Imputed rental value and maintenance costs: how the declaration works

What is the imputed rental value?

The imputed rental value corresponds to the amount owners would earn if they rented out the property they live in. This notional income is taxed as income, even though no actual rent is received.

It is set by the cantonal tax authorities on the basis of comparable values or valuation procedures. The amount may change in the event of conversions, extensions or general revaluations.

The imputed rental value is taxed together with your other income and therefore also affects the applicable tax rate. For many owners it represents a significant item in the tax return that should be taken into account when planning the budget.

Since the calculation methods differ from canton to canton, the same type of property may be valued differently depending on its location. If you are unsure, the cantonal guidelines or the tax administration itself can provide information on the specific method of calculation.

Actual costs or lump-sum deduction

For maintenance costs, you can generally choose between deducting the actual, documented costs and a lump sum. The lump sum is usually based on the imputed rental value or the tax value of the property.

Switching between the two methods is often possible from year to year. If you are planning major renovations, you should collect the receipts carefully, as the deduction of actual costs is usually worthwhile in such years.

• Collect receipts for repairs and maintenance work
• Keep invoices from tradespeople
• Document premiums for building insurance
• Record the property's administration costs

Comparing the lump sum and actual costs

Whether the lump sum or the deduction of actual costs is more worthwhile depends heavily on the condition of the property and the work carried out in the year in question. In years without major renovations, the lump sum is often simpler and sufficient.

In years with extensive maintenance work, however, switching to the actual, documented costs can pay off. Comparing both options before completing the tax return provides clarity and prevents a possible deduction from going unused.

Value-preserving versus value-enhancing

Only value-preserving measures are deductible as ongoing maintenance. These include, for example, replacing an existing heating system or renovating a bathroom to the previous standard.

Value-enhancing investments, such as an extension or a first-time increase in comfort, are treated differently for tax purposes and only have an effect on a later sale through the property gains tax.

Special cases involving imputed rental value and maintenance

For vacant properties, second homes or condominium ownership, the rules for determining the imputed rental value sometimes differ. Changes of use can also lead to an adjustment.

As the political debate surrounding the imputed rental value is constantly evolving, it is worth checking the current practice in your canton.

If ownership changes during the year, for example through inheritance, gift or purchase, the question also arises as to how the imputed rental value is apportioned between the persons involved. Such situations are usually clarified by the tax authority as part of the ordinary assessment.

What you should check

• Amount of the current imputed rental value according to the assessment
• Receipts for the year's actual maintenance costs
• Comparison between the lump sum and the deduction of actual costs
• Distinction between value-preserving and value-enhancing measures
• Premiums for building and property insurance
• Any changes resulting from conversions or a change of use

Frequently asked questions