Imputed rental value and maintenance deductions: the tax return for homeowners
Anyone living in their own house pays tax on a rent they never receive – the imputed rental value. In return, they may deduct mortgage interest and maintenance. Those who know the rules save several hundred to thousands of francs every year.
In brief
- Imputed rental value = notional income for living in your own house, set by the canton
- Deductible: mortgage interest, value-preserving maintenance, insurance, administration costs
- Maintenance: choice renewable every year – flat rate or actual costs
- Energy-saving measures: deductible, in many cases carried forward to the two following years
- The abolition of the imputed rental value has been decided at federal level – the date of implementation is still pending
The imputed rental value
The imputed rental value corresponds to roughly 60–70 % of the market rent and is set by the canton of Basel-Landschaft on the basis of the tax value. It is counted as taxable income. Anyone significantly under-using their house (e.g. alone in a 7-room house after the children have moved out) can in certain cases apply for a reduction.
What you may deduct
- Mortgage interest (debt interest) – up to the amount of investment income plus CHF 50,000
- Value-preserving maintenance: repairs, replacement in the same quality, painting, servicing
- Insurance premiums for the building (building insurance, building liability)
- Administration costs by third parties (e.g. for condominiums the share of the management)
- Contributions to the renovation fund for condominiums
- Energy-saving and environmental protection measures – even if they add value
Flat-rate or actual – anew every year
You may choose anew in each tax period: the flat-rate deduction (in the canton of Basel-Landschaft a percentage of the imputed rental value, depending on the age of the building) or the actual costs with receipts. The rule of thumb: actual in years with major work, flat-rate in quiet years. Anyone spreading renovations over several years can break the progression and deduct actual costs several times.
Value-preserving or value-adding
| Measure | Income tax | Property gains tax |
|---|---|---|
| Replace kitchen, same standard | value-preserving – deductible | – |
| Replace kitchen, significantly higher standard | partly value-adding | Added value counts for the property gains tax |
| Paint façade, repair roof | value-preserving – deductible | – |
| Extension, attic conversion, additional bathroom | value-adding – not deductible | reduces the property gains tax later |
| Replace oil heating with heat pump | energy-saving measure – deductible | despite adding value |
| Photovoltaics, insulation, new windows | energy-saving measure – deductible | carried forward to 2 following years |
Energy-saving measures
Investments in energy saving and environmental protection are deductible even though they increase the value. If they exceed taxable income, they can be carried forward to the two following tax periods. This also applies to demolition costs for a replacement new build. In view of the rules on replacing fossil-fuel heating in Basel-Landschaft (from 2026), this is relevant for many owners.
Abolition of the imputed rental value
The Federal Parliament has decided to abolish the imputed rental value for owner-occupied residential property; the bill was accepted in the popular vote. With the imputed rental value, however, the deductions for maintenance and largely for debt interest also disappear. The date of implementation in the cantons is still pending. Until then the current system applies – and it pays to plan upcoming renovations while they are still deductible. We will inform our clients as soon as the date is set.
Practical tips
- Keep all invoices – even in flat-rate years (for the property gains tax)
- Split major work across the turn of the year: two tax periods, actual costs twice
- The invoice date counts (or the payment date – in BL the invoice date usually applies)
- If in doubt: Roman Frey, our property fiduciary, prepares the tax return – on a time basis, quote in advance
Questions on this topic.
Can I have the imputed rental value reduced?
In the case of significant under-use an application can be made.
- Prerequisite: permanent under-use, e.g. a single person in a large house after the children have moved out
- Practice is restrictive – we examine the individual case
What is deductible if I let the house?
The same maintenance and administration costs – instead of the imputed rental value you pay tax on the rent.
- Additionally deductible: management fees, advertising costs when tenants change
What does the tax return cost at ImmoBilà?
On a time basis, with a written quote in advance.
- A simple return with a home costs less than one with let properties
- Preferential conditions for clients with a sales or letting mandate
Tax return with property?
Roman Frey, our property fiduciary, gets out everything that is permissible – quote in advance.
Let’s talk about your property.
Call or write to us – reply within 24 hours.
ImmoBilà GmbH · Schneckelerstrasse 1, 4414 Füllinsdorf
info@immobila.swiss · Mon–Fri 8:00–12:00, 13:30–17:30