Swiss Pension Refunds for Returning Aussies – What about Pillar 1?
Swiss Pillar 1 pension refund for Australians
We recently covered the process for accessing your Pillar 2 and 3a for Aussies leaving Switzerland and returning to our sea-girt land (read article). A diligent reader asked, “That’s great, but what about Pillar 1 – do I have any entitlements here?”.
Pillar 1 is the amount paid to fund the minimum old-age pension as well as life and illness insurance. In most cases, there is never a refund if you are a Swiss or EU national. But in a rare case of Aussie exceptionalism, Australia is only of only 8 countries that can claim a refund of Pillar 1 employee and employer contributions!
How? Well, as you would expect, there is a separate and completely different process that is required compared to Pillars 2 & 3. Let’s break down how it works, what you’ll get, and how to navigate taxes on both sides.
Eligibility: Who Qualifies?
Australia’s social security agreement with Switzerland allows you to claim a refund of your AHV contributions if:
- You’ve contributed for at least one full year
- You’re permanently leaving Switzerland (or have firm plans to do so)
- Your spouse/children under 25 are also leaving (exceptions apply for adult children completing education)
This refund option isn’t available to Swiss/EU nationals, making it a valuable perk for Aussie expats.
The Refund Process: Step by Step
- Wait Until After Departure
Submit your application after leaving Switzerland. The Swiss Compensation Office (SAK) won’t process requests from residents. - Gather Documents
You’ll need:-
- Completed SAK refund form (download from admin.ch)
- Swiss departure certificate (Abmeldebescheinigung)
- Passport copies for you/family members
- Proof of Australian residency.
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- Mail to Geneva
Send everything to:
Schweizerische Ausgleichskasse, Postfach 3100, 1211 Geneva 2, Switzerland
Processing takes ~3 months. Pro tip: Use registered post: Swiss bureaucracy loves paperwork!
How Much Will You Get?
Your refund equals 8.7% of your Swiss gross income during contribution years. This includes both your share (4.35%) and your employer’s (4.35%).
But wait – Switzerland takes a cut first:
A 35% withholding tax applies to refunds (Tarifcode D).
Example: For CHF 50,000 in contributions:
Gross refund: CHF 4,350
Swiss tax: CHF 1,522
Net received: CHF 2,827
Australian Tax: Timing Is Everything
The ATO treats your refund as a foreign super lump sum. The tax hit depends on when you transfer it:
- Tax-free option: Transfer within 6 months of becoming an Aussie resident. The entire amount is non-assessable.
- Partial tax: Transfer after 6 months? Only the earnings accrued during Aussie residency are taxed.
Key Considerations for a Refund of Swiss Pension
- Pension vs. Refund
If you don’t claim the refund, you’ll receive a Swiss AHV pension at retirement (currently CHF 1,225/month max). For many younger expats, the refund’s upfront cash outweighs future payments. - Voluntary AHV Contributions
Returning to Australia? You can’t keep paying into AHV – the refund is a one-time exit option. - Super Transfer Strategy
Work with your Atlas Wealth adviser to:- Maximise Swiss tax recovery
- Time transfers to minimise Aussie tax
- Coordinate with other pensions (e.g., Pillar 2/3)
The Bottom Line: Swiss Pillar 1 Pension Refund for Australians
Claiming your AHV refund can inject meaningful cash into your Aussie homecoming fund. While the 35% Swiss tax stings, strategic timing with the ATO’s 6-month rule could make the entire amount tax-free in Australia.
Your action plan:
- Submit your SAK application ASAP after leaving
- Consult a tax pro familiar with both systems
- Consider transferring funds within 6 months of residency
Switzerland’s pension system is notoriously complex, but for Aussies, this refund is a rare streamlined process. Get organised, claim what’s yours, and put those francs to work Down Under.
Contact Us
If you’re considering a move from Switzerland to Australia and want to ensure your pension strategy is as tax-efficient as possible, contact us today for a confidential consultation. Our team specialises in cross-border financial planning and can provide tailored guidance based on your unique circumstances.
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