The Eigenmietwert (imputed rental value — the notional rental income on which Swiss owner-occupiers are taxed) is being abolished. For owner-occupied residential property much changes, for rented properties almost nothing — except for one deduction. Anyone who holds a home and an investment property at the same time has to do the sums again.
What has been decided at federal level
The starting point is enacted law: on 28 September 2025, the reform of the taxation of residential property was approved with 57.7 % yes against 42.3 % no, with a voter turnout of 49.5 %.
On 1 April 2026, the Federal Council set the entry into force of the system change for 1 January 2029.
This article is therefore a preview of a rule that is already fixed: the law is in place, and the official method of calculation has been available since the fact sheet of the Federal Department of Finance dated 15 August 2025. What remains open is the interpretation in detail — a working group of the Federal Tax Administration and the cantonal tax administrations is drawing up the implementing provisions, which will then go into consultation (Vernehmlassung — the formal consultation procedure); no consultation has been published so far.
This means: up to and including tax year 2028, the current system continues to apply. The system change takes effect from 2029.
Three types of property, three answers
Whether you are affected at all depends on how you use the property. Which deduction remains for which type of use is shown in the table further down; here is what the table cannot capture:
- Owner-occupied residential property. The abolition of the Eigenmietwert and the abolition of the deductions apply equally to primary and secondary properties.
- Rented properties. You continue to pay tax on the rental income. What changes is the debt interest deduction (Schuldzinsabzug) — and this is where the real question lies for owners with a mixed portfolio.
- Owner-used secondary properties. In addition to the first point: the new constitutional provision allows the cantons to levy a special property tax on predominantly owner-used secondary properties — this allows in particular the more heavily affected tourism cantons to compensate for lost revenue.
The debt interest twist
From 2029, debt interest (Schuldzinsen) will only be deductible proportionally. The proportion is a ratio: the numerator contains the rented and leased properties, the denominator the total of all movable and immovable assets. In technical terms this is called the quotal-restriktive Methode (proportional-restrictive method).
The closer the numerator comes to the denominator, the higher the deductible share. Anyone without taxable rental or lease income can no longer deduct any debt interest at all. Movable assets — a bank account, for example — never count in the numerator, but they do count in the denominator.
This is what it looks like in figures. The fact sheet works through a mixed portfolio: own home CHF 800’000.—, owner-used holiday apartment CHF 300’000.—, rented apartment CHF 800’000.—, bank account CHF 200’000.—. With debts of CHF 500’000.— at 2 %, debt interest of CHF 10’000.— is incurred. The ratio is CHF 800’000.— to CHF 2’100’000.—, i.e. 38.1 % — CHF 3’810.— is deductible. The graphic shows the path step by step.
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The interest at stake
Debts of CHF 500'000.— at 2 percent result in CHF 10'000.— of debt interest per year.
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The numerator: only what is rented out
Only the rented apartment at CHF 800'000.— goes into the numerator. Own home, holiday apartment and bank account do not count here.
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The denominator: everything together
The denominator contains all assets, CHF 2'100'000.— in total.
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The ratio
CHF 800'000.— of CHF 2'100'000.— is 38.1 percent. Which property the debts are secured on makes no difference.
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What remains deductible
38.1 percent of CHF 10'000.— is CHF 3'810.—.
Official federal calculation example (EFD/ESTV, 15.08.2025) — not advice for an individual property.
The fact sheet expressly states: «For the calculation of the deductible ratio, it makes no difference which of the three properties the debts are secured on.»
The same debt and the same interest rate at the two extremes: someone who holds only a home of CHF 800’000.— and a bank account of CHF 200’000.— arrives at a numerator of zero and deducts nothing. Someone who instead holds only a rented property of CHF 800’000.— and the same bank account arrives at a ratio of 80 % and deducts CHF 8’000.—.
One exception remains: persons who acquire residential property in Switzerland for the first time and use it as their primary residence can claim an Ersterwerberabzug (first-time buyer deduction) for ten years — initially at most CHF 10’000.— for married couples and CHF 5’000.— for all other taxpayers. The maximum amount decreases by 10 % each year, i.e. to CHF 9’000.— in the second year and CHF 8’000.— in the third; after ten years it ceases.
Why this calculation remains an example: the fact sheet gives amounts but no rule as to which value the properties are to be entered at in the numerator and denominator. Precisely such questions of interpretation are only settled in the implementing provisions.
Why the timing of a renovation becomes a tax question
Imputed rental value, maintenance deduction and interest deduction stay as they are — up to and including tax year 2028.
Deductions for maintenance and for energy-saving and environmental measures on owner-occupied property are only available until then under federal direct tax.
No more imputed rental value on owner-occupied property. Interest is deductible only pro rata — according to the quota.
On an owner-occupied property, deductions for maintenance and for energy-saving and environmental protection measures can only be used for direct federal tax until the end of 2028. Anyone planning a major renovation therefore decides not in 2029 but today: work completed by the end of 2028 still falls under the old deduction rules.
This is not a recommendation to renovate now — it is a pointer to choose the timing deliberately rather than leaving it to chance.
Which of your properties are affected?
| Use | Eigenmietwert | Maintenance deduction | Debt interest deduction |
|---|---|---|---|
| Owner-occupied (primary/secondary property) | abolished | abolished | generally no longer |
| Rented / leased | — (rental income remains) | remains | only proportionally (value ratio) |
| Secondary property, owner-used | abolished | abolished | generally no longer; canton may levy a special property tax |
Where we draw the line
All figures, deadlines and legal references in this article are disclosed and linked on our sources page — including the method of calculation, the official calculation examples and the status of implementation.
This article puts the legal situation into context and does not replace tax advice: for the calculation on your specific property, consult your tax adviser — we keep the figures ready for that.
What we do for you: we manage your rental properties for a fixed price of CHF 69.— per month per residential unit (excl. VAT) and keep the records so that the relevant figures are at hand when you need them — what that includes is set out under Renting out. Management without surprises — Request a quote. 💙
All figures and legal references in this article are disclosed and linked → Sources.
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