Imputed rental value: what its 2029 abolition means for you
Switzerland is abolishing the Eigenmietwert — voters said yes on 28 September 2025 with 57.7%. From 2029 the tax on the notional rental value disappears, but mortgage-interest and maintenance deductions largely go too. Who wins, who loses — with a calculator.
Federal vote of 28 September 2025
After more than 90 years: from 1 January 2029 the tax on the imputed rental value disappears — in return, mortgage-interest and maintenance deductions largely fall away.
What the imputed rental value is
For over 90 years, anyone who owns and lives in their home has had to pay tax on an imputed rental value — a notional income for “living in your own house”. The logic: living rent-free in your own property saves you a rent, so you should not be taxed more favourably than a tenant. The imputed value is added to taxable income and is usually 60–70% of the market rent (the Federal Court requires at least 60% for cantonal tax).
To balance it, owners may deduct their mortgage interest and their maintenance and renovation costs from income. It is exactly this system — tax the imputed value, deduct interest and upkeep — that is now being scrapped.
The reform on a timeline
Through tax year 2028 the current system still applies: the imputed value is taxable and today’s deductions remain usable. The homeowners’ association (HEV) is pushing for an earlier date (2028).
What actually changes
Example · CHF 18,000 imputed value
This also removes the tax incentive to keep a large mortgage: today many owners benefit from deducting high interest. In future, interest on an owner-occupied home is — apart from the limited first-time-buyer deduction — no longer deductible.
All the changes at a glance
Today versus from 2029
| Today (until 2028) | From 2029 | |
|---|---|---|
| Imputed rental value | taxed as income | removed |
| Maintenance & renovation | deductible | no longer deductible |
| Mortgage interest (own home) | deductible | first-time buyers only, time-limited |
| Energy-saving measures | deductible | federal: removed; cantonal: until 2050 max |
| Second homes | imputed value taxed | new cantonal object tax possible |
Winners and losers
Whether you benefit depends mainly on the mortgage-rate level and your debt. Rule of thumb: at low rates most owners win; at high rates (from about 3%) most lose, because the lost interest deduction then outweighs the removed imputed value.
- Winners: debt-free or lightly indebted owners and pensioners — they pay tax on the imputed value today but can barely deduct any interest.
- Losers: recent buyers with a big mortgage and households that deduct a lot of maintenance — they lose more in deductions than the imputed value was worth.
- Second-home owners: additionally affected if their canton introduces the new object tax (mainly tourism cantons such as Grisons, Valais, Ticino).
Work it out for yourself
Abolition: winner or loser?
You save tax
Winner−CHF 1,800
Taxable income falls by CHF 6,000 per year
Simplified estimate from 2029. Excludes the temporary first-time-buyer interest deduction, the possible cantonal object tax on second homes, and any cantonal energy deductions. The marginal rate is the rate on your last franc of income.
What you can do before 2029
- Review larger renovations: maintenance and renovation costs are only deductible until 2028. If you plan to renovate anyway, check the timing — value-adding work before the change can pay off for tax.
- Rethink your amortisation: the incentive to keep a large mortgage for tax reasons disappears. Faster amortisation may become more attractive after the change.
- First-time buyers: those buying their first owner-occupied home can still use a time-limited interest deduction after 2029, with transitional rules for recent first purchases.
- Get advice: the effect depends heavily on canton, rates and your situation. Consult a tax adviser before major decisions.
Frequently asked questions
- Is the imputed rental value already abolished?
- No. Voters approved the abolition on 28 September 2025, but it only takes effect on 1 January 2029. Through tax year 2028 the current system applies.
- What falls away in return?
- Mainly the deductions: maintenance and renovation costs and the mortgage-interest deduction on your own home largely disappear. Exceptions: a time-limited first-time-buyer deduction and pro-rata interest for rented property.
- Will I benefit from the abolition?
- Usually yes if you carry little debt (e.g. as a pensioner). If you hold a large mortgage or renovate a lot, you may pay more tax — especially at higher interest rates.
- What changes for second homes?
- Their imputed value disappears too. In return, cantons may levy a special object tax on predominantly owner-occupied second homes — whether and how is up to each canton.
- And for tenants?
- Directly, little: for most tenants the reform has no noticeable effect. Indirectly, public-revenue shortfalls could affect everyone, depending on the rate level.