Why are landlords taxed on uninhabited properties
Landlords can deduct this from their taxes
Brokers, maintenance costs, investments in energy efficiency: if you rent a property, you have some costs, but you can also deduct some of them from your tax. An overview of the items that landlords should not forget on their tax return.
Landlords have to pay tax on their rental income and have some expenses - from maintenance to renovation costs. And if the tenant changes, the agent has to be paid too. In return, however, landlords can deduct some of the tax and recoup as much of what they spent on their property. To do this, they have to prove their expenses with a receipt or invoice when filing their tax return. It is therefore essential for landlords to collect and store such documents so that the costs can be taken into account later in the tax return.
Landlords can deduct these items from their taxes
In principle, all costs that are necessary for the maintenance or renovation of the home are deductible. But landlords can also deduct other expenses from the tax:
Administrative expenses, brokers and real estate ads
When renting out, certain property management costs are generally deductible. These include, for example, the costs for the property manager, the broker or the costs for real estate advertisements. Any cash expenses incurred by the landlord himself, such as bank charges or telephone or postage costs, are also deductible. On the other hand, the costs of self-administration are not deductible. If the landlord manages and brokers the property himself, he is not allowed to deduct anything from the tax return.
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Often landlords finance their property through a mortgage loan. The monthly loan installment to be paid to the bank consists of repayments and interest. Landlords can also deduct this debt interest from their taxes.
Acquisition and production costs of the property
The purchase price or construction costs as well as any maintenance costs can also be stated in the tax return.
The maintenance costs include the work that is necessary to maintain the property. A distinction is made between value-maintaining and value-adding work. In principle, value-preserving work is permitted for tax deduction. This category includes, for example, the equivalent renovation of the facade or the purchase of a new heating system after the old one no longer works.
Expenses that add value cannot initially be deducted. Property owners should nevertheless carefully document these and keep any invoices. The reason: In the event of a later sale, all cantons levy property gains tax. Value-adding work can then be used to lower that tax. The various cantons have different guidelines in this regard.
Preserving or adding value?
It is not always easy to distinguish whether a certain measure in the rented apartment was value-preserving or value-increasing. If you renovate a kitchen, for example, you may be installing a higher quality one than before. In order to prevent later disputes with the tax office, timely advice from an expert and a detailed list of all costs is recommended.
Investing in energy efficiency
Anyone who invests in the energy efficiency of their property can also claim these costs from the tax office. It doesn't matter whether he insulates his roof, has energy-saving windows installed or uses renewable energies. It is only important that the work is carried out by a specialist company - so if you want to insulate yourself, you cannot deduct anything from your tax return.
Flat-rate or effective deduction
Incidentally, the amount that can ultimately be deducted from the tax is partly up to the landlord. With the exception of the canton of Lucerne, they can determine whether they want to deduct a certain percentage of the gross rental income from tax or the actual costs. In the case of renovation work and investments in energy efficiency, this is the amount that is ultimately shown on the invoice of the specialist company. This can include both material and labor costs.
Observe cantonal regulations
The costs mentioned here are all tax deductible throughout Switzerland. In the individual cantons, however, there are often additional options for saving taxes. In the canton of Bern, for example, separate deductions apply to properties that are rented out with furniture. Landlords should therefore always inquire about the cantonal deductions on site.
Tax tips for landlords: Trustees are worthwhile
It is not always easy to see through what is particularly worthwhile for landlords when filing tax returns. For example, it can make sense to distribute certain maintenance work over several tax periods. However, only a trustee can make a final assessment. It is therefore usually worthwhile to employ one, especially for landlords of larger or more multi-family houses. Incidentally, its costs can also be deducted from the tax.
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