Abolition of the imputed rental value is a fact

On September 28, 2025, the electorate approved an amendment to the Federal Constitution, specifically the introduction of the additional Art. 127 para. ^2bis of the Federal Constitution of the Swiss Confederation. As a result of a link to the constitutional amendment, imputed rental value taxation will be abolished. We explain in a factual and understandable way which aspects will change as a result of the adoption.

What will change

Imputed rental value

Income taxation of imputed rental value will no longer apply to all owner-occupied properties, both primary and secondary properties.

Interest on debt

All private debt interest (e.g. mortgage interest, loan interest) is no longer deductible from taxable income. However, there is an exception if a property located in Switzerland is rented or leased out. In this case, the debt interest can be deducted on a pro rata basis in proportion to the value of this property to the total assets (proportionate-restrictive method).

Another exception applies to taxpayers who acquire a permanently and exclusively owner-occupied property for the first time. In the first tax year after the purchase, the private debt interest attributable to this property can be deducted up to a maximum of CHF 10,000 (for married couples) or CHF 5,000 (for single persons). In the following ten tax years, the maximum deductible amount is reduced linearly by one tenth per year.

There is a transitional provision for taxpayers who acquired an owner-occupied property for the first time no more than ten years before the effective date. The above paragraph applies by analogy for the remaining tax years.

Maintenance costs

The actual and lump-sum maintenance costs for privately owned properties are no longer deductible. There is a possible exception at cantonal level for investments in energy-saving and environmental protection measures. While subsequent deductions will no longer be permitted at direct federal tax level once they come into force, the cantons are free to decide in their respective legislation (optional provision) whether these expenses remain deductible or not.

• Energy-saving and environmental protection measures
• Dismantling costs with regard to a new replacement building
• Deduction carried forward to the two subsequent tax periods

The deductibility of the costs of conservation work remains (direct federal tax) or depends on cantonal law (cantonal and municipal taxes).

In the case of rented or leased properties, maintenance costs are still deductible.

Special property tax

The adoption of the referendum allows the cantons to introduce a special property tax. Such a property tax only applies to secondary properties that are predominantly owner-occupied. Secondary properties that are predominantly rented out are not affected. Furthermore, owner-occupied residential property (main residence) is also not affected by such a property tax. Whether and how the cantons will implement the special property tax remains to be seen.

Entry into force

The date of entry into force has not yet been determined. The Federal Council has yet to decide on this. According to the Federal Council's media conference on September 28, 2025, the abolition of the imputed rental value is likely to come into force on January 1, 2028 at the earliest.

We are keeping a close eye on further developments in the cantons, in particular the canton of Lucerne, and are happy to offer our advice.