«A system change is not a single date – it is a process.» The abolition of the imputed rental value (Eigenmietwert) represents one of the most significant tax policy reforms of the past decades. For owners of owner-occupied residential property, it marks the end of a long-established, yet often criticised, taxation model. What initially appears to be a simplification and tax relief reveals, upon closer examination, a complex structural shift with clear winners – and losers.
With the abolition of the imputed rental value, key deductions will disappear simultaneously. In particular, properties with high mortgage debt or significant renovation requirements may face considerable tax implications, as such properties will lose part of their tax attractiveness and existing financing and investment assumptions will need to be reassessed. The decisive factor is therefore not whether one is affected by the reform, but how well one prepares for it. The remaining time window until the end of 2027 is crucial. The reform is expected to enter into force no earlier than 2028; the final decision currently lies with the Federal Council.
Abolition of the Imputed Rental Value – Loss of Maintenance Deductions
With the abolition of the imputed rental value, owner-occupied property will no longer be taxed as income. At the same time, various deductions for owner-occupied properties, including second homes, will no longer be permitted, in particular:
- Maintenance and repair costs
- Property management costs paid to third parties and insurance premiums
- Energy-efficient renovation and environmental measures (at least at the level of direct federal tax)
For rented or leased properties, maintenance costs will generally remain deductible. The reform therefore primarily affects owner-occupied real estate.
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