Home ownership taxation: What still applies until 2029 – and what to plan now

What will change in 2029

From tax year 2029, the imputed rental value will be abolished entirely as taxable income. In return, the deduction of mortgage interest for owner-occupied property will also be eliminated (no longer deductible for primary residences). Maintenance and operating cost deductions for the owner-occupied property will similarly be removed. Energy efficiency and environmental improvement measures are expected to remain deductible – the precise rules are still being finalised in parliament. Different provisions apply to second homes and holiday properties: cantons will be entitled to introduce a special property tax on predominantly owner-occupied second homes.

What property owners should plan now

The years 2026 to 2028 represent the final phase in which mortgage interest and maintenance costs remain fully deductible. This opens up concrete planning opportunities: renovations and energy upgrades intended to benefit from tax deductions should ideally be carried out in 2026 to 2028. Those planning a major renovation can optimise the tax benefit by spreading it across multiple years (e.g. 2027 and 2028). The mortgage strategy also deserves reconsideration: after 2029, amortising the mortgage will no longer bring a tax benefit from lost interest deductions – meaning the optimal level of debt will change. It is also worth calculating the effect on your personal tax liability well in advance, particularly if your current imputed rental value is high.