Imputed rental value ends 2029: renovate now, use deductions

Not tax advice: this article summarises information published by the authorities (as of October 2026). Please clarify the tax effect of a renovation in your case with your fiduciary or the tax office of your municipality or canton.

What was decided?

On 28 September 2025, the people and the cantons approved the federal decree on cantonal property taxes on second homes with 57.7 % yes (turnout 49.5 %). Because the federal act on the change of system in the taxation of residential property is legally linked to it, the abolition of the imputed rental value was also decided.

On 1 April 2026, the Federal Council decided to bring the reform into force on 1 January 2029. At the same time, the cantons may introduce a special property tax on mainly owner-occupied second homes.

What changes from 2029?

Sources: Federal Council/FTA press release of 1.4.2026; Federal Act on the change of system in the taxation of residential property (AS 2026 213).
Topic	Today (up to tax year 2028)	From 1 January 2029
Imputed rental value, owner-occupied	taxed as income	abolished (primary and second homes)
Maintenance costs, owner-occupied	deductible	deduction abolished at federal, cantonal and municipal level
Investments in energy saving and environmental protection	deductible	direct federal tax: deduction abolished; cantons may keep it for a limited time, until 2050 at the latest
Rented properties	maintenance deductible	maintenance deduction remains
Debt interest	deductible	only in proportion to rented properties; temporary first-time buyer deduction
Monument preservation	deductible	federal: still deductible (non-subsidised part); cantons may provide for the deduction

Abolition of the imputed rental value: why renovating before 2029 can make sense

As long as the imputed rental value is taxed, you can deduct the costs of maintaining your owner-occupied home and investments that serve energy saving and environmental protection from your taxable income. In the canton of Zurich, energy investments in existing private properties are treated like maintenance costs, insofar as they are deductible for the direct federal tax.

From tax year 2029 this deduction for owner-occupied property is dropped for the direct federal tax. If a heating replacement, new windows or insulation is due in the next few years anyway, it may therefore be worthwhile to plan the project so that the costs still fall under current law.

Clarify in advance with the tax office or your fiduciary which tax year is decisive (for example invoice date, payment or completion of the work). Also allow enough lead time: subsidies, permits and delivery times take time.

Will the cantons keep the energy deduction?

Federal law allows cantons to keep deductions for energy saving and environmental protection until the goal of a balanced greenhouse gas balance is achieved, but until 2050 at the latest. Which costs would then be deductible is determined by the Federal Department of Finance together with the cantons – according to the Zurich government, this had not yet been determined in September 2026.

Canton of Zurich: the cantonal government currently does not consider it appropriate to keep the deduction (RRB No. 454/2026). On a motion seeking to keep the deduction until 2050, it recommends rejection but is prepared to accept it as a postulate (RRB No. 908/2026). The cantonal parliament's decision is pending.

Aargau, Lucerne, Zug, Basel-Stadt and Basel-Landschaft: we have found no final decision for these cantons by the editorial deadline. Ask the cantonal tax office about the current status.

Subsidies remain – independent of taxes

Subsidies from the canton, municipality and energy utility (Buildings Programme) are not directly affected by the change of system. When replacing oil, gas or electric heating with a heat pump, there are several thousand francs depending on the canton – the application must be submitted before work starts. As a rule, only the part of the costs you bear yourself is tax-deductible.

Heat pump subsidies Replace oil and gas heating

Frequently asked questions

When does the abolition of the imputed rental value take effect?

The Federal Council has brought the reform into force on 1 January 2029. From tax year 2029 the imputed rental value on owner-occupied property will no longer be taxed.

Can I still deduct maintenance costs from 2029?

Not for owner-occupied property – neither at federal level nor in cantons and municipalities. For rented or leased properties the deduction remains.

Is the deduction for energy-efficient renovations gone completely?

For the direct federal tax, yes. The cantons may keep it for a limited time, until 2050 at the latest. Whether your canton does so is partly still open.

Is a heating replacement worthwhile just because of taxes?

Not on its own. What matters is the condition of the system, energy and maintenance costs, cantonal regulations and subsidies. The tax deduction can be an additional advantage – have it checked individually.

Sources

As of October 2026. No guarantee – the regulations and programmes of the federal government, canton and municipality are authoritative.

Not tax advice: this article summarises information published by the authorities (as of October 2026). Please clarify the tax effect of a renovation in your case with your fiduciary or the tax office of your municipality or canton.

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Abolition of the imputed rental value: why renovating now can pay off