Retirement savings when moving abroad
To benefit from a long stay abroad or when completely breaking from the Swiss pension system, you should make the right arrangements early.
05 Dec 2017
Pillar 1: Avoid gaps…
7If you leave Switzerland for the foreseeable future and keep your Swiss residence, you are still insured by old age and survivors’ insurance (AHV). Your duty to make pillar 1 contributions remains. If you forget, you can pay the missing contributions within five years. In this way, you avoid reducing your retirement provision.
If you stay abroad permanently and move your domicile, AHV insurance is no longer mandatory and you do not have to make contributions. However, you will still receive a partial pension from the time of statutory retirement if you become disabled or in the event of death.
…and remain voluntarily insured
Given certain conditions, you can stay voluntarily insured by AHV in order to receive the full benefits from pillar 1 of the Swiss pension system even if you move away for good.
The requirement is
that you have Swiss citizenship or citizenship from an EU/EFTA country, will have your
domicile outside of the EU/EFTA zone in the future
and were insured for at least five years without interruption by AHV before moving away.
Pillar 2: Your new country of residence is the deciding factor
The obligation to contribute to pillar 2 ends when you end your employment relationship with your employer. If your pension fund regulations permit, you can still be insured by them for temporary stays abroad. But then you have to pay both employer and employee contributions.
Two scenarios are normally conceivable if you do not stay insured:
If you emigrate to a non-EU/EFTA country, you can withdraw your entire pension fund assets.
If you move to an EU/EFTA country and are subject to mandatory insurance there for old age, disability and death, your mandatory pension assets in the pension fund provisionally remain in a vested benefits account in Switzerland.
Important: If you withdraw pension fund assets after moving abroad, withholding tax becomes due. The withholding tax rate depends on the location of the vested benefit foundation.
To-do list for moving away from Switzerland
Give yourself enough preparation time for your stay abroad or your emigration.
Find out early about the necessary entry and residence permits, and contact the appropriate authorities.
Renew your passport and identity card if needed.
Collect all relevant documents like visas, work permits or reference letters, and have them translated and certified if necessary.
Find out about the pension system in the target country and talk to your compensation office about possibly keeping your Swiss pension solution.
Also speak with your pension fund about the possibility of staying insured or having your pension assets paid out.
Terminate all insurance and subscriptions in good time.