Which costs can homeowners deduct from their taxes?

Deductible items include mortgage interest, value-preserving maintenance costs, insurance premiums and management costs. In the Canton of Zürich, you can alternatively choose a flat-rate deduction of 20% of the imputed rental value.

Is indirect amortisation via Pillar 3a worthwhile?

Yes, with indirect amortisation you benefit twice: the mortgage interest deduction is retained and the 3a contribution is tax-deductible.

Can I deduct renovations for tax purposes?

Value-preserving renovations are fully deductible. Tip: spread larger renovations over two tax years to optimise the tax progression effect.

How does property maintenance reduce the tax burden?

You can choose between the flat-rate deduction (20% of the imputed rental value) and the actual costs – depending on which is higher. In years with major repairs, the actual cost method is worthwhile.

Saving Taxes When Buying Property: 7 Legal Strategies

With home ownership you save, according to the article, CHF 5'000 to CHF 25'000 in taxes per year in Switzerland – entirely legally. The seven levers: choosing the right municipality (municipal tax multiplier in the Canton of Zurich 71% Rüschlikon to 130% Dietikon), deducting value-preserving renovations, staggering the Pensionskasse advance withdrawal, using Säule 3a (max. CHF 7'056 for employees in 2026), amortising indirectly, condominium instead of single-family ownership and optimising the mortgage strategy. In the example (married couple, Kilchberg), all strategies together yield CHF 23'280 per year, over 20 years CHF 465'600. Note: the abolition of the Eigenmietwert decided in March 2024 fundamentally changes the deductions.

How strongly does the choice of municipality affect taxes?

In the Canton of Zurich, the municipal tax multiplier varies between 71% (Rüschlikon) and 130% (Dietikon). For a taxable income of CHF 150'000, this results in an annual difference of over CHF 15'000. Comparing Rüschlikon (71%) to Winterthur (122%), the difference is CHF 12'567 per year – over a 20-year ownership period more than CHF 250'000, solely through the choice of municipality.

How much does Säule 3a contribute to saving taxes?

The annual maximum contribution to Säule 3a in 2026 is CHF 7'056 for employees and CHF 35'280 for the self-employed – fully deductible from taxable income. On an advance withdrawal for an owner-occupied home, only a capital-payout tax of approx. 5–8% applies instead of the higher income tax. Tip: close 3–5 separate Säule 3a accounts in different tax years to break the progression.

Which renovations are deductible and how do you stagger them?

Value-preserving renovations such as renewing the kitchen, replacing the heating or painting the façade are fully deductible; value-increasing investments such as an extension, pool or garage are not. Because income tax is progressive, spreading them over several years is worthwhile: a CHF 50'000 deduction per year yields more than CHF 100'000 all at once. At the jump from the 25% to the 35% marginal tax rate, the savings per CHF 10'000 rise from around CHF 2'500 to CHF 3'500.

What does indirect amortisation via Säule 3a achieve?

Instead of amortising directly, you pay the maximum contribution (CHF 7'056/year) into Säule 3a and pledge the account to the bank. This way the mortgage stays high and the interest deductible, while the Säule 3a contribution additionally saves taxes. Result: approx. CHF 2'500–3'500 in tax savings per year, over 20 years CHF 50'000–70'000. Mortgage interest is, according to the article, 100% deductible without limit.

What does the abolition of the Eigenmietwert change about tax optimisation?

The Swiss Parliament decided in March 2024 to abolish the Eigenmietwert, expected to take effect in 2026 or 2027. With this, the deduction of mortgage interest and value-preserving maintenance costs for owner-occupied properties also ceases. Energy-related renovations, however, remain deductible (Art. 32 para. 2 DBG, since 1990; spreading over up to three tax periods since 2020). Larger renovations should therefore ideally be planned before the reform.