The employer contribution reserve and your options

The employer contribution reserve ("AGBR") is a voluntary advance payment by the employer to the pension fund to cover future employer obligations. The formation of an AGBR allows a company to control its income statement and thus optimize its tax situation. In the current negative interest rate environment and under COVID-19, the possible applications have been further expanded.

Tax optimization

Employers can set up a contribution reserve within their pension plan for future years. Payments made as AGBR are recognized by the employer as a tax-privileged expense. The AGBR may not exceed five times the amount of the annual employer contribution owed in accordance with the pension fund regulations. If the employer has affiliated its employees with several insurance companies, the permissible contributions to the reserve must be determined separately for each insurance company.

The payments to the AGBR represent out-of-period contributions to the pension funds. For tax purposes, these can be claimed in full as a business-related expense, which reduces the taxable profit as well as the taxable capital.

This is always subject to the condition that the payments have actually been made to the pension fund. Furthermore, care must be taken to ensure that the AGBR is reported separately by the pension fund. Practical experience shows that such payments have already been booked to the normal contribution account at the pension fund and then not recognized for tax purposes. In any case, it is advisable to request a corresponding account statement from the pension fund if this has not already been sent automatically.

The AGBR is earmarked and cannot be reclaimed directly. However, the employer can instruct the pension fund as required to debit the future employer contributions to this AGBR in each case and must therefore only pay the contributions deducted from the employees to the pension fund.

The payment can be made during the current year or retrospectively, when the annual financial statements are prepared. Payments are generally recognized by the tax authorities by June 30 of the following year. In the canton of Berne, the payment must have been made by the time the tax return is filed. The transfer must be documented in the tax return in a suitable form (e.g. account statement of the pension fund).

Possible recognition of the employer contribution reserve in the financial statements

Die AGBR stellen stille Reserven dar und sind bei der Berechnung der Veränderung der stillen Reserven mit einzubeziehen. Eine wesentliche Nettoauflösung von stillen Reserven ist im Anhang betragsmässig entsprechend offen zu legen.

Liquidity management

However, a payment into the AGBR only makes sense if the company also has the necessary liquidity, as liquid funds flow out with the formation of the AGBR. When the AGBR is "recovered", the company's liquidity is then protected accordingly.

In the current negative interest rate environment, the formation of an AGBR represents an opportunity for liquidity management. The AGBR accounts are not subject to negative interest rates; depending on the structure of the pension solution, even a small interest rate is provided for.

The AGBR and COVID-19

In order to cushion the economic consequences for employers of the measures taken in connection with the fight against COVID-19, employers may, as in the previous year, use the AGBR they have accumulated for the payment of employee contributions to occupational pension plans in 2021. This measure is intended to make it easier for employers to bridge liquidity bottlenecks.


The formation and dissolution of an AGBR is very simple and unbureaucratic. It is advisable to ask the pension fund for the maximum amount of employer contributions to be paid in. Although the AGBR is earmarked for a specific purpose, it is a powerful instrument that companies can use for their own tax planning or for liquidity management.

This article previously appeared in CORE Newsletter 30, December 2021.

Peter Schütz

Peter Schütz

Head of Team Alternate
Expert-Accountant Graduate

T +41 31 329 20 26