Pillar 3a is an important component of retirement planning in Switzerland for U.S. Persons as well. But U.S. citizens or dual U.S. citizens residing in Switzerland often have a hard time setting up a Pillar 3a with securities. Discover what a US person is, why many Swiss banks don’t want US persons as clients and with which providers you can take out a pillar 3a as a US person.
What is a US person?
A U.S. person is an individual who is either a U.S. citizen, a resident of the U.S., a person that holds a permanent residency and work authorization (such as a U.S. green card), or has spent more than 31 days in the U.S. within a year and has spent a total of more than 183 days in the U.S. in the past three years. Legal entities that are incorporated under U.S. law or have their registered office in the U.S. are also considered U.S. persons. The same applies to individuals who may be subject to U.S. tax for other reasons, such as owning a second home, filing a joint tax return with a U.S. person, or having renounced U.S. citizenship or long-term U.S. residency.
Why do many Swiss banks not want US persons as clients?
The U.S. is about the only country in the world that taxes its citizens based on citizenship alone. Therefore, it does not matter to the U.S. tax administration where its citizens live. You have to file a tax declaration every year.
And that’s where FATCA (Foreign Account Tax Compliance Act) comes into play for U.S. persons with its special tax reporting requirements. FATCA is a U.S. law and is intended to combat tax evasion by U.S. persons for foreign accounts. The FATCA reporting requirements also apply to Swiss banks that have US persons as clients.
Because of the high costs and administrative burden associated with complying with FATCA requirements, many Swiss banks do not want U.S. persons as clients. Because then, for example, they have to automatically transmit information about their American customers to the US tax authority IRS. US persons therefore often have problems opening a bank account in Switzerland, getting a mortgage or even a pillar 3a.
Who offers a pillar 3a for US persons?
Although most Swiss banks do not want US persons as clients, some providers do allow US persons to invest in Pillar 3a solutions with securities.
The following providers do not accept US persons as clients in pillar 3a:
Smolio conducted a web search of larger providers for digital pillar 3a solutions in October 2023. The following providers explicitly exclude U.S. persons:
- Frankly
- Selma
- Truewealth
- Viac
- Vontobel Volt
- Yapeal
- Yuh
Do I have to close my 3a custody account when I emigrate?
That depends on the provider of your pillar 3a solution. Some only accept clients residing in Switzerland, others also accept clients residing abroad. The details are best clarified directly with your provider.
What happens to a Pillar 3a for US persons when they leave Switzerland?
When you leave Switzerland for good, you can withdraw your Pillar 3a assets without any restrictions. A capital gains tax is then incurred. Or you may optionally leave it and have “an account in Switzerland” (if your current provider allows this for customers residing abroad). Depending on which country you move to, there are different tax consequences. You can find out more in this article.
Summary: Pillar 3a for US Persons
US persons are subject to US taxation worldwide. The U.S. law FATCA is intended to combat tax evasion by U.S. persons abroad. The associated expenses and reporting requirements mean that many Swiss financial services providers and banks do not offer Pillar 3a solutions for US persons. As a US person, you can (as of November 2023) conclude solutions with securities at finpension and Inyova 3a.
Hinweis
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Open Inyova Pillar 3a
Enter promo code SMOLIO in your Inyova dashboard under “Promotions” when you open your Pillar 3a or Inyova Invest account and before you deposit money. Thanks to the Inyova Friends Code you will not pay any fees for 12 months.
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Wir haben für den Inhalt dieses Artikels grosse Sorgfalt angewendet. Fehler können wir trotzdem nicht ausschliessen und können keine Gewähr für Korrektheit und Vollständigkeit bieten. Der Artikel ersetzt keine steuerliche Beratung. Wir bieten keine Steuerberatung an und empfehlen Steuerfragen in jedem Fall mit einem Steuerexperten und/oder der zuständigen kantonalen Steuerverwaltung abzuklären werden. Jegliche Haftung wird abgelehnt.
Disclaimer
Wir haben für den Inhalt dieses Artikels grosse Sorgfalt angewendet. Fehler können wir trotzdem nicht ausschliessen und können keine Gewähr für Korrektheit und Vollständigkeit bieten. Der Artikel ersetzt keine steuerliche Beratung. Wir bieten keine Steuerberatung an und empfehlen Steuerfragen in jedem Fall mit einem Steuerexperten und/oder der zuständigen kantonalen Steuerverwaltung abzuklären werden. Jegliche Haftung wird abgelehnt.
Disclaimer
Wir haben für den Inhalt dieses Artikels grosse Sorgfalt angewendet. Fehler können wir trotzdem nicht ausschliessen und können keine Gewähr für Korrektheit und Vollständigkeit bieten. Der Artikel ersetzt keine steuerliche Beratung. Wir bieten keine Steuerberatung an und empfehlen Steuerfragen in jedem Fall mit einem Steuerexperten und/oder der zuständigen kantonalen Steuerverwaltung abzuklären werden. Jegliche Haftung wird abgelehnt.
Last update: 29.10.2023 15:49
