For many expatriates, purchasing property represents a significant step towards settling in Switzerland. However, owning real estate—whether in Switzerland or abroad—introduces unique elements to your Swiss tax return.
The Concept of "Eigenmietwert" (Imputed Rental Value)
If you own and live in a property in Switzerland, you must declare a theoretical income known as "Eigenmietwert," or imputed rental value. This is the estimated rental income you would receive if you were to lease your property on the open market.
Deductible Costs: The Other Side of the Coin
Fortunately, the addition of imputed rental income is offset by several significant deductions available to homeowners:
- Mortgage Interest: You can deduct the full amount of interest paid on your mortgage
- Maintenance Costs: You can deduct costs related to the upkeep of your property
Wealth Tax and Foreign Property
In addition to income tax, Switzerland levies a wealth tax on your worldwide assets. The tax value of your Swiss property is added to your total wealth.
