withdraw your 2nd pillar assets.
2. The creation of your file!
Once we have found a solution for your needs, we will move forward with the creation of your file – but we will need the right documents to do so.
3. The contacts!
With your file created, and the documents available, we can start approaching the various stakeholders in order to start the process.
4. The tax calculation!
Well, sorry to address the elephant in the room, but you won’t avoid paying taxes on your withdrawal regardless of its reason. However, according to the purpose of the withdrawal, these taxes can potentially be lowered!
5. Setting up the withdrawal!
Of course, after you and the other parties have validated the withdrawal, we will send the request for payment of the funds. Depending on the withdrawal reason, the procedure might take more or less time, but it's never an impossible task!
6. The final validation!
At this stage, we are only awaiting approval of the release of the funds.
7. Peace of mind!
All you have to do now is fulfill your dream and enjoy your recovered 2nd pillar.
How long does the procedure usually take and how much does it cost?
As it is also the case for the 3rd pillar, the 2nd pillar can only be withdrawn under certain specific conditions described in one of the previous paragraphs.
During the first appointment, free of charge, we will start by taking stock of your current situation in order to identify the best approach to requesting the early withdrawal of your 2nd pillar assets.
Depending on your situation, the reason given will be different and by extension so will the turnaround time. The latter can range from two weeks, in the simplest and most obvious cases, to two months for the most complex cases, mainly because of the waiting time for communications with the various institutions involved.
In all cases, we will provide you with a detailed offer and a tailor-made quote.
- When you retire, you can ask your pension fund to withdraw your 2nd pillar assets. You will have to choose whether you want to take it in the form of an annuity, a capital sum, or a mix of both (if your pension fund allows it).
- Yes, you can. You can withdraw your 2nd pillar before retirement under 4 specific conditions: if you are leaving Switzerland permanently, if you are purchasing a property, if you are becoming self-employed, or if you wish to take early retirement (always carefully read and try to comprehend the regulations of your pension fund).
- If your situation corresponds to one of the 4 possible ways of withdrawing your 2nd pillar pension before retiring, you will need to gather all the required documents to justify your withdrawal. You will then have to complete all the corresponding steps with your pension fund. It takes a lot of time to make a 2nd pillar pension withdrawal – so you should plan everything well in advance.
- Depending on what the withdrawal is for, the calculation of the tax on the 2nd pillar withdrawal will differ. In most cases, it will be calculated as an income tax (communal, cantonal, and federal) but instead of the income, the amount of the withdrawal will be taken. The applied scales are identical to those used for the calculation of the income tax but are divided by 5, which makes the tax on the withdrawal of the 2nd pillar more generous than for the other incomes.
