Favour or opt for rental

Some people think that becoming a landlord will save them rent and reduce income tax by including interest on mortgage debts. This idea is not entirely correct, unlike other countries, Switzerland takes into account rental income in the tax return of the owner(s) even if no rent is actually received because the property was occupied or not.Even if no rent is actually received due to the fact that the property was occupied by the owner(s), this practical approach of the tax authorities automatically results in income tax.

Becoming a homeowner is not always a fiscally advantageous project for buyers. The tax authorities calculate the rental income for owner-occupied properties in Switzerland according to the surface area, the location and the tax value. This rental income added to the fact that you are an owner generally corresponds to the rent you should pay, which brings us back to the starting point of income tax before buying a property. In other words, if you decide to buy the same flat you currently occupy, the tax burden you pay on top of that is more or less the rent you pay as a tenant.

Buying a property requires a thorough tax study, there are certain approaches you can take that allow you to pay less tax even if you own property in Switzerland or abroad.