Tenancy and Taxes: What Renters in Switzerland Should Know

Most people in Switzerland live in rented apartments. While homeowners are heavily involved in taxes through imputed rental value, mortgage interest, and renovation costs, many renters ask: what tax aspects apply to me?

Even renters can deduct certain expenses, although they do not benefit from the same advantages as property owners. At the same time, rental relationships are subject to strict legal rules. This article explains which tax points are relevant for renters and how tenancy law plays a role.

Principles for Renters

No Imputed Rental Value Tax

Unlike homeowners, renters do not have to pay tax on imputed rental value. They pay rent directly from already taxed income.

Comparison with Homeowners

Renters have fewer tax deduction options but benefit from clear rights under tenancy law, e.g., regarding utilities or rent increases.

Tax Deduction Options for Renters

Professional Expenses and Commuting

Renters can claim costs for commuting or a home office under certain conditions.

Utilities

Utilities are generally not directly deductible. However, if used for work (e.g., home office, heating for workspaces), part may be considered.

Insurance

Premiums for household and liability insurance are deductible under general insurance deductions.

Tenancy Law Aspects with Tax Relevance

Utility Billing

Renters have the right to inspect detailed utility bills. This prevents costs for value-enhancing investments from being passed on in the rent, which would not be deductible.

Rent Increases

Rent increases must be justified (e.g., rising mortgage interest or value-enhancing investments by the landlord). For renters, these adjustments do not have a direct tax effect.

Second Homes and Taxes

Tax Considerations

If a renter uses a second home (e.g., for weekday stays near the workplace), this must be declared on the tax return. In some cantons, part of the rent may be recognized as a professional expense.

Example

An employee lives on weekdays in a rented apartment in Zurich and at weekends in their main residence in Lucerne. Rental costs for the second apartment may, under certain conditions, be deductible as professional expenses.

Practical Examples

Example 1: Home Office in a Rented Apartment

A renter in Basel uses a separate room exclusively as a home office. Under certain conditions, a portion of the rent can be claimed as professional expenses.

Example 2: Commuting Apartment

An employee rents a small second apartment in Bern for the workweek. The costs may be deductible because the main residence is far away.

Common Mistakes and Tips

Common Mistakes

• Assuming the full rent is tax-deductible
• Not checking utility bills
• Failing to declare second homes

Tips

• Only claim clearly defined professional expenses
• Check and keep utility bills
• Clarify tax deduction possibilities for second homes early

Conclusion

Renters in Switzerland have fewer direct tax deduction options compared to homeowners. Nevertheless, certain costs, such as second homes, home offices, or insurance, can be relevant for taxes.

Tenancy law also protects against excessive utility costs or unlawful rent increases. Knowing your rights and carefully completing your tax return allows renters to benefit from tax advantages as well.