Tax Calculator for Rental Property Switzerland

Taxes on Rental Income in Switzerland

Rental income from investment properties in Switzerland is subject to income tax on three levels: federal, cantonal and municipal. Direct federal tax is the same for all cantons, while cantonal and municipal taxes vary widely. Combined marginal tax rates can reach 22% to 45% for high incomes — depending on the canton and municipality.

The key point is that net rental income — i.e. after deducting all allowable costs — must be declared as income. This means: the higher your other income, the more expensive the rental income becomes due to the progressive tax rate.

What Deductions Are Available?

Swiss tax law allows various deductions that significantly reduce taxable net rental income:

• Mortgage interest: Fully deductible — one of the most effective levers.
• Maintenance costs (flat rate deduction): Instead of actual costs, a flat rate deduction can be chosen: 10% of rental income for properties under 10 years old, 20% for older properties. Some cantons grant a flat 20%.
• Management costs: Costs for external management are deductible.
• Insurance premiums, fees: Building insurance and similar costs can be claimed.

Tip: Each year, choose afresh whether the flat rate or actual costs are more favourable — especially in years with major renovations, proving actual costs is worthwhile.

Wealth Tax on Real Estate

In addition to income tax on rental income, real estate assets are subject to wealth tax. The decisive factor is not the market value, but the cantonal tax value, which is generally 60–80% of the market value. The outstanding mortgage is subtracted from this tax value — only the net wealth is taxed.

Wealth tax rates differ considerably: Zug levies around 1.5‰, while Geneva comes in at over 9.5‰. For owners with large portfolios, wealth tax can represent a significant annual cost factor.

Property Tax

Property tax (also called land tax) is a cantonal peculiarity: 19 cantons levy it, 7 cantons do not. Tax-free are: Zurich (ZH), Schwyz (SZ), Glarus (GL), Zug (ZG), Solothurn (SO), Basel-Land (BL) and Aargau (AG).

Where it is levied, it is calculated on the official or tax value of the property — regardless of mortgages or income. Rates vary from approx. 0.3‰ to 1.5‰ of property value per year.

Calculation Formula

immometrics calculates the total tax burden according to the following logic:

• Taxable income from property = gross rental income − mortgage interest − maintenance costs (flat rate)
• Income tax = taxable income × income tax rate (federal + cantonal + municipal)
• Wealth tax = (tax value − mortgage) × wealth tax rate
• Property tax = tax value × property tax rate (where applicable)
• Total tax burden = income tax + wealth tax + property tax