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Until now, homeowners have had to declare the so-called imputed rental value – a fictitious rental income for their own home – as taxable income. In return, they were allowed to deduct mortgage interest and maintenance costs from their taxes.
Following the referendum of September 2025, this system will be abolished. Subject to a corresponding decision by the Federal Council on its entry into force, the new rules are expected to apply from around 2028: no more fictitious rental value – but also no more deductions.
This means that in the future, anyone repairing their roof, repainting the façade, or replacing the heating system will no longer be able to deduct these costs from their taxable income. Depending on income, renovations could therefore become up to 40 percent more expensive.
Property owners now need to plan carefully. Anyone already considering modernizing a bathroom or replacing windows should act sooner rather than later.
According to experts, the closer the new law comes into effect, the more likely a wave of renovations will occur – leading to higher prices and longer waiting times.
Until 2028, there remains a time window during which value-preserving work such as roof or façade renovations can still be deducted for tax purposes. Value-enhancing investments, such as adding a conservatory or an extension, were already non-deductible under the current system.
Many banks only finance projects that increase the value of the property. Pure maintenance or refurbishment work is considered value-preserving and is therefore often not eligible for mortgage financing. In such cases, a personal loan can provide a flexible alternative.
With a loan, renovations can be carried out easily and without a land register entry.
The term can be chosen individually, keeping the budget predictable while ensuring the work is completed on time.
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The abolition of the imputed rental value is one of the most significant tax reforms for property owners in decades. It brings greater simplicity, but fewer tax advantages.
Those who plan now and finance wisely can benefit one last time from the deductions and make their home fit for the future.
cashgate is a brand of the Cembra Group
Calculation example: For a cash loan of CHF 10,000 with a term of 12 months and an effective annual interest rate between 3.9% and 9.9%, the monthly instalment ranges between CHF 850.73 and CHF 876.73, and the total interest costs range between CHF 208.78 and CHF 520.76. The lender is Cembra Money Bank Ltd., based in Zurich. The granting of credit is prohibited if it leads to the consumer becoming over-indebted. This offer is exclusively available to persons resident in Switzerland.
