Rental value

This concept, established during the 1940s, impacts any real estate owner living in their property.

A non existant income will be added to the owner(s) taxable income.

Each state (canton) will estimate the rental value of the property. This value is generally lower than the actual rent you could receive by renting it. A good exemple if the state of Valais. There, the rental value is about 60% of the actual renting potential of the property.

Investment properties are not affected by the rental value, since the actual rent of such properties is added to the owner taxable income.

How rental value impacts your income

Exemple: A buyer had, before becoming a home owner, a taxable income of CHF 150k. The rental value of the property he/she bought is CHF 18k. His/her new taxable income will be then CHF 168k.

Fortunately, this owner will be able to do a few new tax deductions :

• The annual mortgage loan interest paid
• A tax maintenance fees flat rate or the actual maintenance costs paid for the year
• Other deductions possible depending on your personal situation

Once everything is considered, the rental value has usually a minimal impact on the buyer taxable income.

By meeting with us, you will be able to know precisely how you will be affected by it, and what strategy to establish in order to be the most efficient.