The Swiss pension system rests on three pillars: the state AHV/IV (pillar 1), occupational provision/pension fund (pillar 2), and private provision (pillar 3). Pillar 3a is the "restricted" part of the third pillar, restricted because the money generally stays put until shortly before retirement and may only be withdrawn early in legally defined cases.
How it works: you open a 3a account at a bank or a 3a policy at an insurer and pay in each year. The amount paid in may be fully deducted from taxable income, which is the central tax benefit. Employed people with a pension fund may pay up to an annual maximum (guide figure around CHF 7,258, adjusted annually, no guarantee). Self-employed people without a pension fund may pay up to 20 % of net earned income, capped at a higher maximum (guide figure around CHF 36,288, no guarantee).
For whom and when: worthwhile for anyone with AHV-liable earned income who wants to save tax and additionally provide for old age. The balance can be drawn at the earliest five years before reaching the AHV reference age, and also early for buying owner-occupied residential property, starting self-employment, or leaving Switzerland permanently. On withdrawal, a reduced capital-payout tax applies, assessed separately from other income.
What to watch for: bank 3a (account or securities solution) is flexible and without insurance ties; insurance 3a couples saving with death/disability cover but is less flexible and an early exit is often tied to losses. A common tax tip is staggering: keeping several 3a accounts and withdrawing them in different years to break the progression of the capital-payout tax.
A financial or pension advisor helps determine the right solution (account vs. securities vs. policy), the correct contribution strategy, and the later withdrawal plan. The tax saving depends on income and municipality; for middle incomes the maximum contribution realistically saves several hundred to over a thousand francs in tax per year (no guarantee).