Hello from a long time “lurker”
I have been thinking about this for some time: Like every year I am currently faced with the decision to pay into some form of 3rd pillar investment.
Now just looking at the tax rate, I am under the impression that it is actually a risky undertaking
This year we will be paying a state and local tax rate of ~ 7.5% (Zug) and an additional 4% Bundessteuer. Lets say the best case scenario is, we retire in Zug which would amount to a tax rate of 3-6% (depending on the total amount withdrawn). Not a great return from the tax rate alone but it is something.
But am I right that if we were to retire anywhere else, we could actually pay more in withdrawal than in income taxes? Especially if we were to move abroad and then we would have to declare it as income there?
Let me know what you guys think - what’s the point of 3a in Zug?