Tenancy and Taxes: What Renters in Switzerland Should Know

Most people in Switzerland live in rented accommodation. While homeowners are heavily involved with imputed rental value, mortgage interest and renovation costs for tax purposes, many tenants wonder: What tax aspects apply to me?

Tenants can also claim certain costs for tax purposes, but 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 tenants and how tenancy law plays a role.

Basic principles for tenants

No imputed rental value taxation

Unlike homeowners, tenants do not have to declare an imputed rental value. They pay their rent directly from taxed income. This means: the rent itself is not tax-deductible.

Distinction from homeowners

Tenants have fewer tax deduction options but benefit from clear rights under tenancy law, particularly regarding utility costs, rent increases and protection against termination. Additionally, tenants do not need to declare any property value as an asset.

Tax deduction options for tenants

Professional expenses and commuting deductions

Tenants, like all taxpayers, can deduct professional expenses:

• Commuting costs to the workplace (public transport pass or mileage allowance, with cantonal upper limit)
• Home office: Under certain conditions, a proportionate rent deduction for a room used exclusively for work can be claimed. Condition: The employer does not provide a suitable workplace.
• Work equipment: Computer, specialist literature, work clothing
• Additional meal costs: Flat-rate deduction for meals away from home

Insurance

Premiums for household and liability insurance are deductible as part of the general insurance deduction. This deduction also includes health insurance premiums, life insurance premiums and Pillar 3a contributions.

Moving costs

Moving costs can be claimed for tax purposes if the move is work-related – for example, when a job change requires a change of residence. The costs of transport, cleaning the old apartment and any double rent payments can be deducted.

Other possible deductions

• Utility costs are generally not directly tax-deductible.
• Energy costs (electricity, heating) for professionally used rooms can be proportionally considered.
• Self-paid medical costs (above the deductible threshold)

Tenancy law aspects with tax relevance

Utility cost statement

Tenants have the right to inspect a detailed utility cost statement. This is not only important under tenancy law but can also be tax-relevant: the statement shows which costs are attributable to the tenant. For professional use, proportionate energy costs can be considered.

Rent increases and the reference interest rate

Rent increases must be demonstrably justified – for example through adjustments to the mortgage reference interest rate, rising maintenance costs or value-enhancing investments by the landlord. The reference interest rate is published quarterly by the Federal Office for Housing. Rent increases have no direct tax impact for tenants as rent is not deductible – but they affect the overall financial burden.

Deposit

The rental deposit (usually held in a blocked account) remains part of the tenant’s assets and must be declared in the tax return. Any interest on the deposit account is taxable as income.

Second homes and taxes

Tax considerations

Tenants who use a second home (e.g. for weekly stays at the workplace) must declare this in their tax return. Under certain conditions, the costs can be deducted as professional expenses:

• The distance to the main residence must be so great that daily commuting is unreasonable.
• Close personal ties must exist at the main residence (e.g. family).
• Deductible costs include: rent, utility costs and additional meal costs.

Example

An employee lives weekdays in a rented apartment in Zurich and weekends at their main residence in Lucerne. The rent for the second home, utility costs and a flat-rate meal deduction can be claimed as weekly commuter costs for tax purposes.

Tax-saving tips for tenants

Even though tenants have fewer direct property deductions, they can strategically reduce their tax burden:

• Use Pillar 3a: The maximum deduction (CHF 7,258 with pension fund, as of 2025/2026) directly reduces taxable income.
• Pension fund purchases: Voluntary purchases into Pillar 2 are also deductible.
• Training costs: Up to CHF 12,000 per year deductible if the training is work-related.
• Donations: To charitable organisations, generally up to 20% of net income.

Practical examples

Example 1: Home office in rented apartment

A tenant in Basel uses a separate room exclusively as an office. Since her employer does not provide a workplace in the office, she can deduct the proportionate rent and energy costs for this room as professional expenses.

Example 2: Commuter apartment

An employee rents a small second apartment in Bern for the working week. His main residence is in Valais where his family lives. The rent, utility costs and a flat-rate meal deduction can be claimed as weekly commuter costs for tax purposes.

Example 3: Work-related move

An employee changes jobs from Geneva to Zurich and needs to move. The costs for the moving company, apartment cleaning and one month of double rent can be claimed as work-related moving costs.

Common mistakes and tips

Common mistakes

• Assuming that the entire rent is tax-deductible
• Not checking the utility cost statement
• Not declaring second homes
• Not declaring the rental deposit as an asset
• Not claiming work-related moving costs

Tips

• Only claim clearly defined and documented professional expenses
• Check and archive utility cost statements
• Clarify tax deduction options for second homes early
• Declare rental deposit as an asset (include blocked account statement)
• Strategically use pension deductions (Pillar 3a, pension fund) to compensate for missing property deductions

Conclusion

Tenants in Switzerland have fewer direct tax deduction options compared to homeowners. However, certain costs such as second homes, home offices, work-related moves or insurance can be tax-relevant. The rental deposit must also be declared as an asset. Tenancy law additionally protects against excessive costs through utility charges or unjustified rent increases. Those who know their rights, complete their tax return carefully and strategically use pension deductions can also benefit from tax advantages as a tenant.