Abolition of the deemed rental income

On 28 September 2025, the vote to abolish the deemed rental income was approved. The change is expected to come into force in the tax period 2028.

The resulting consequences are explained below. As this may still change, these are provisional and may not be final:

• First-time property owners can continue to deduct debts and debit interest for the property for a total of 10 years. Those who do not meet the exception and have owned their property for longer can only deduct debts and debit interest in proportion to the value of a rented property. For everyone else, the deductibility of debts and debit interest no longer applies.

• Renovations and refurbishments are no longer tax-deductible for properties available for your own use. For rented properties, real estate maintenance costs are expected to remain deductible. Investments in environmental and energy-saving measures could be an exception. The cantons will make a decision on this. However, these deductions will no longer be possible on the federal tax level.

• The cantons (especially those with a high level of tourism) could introduce a property tax. It is not yet known in which cantons this will be introduced, whether it will be introduced at all, or how high it will be.

Owners living in their own properties, which were previously subject to tax on both their tax value as well as their deemed rental income, may wish to consider the extent to which renovations and investments can still be carried out up to and including the tax year 2027 in order to claim the associated costs in the relevant tax returns.