Thoughts on tax optimization 2021

Pension 3a

In November at the latest, you should check whether the annual contribution has already been made and whether it corresponds to the maximum. The annual contribution for self-employed persons and employees with a pension fund (PF) is limited to CHF 6,883. Employed persons without a PF can pay in up to 20% of their earned income annually, but no more than CHF 34,416.

Since a 3a bank account hardly yields any interest (currently 0% to 0.25%), it is worth linking the 3a account to an index/ETF if you are willing to take a certain risk. Example: An initial capital of CHF 100,000 amounts to CHF 150,000 after 20 years with an annual return of 2%. With an annual interest rate of 0.25%, the comparable final capital amounts to only CHF 105,000.

Purchase into the pension fund

Purchases into the PF are deductible in the private tax return and are one of the most effective tax saving options. The amount of the possible payment depends on the individual purchase potential.

Purchases should be spread over several years and are more worthwhile the higher the income and the sooner the capital is drawn. The highest after-tax return is achieved with a purchase in the last few years before retirement.

If at least a part of the PF money is drawn as capital at retirement, no more purchases may be made in the last 3 years before retirement.

Before making a purchase, however, you should inform yourself in detail about the financial situation of the pension fund (coverage ratio should be over 100%) and its benefits: What happens in the event of death with the amount paid in voluntarily ? In the event of disability, do I still have the choice between a lump sum and a pension? At what interest rate will the purchased capital earn interest?

Real estate

Maintenance preserves the value of real estate and reduces the tax burden. In each tax period, the taxpayer can choose between the deduction of the actual costs and the lump-sum deduction for each property. Small renovation works should ideally be concentrated in one year and larger renovation works should be spread over several years. Important: For private properties, the payment date is decisive, so it may be worthwhile to address these issues before the end of the year.

Not only maintenance work, but also energy-saving and environmental protection investments are tax deductible.

Donations and grants

Donations to political parties as well as to non-profit organizations or public institutions are also deductible with restrictions.

We will be happy to assist you as your tax advisor.

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Markus Jungo

Partner, Site Manager

Master of Science in Business Administration
Swiss Certified Accountant

T +41 26 347 28 88
mju@core-partner.ch

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