Taxation

Published by : dl

Taxation

In this section, we cover the important details of real estate taxation:

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Marginal tax rate

In order to develop an efficient tax strategy, you should consider the marginal tax rate. Let us help you understand what this means.

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Transfer duties

Transfer duties are levied on all real estate purchases. In the Suisse romande cantons, these transfer duties are usually paid by the buyer.

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Rental value

Every owner may deduct maintenance costs and interest expenses from their taxes. The tenant, however, has no possibility of deducting their rent (except for small tax payers in the canton of Vaud).

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Tax on real estate gains

Tax on real estate gain is levied on profit earned from the sale of real estate minus allowances (brokerage fees, transfer duties, value added works, etc.)

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Real estate income

Income from property rental, land rental, land occupency rights and usufruct rights are all forms of real estate income that are considered taxable rental return.

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Land tax

Some cantons levy land tax--also known as real estate tax--at the cantonal and/or communal level. The tax rate varies between 0.3 and 3.0 per mil of the actual cash value or the return value or even a combination of the two.

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Maintenance costs

On the federal level, the owner can deduct the following: necessary maintenance costs on the building, renovation fees for newly acquired buildings, insurance premiums, third-party administration costs and investments in sustainable energy.

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Standard deductions

If, throughout the course of one year, your maintenance costs are little to none, you still have the possibility to deduct a standard amount that is, for most direct federal taxes, 10% (for properties 10 years-old or less) and 20% (for properties older than 10 years) of the rental value or of the gross return on rental income.

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Limitations to debit interest deductions

Since 1 January 2001, deduction of debit interest is subjected to certain limitations.

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