What happens to my pension fund if I become self-employed?

The step into self-employment is an exciting time full of new opportunities. At the same time, it raises important financial questions, especially about the future of your occupational pension. We want to provide clarity and show you the options available for your accumulated pension fund assets.

Your options at a glance

When you leave your employment to become self-employed, you must decide how your existing pension capital should be managed. You have three main options, each with different advantages and disadvantages.

Option 1: Withdraw the assets as start-up capital (cash payout)

You can withdraw your pension fund assets in cash and use them as start-up capital for your business.

When is this possible?

• You must register your self-employment with the Old-Age and Survivors' Insurance (OASI) compensation fund and no longer be subject to the mandatory occupational pension scheme (OPA), i.e., the pension fund for employees.
• If you are married or in a registered partnership, the written consent of your partner is required.

Here’s how to proceed:

1. Obtain OASI confirmation: Have your OASI compensation fund confirm the start of your self-employed activity.
2. Submit an application: Fill out the form “Application for cash payment / transfer”. You can also find it in the Tellco pk Download Center.
3. Submit documents: Send the application to us along with the OASI confirmation and, if applicable, your partner's consent.

Option 2: Park the assets safely (vested benefits account)

If you do not need the capital for your business, transferring it to a vested benefits account is the most common solution. Your assets are safely "parked" in a special account until you transfer them back into a pension fund or withdraw them for retirement.

Here’s how to proceed:

1. Open an account: Choose a vested benefits foundation and open an account with them.
2. Request the transfer: Provide us with the account details of your new vested benefits foundation so we can transfer your assets.

Note on withholding tax: If you withdraw the capital later (e.g., when moving abroad), a withholding tax will be due. The amount depends on the location of the vested benefits foundation. Foundations in the canton of Schwyz, like Tellco's, have one of the lowest tax rates in Switzerland, which is advantageous for you, regardless of your canton of residence.

Option 3: Voluntarily continue your pension plan

As a self-employed person, you are no longer mandatorily insured under pillar 2 (the occupational pension scheme). However, you can voluntarily join a pension fund to maintain your pension cover for old age, death, and disability and continue to accumulate capital.

Here’s how to proceed:

1. Check affiliation: Find out if you can continue to be affiliated with your previous pension fund or if you can join the pension institution of your professional association.
2. Request an offer: Contact the desired pension fund for an individual offer.
3. Transfer assets: Once the contract is signed, your existing assets will be transferred to the new pension solution.

Making the right decision

Which path is best for you depends on your personal and business situation. The following overview will help you decide:

We are here for you

Planning your pension as a self-employed person is an important step. Do you have questions or would you like to discuss your situation? We are happy to help you find the right solution for your financial future.

Contact us.