4 - Was tun, bevor der Eigenmietwert Geschichte ist? mit Bastian Thurneysen

Julia Tatje: to myself why we some tax issues when they are history. The own rent value is just as important. Unloved often misunderstood, and now it's to be abolished. And suddenly everyone wants to know what exactly that for me. Have I missed or can I do something right now? Welcome back to Tax in the City, the podcast where we don't in isolation, but rather where they belong, in the middle of life. Between decisions, free wishes, investments and sometimes sleepless nights. I am Julia from Taxum, a personal tax boutique in Zurich, and we accompany people with complex realities of internationally, entrepreneurial and financial-oriented and help them with

Bastian Thurneysen: Welcome to the podcast. ⁓

Julia Tatje: not only correct, but also strategically. Today we about topic that many house and apartment owners. I am especially about this guest, not only because of his professional background, but also because of our, let's unusual first encounter. I have Bastian Turneisen, lawyer at Burkhardt. We have...

Bastian Thurneysen: Today we are about the of many houses and housing signs in the Kampenberg. And I am especially about this guest, not only with his fantastic thesis, but also with our rather unusual first presentation. Because here is Bastian Thurn as a legal advocate. We have, and

Julia Tatje: And that's really no joke. He can confirm that. is an attorney after somewhere in the mountains of Lesotho on a few years

Bastian Thurneysen: that is really no joke, a little history, also bit different, met the Bärken from the next Otto Kampenberg. Especially you.

Julia Tatje: And now we're here in Zurich. Welcome, and it's that you're here. It's definitely the strangest story I've ever Before we deep, deep, into the topic of self-renting, ⁓

Bastian Thurneysen: Thank you for the invitation. That's definitely the difficult thing to learn. Before we go the topic of equity,

Julia Tatje: Take us with you How did you the field of and why do you the topic of housing ownership and tax so

Bastian Thurneysen: I would briefly about how you came the topic and why you chose to on equity and control.

Julia Tatje: often at moment?

Bastian Thurneysen: I not only a lawyer, I am also lawyer mainly with I am also tax expert, so I am confronted with tax questions.

Julia Tatje: And so we regularly and

Bastian Thurneysen: is of course the private property in my practice omnipresent. I take of many private customers their own homes, be it a second home, be self-sufficient apartment that they live And of course always questions in this context with the deductions that have far and now with the removal of the private property, of course, there.

Julia Tatje: I am to be to to the my own, the first one my second one, the my fourth one, and the my And of course am to the questions that this discussion, and conclusions that have so far. and now with the closing of the own company, of course, fell it in this respect, of course, the question was what do have until the own company has done it. Suddenly everyone was already good if you upstream 80, but of it impossible if you a new building.

Bastian Thurneysen: in this context, the planning, what do I have the own property is confiscated? everyone him. was always loved if you could the deductions, but of course was unloved if you knew how to control him or had a new building. So it's omnipresent and with the vote from last September it's even more present. Yes, is especially in Zurich, right?

Julia Tatje: Exactly, I see here as well. Many customers call and want to a lily as as It's only two years It's completely simple. The market is huge, it? those who already have something, already own something, are all to profit from this unloved own rental value and the deductions that can be made. also us both more or less. So we don't just the taxes, we also like to rebuild. and are therefore particularly close to the topic, also emotionally.

Bastian Thurneysen: Exactly. I belong to those who have just gained a foothold and are quickly some maintenance costs. I have the winner situation that I can still deductions and then the owner is removed the

Julia Tatje: Congratulations, everything went

Bastian Thurneysen: best of all.

Julia Tatje: well. Now let's get concrete. You have obviously everything terms of own rent. are the biggest mistakes you see at Everyone is talking about the withdrawal. do people they understand and don't Or what are they doing wrong?

Bastian Thurneysen: I errors in the past. For example, you do know that you can on the new I effectively the deductions valid or the partial deduction. This is standard error that you certainly see regularly in tax statements.

Julia Tatje: for example, I know that... Yes.

Bastian Thurneysen: This is not something that is but it is something that you have to keep that you year or every tax period on the new one. Can I the costs valid or can I the pay-share?

Julia Tatje: The pauschal is usually 20 percent. canton

Bastian Thurneysen: Exactly. That's self-sufficiency. That's the standard. Other mistakes are especially with mixed-use liabilities. recently had a client his own property in He had a GMBH and a KMU.

Julia Tatje: Yes,

Bastian Thurneysen: He has a warehouse for materials there and has part of his own property. But

Julia Tatje: Yes.

Bastian Thurneysen: over the last ten years he his full rental value. Or his former tax advisor has always done this. he did not it quarterly. Because he himself still rental income of his own GMBH. If you calculate to ten years, it still lot of because it was relatively high rental value or still is. it's still happening.

Julia Tatje: What I see and is that it is very difficult for people to distinguish what is valuable and what is valuable addition. that there is a logic, at the moment was declared valuable. At the latest, tax office sees it as something different.

Bastian Thurneysen: Exactly, that is the other construction site, depending on the situation you are in. a short explanation, value-gain investments that can from the income the value-increasing ones can be later in the income tax.

Julia Tatje: a short explanation, because the investments that are to directly the and the value of the profits are then to the federal government. And see both. If one the federal government distributes it, then the other can invest. Then you send the tax return to authorities. You already everything. It's Yes, unfortunately, is not

Bastian Thurneysen: see both. If someone a property, they there and so on, I say, send me the tax statement. You've already withdrawn Unfortunately, twice. So the tax office is it. But yes, is of course an evergreen. What is worth saving and what is worth multiplying.

Julia Tatje: And then we have the question of what is worth keeping and what is worth keeping. We can maybe that what I as a rule to if you already in the swimming pool in garden and it is in miserable condition and it is being it is preserved. If you never to the swimming pool and we are building one now, it being multiplied. Exactly.

Bastian Thurneysen: Exactly, exactly. I think good rule Most canton have marked plates switched on, so if you a luxury renovation now

Julia Tatje: Yes.

Bastian Thurneysen: Even if there was a kitchen before and a new kitchen came but the new kitchen is a teppanyaki grill and then not everything is removable. But that depends on the office space and there are quite helpful notes that give you a good guidance.

Julia Tatje: Yes. relatively attractive they could In the future, foreign-use property be i.e. properties. Then can debt interest the self-sufficient, this change.

Bastian Thurneysen: and that due to if I a rental car, I the so-called profit costs. these debt interest if I have financed which is the case, that property cash, but at least I the over-decade interest rates to the withdrawal. So that's this will The first buyers of liabilities will married couples,

Julia Tatje: Yes. Yes.

Bastian Thurneysen: a withdrawal of a 10,000 Aggressively, over 10 years, in first decade, in second year, nine, etc. And for single-sex this amount of 5,000 francs should be bit more that. So not the first buyers, which they usually... at a conference

Julia Tatje: Yes. Yes. effective so sein wird. So, is the 28th During the vote, the was mentioned by the Federal Government. Meanwhile, already written that will 29th was least the recommendation of of the Finance Directors. Then to the Federal Government that it will be introduced or rather it will be abolished.

Bastian Thurneysen: So, early in the morning, This number by the Federal Council during now, it almost agreed that it will in morning, 29. was least the recommendation Conference of the Finance Directors. It has suggested that early in morning, that the property should be bought off or should off. What is the background? Of course, the canton needs much more time to all the tax laws, because especially the new housing tax second-hand So the canton is free, especially those who many second-hand homes, such Carbunten, Bähren, Wallis, etc. They now to tax laws and the mills

Julia Tatje: Yes. Yes.

Bastian Thurneysen: is very slow and therefore desire of the mountain canton is, as I heard, it by 2030. It is always moving backwards and therefore I think that it is really the case that 2029.

Julia Tatje: Okay. So it's moving further and into the future. These are good news for all those who have now tried to get a trade for the next two years and who have

Bastian Thurneysen: Exactly. Absolutely.

Julia Tatje: because there a regular run on it. Logically, still this property as long as it is there. So could possibly the renovation boom a

Bastian Thurneysen: until they then will probably a cliff, because then work will become around 30 % more Yes, exactly. Although, when I through Switzerland by train, I think anyway, what else there to repair? Exactly, the houses look so much nicer than most them. And I think that's for sure, the own rental value is certainly a reason for it to be

Julia Tatje: And because then they been which is currently going on? Yes, yes. if you the Swiss, I think... What else there to say? ...the houses are so much nicer than most them. And I think that's not... The owner has a reason for that, what is,

Bastian Thurneysen: But I

Julia Tatje: but anyway... I

Bastian Thurneysen: don't any political statements about the fact he has been fired. It is what it is and you have to live and should the best you

Julia Tatje: am not any political statements about the It is as it is. It is as it is. I what important is if a home, you it once. Not with well-founded half-knowledge, but maybe with some advice. Otherwise, mistakes can just more expensive.

Bastian Thurneysen: Exactly, exactly. think a good bike more A worse bike is even more or no one Or Jatt GPT.

Julia Tatje: But worse is even more Yes.

Bastian Thurneysen: have checked but I wouldn't one by one, because the difference cantonal really big. You go into detail, depending on where the location is and in which canton. In this respect, it really to

Julia Tatje: that if you own business and you have a regulation requirement somewhere,

Bastian Thurneysen: you own and have a need for somewhere.

Julia Tatje: that check this with a reasonable risk or if you plan in the that you make some that are actually only the the construction of construction of site, that you maybe them in place and that you make reasonable value-added investments.

Bastian Thurneysen: in terms tax or if plan renovations or extensions, that you in the ones, which are mainly or actually only the general profit-earning situation, that you may in and the tax-releasing, value-saving investments until the completion of your own share.

Julia Tatje: Exactly, because you still to the liquid resources available to the renovation at Yes. Or third column. Not? Okay.

Bastian Thurneysen: Correct, correct. If the bank doesn't participate, have it somewhere So, it via the pension fund, that you make a pre-register there, which usually go should most cases. Third pillar, dissolution, etc. I wouldn't Especially up to withdrawal of your own share. Maybe the winner will later

Julia Tatje: Yes. long run.

Bastian Thurneysen: Goodnight.

Julia Tatje: It would especially annoying if the profit comes in 2030 and then we can't get Then it doesn't matter. That's true. No, you don't to here Yes, I think purely statistically.

Bastian Thurneysen: Yes, exactly. Although one may say that one use of the lottery game. So one may not that out of the One can also optimize game But that's I'm here. Tendentially not. Yes, that's true.

Julia Tatje: Maybe more in to fund. subject of third column, just again the side note, the third column can only be in full, which is is simply not useful to a single third column account. 30, 40 years and then have several hundred thousand, if you only 80,000, it's stupid. That's why it's advisable five third from It's another important side note. You pension class Gänse.

Bastian Thurneysen: Yes, the is absolutely important.

Julia Tatje: can partial payments. That

Bastian Thurneysen: But even there you limited in and in of think 20.000 is the minimum amount.

Julia Tatje: depends on the pension fund regulations. depends. But you when you made purchases before. You can a small payment. as with many tax issues, is a bit worthwhile.

Bastian Thurneysen: But you more active in Yes, exactly. you 4th is to Yes, and maybe in this context, was a question from a client of mine and that's actually an interesting idea, optimize Especially over the second pillar, or if you going to...

Julia Tatje: this one. Yes.

Bastian Thurneysen: tax cut, but it significantly less than... that you can If you plan can the second column indirectly.

Julia Tatje: Exactly, you that now, but it be more attractive because you other options anymore.

Bastian Thurneysen: Exactly.

Julia Tatje: It's to through much than too little, it's just a shame if you give

Bastian Thurneysen: And depending on the bank also participates. So if you still space in the first mortgage, you the mortgage, which you pension deposit and it later. you have to proceed with the bank and the pension deposit.

Julia Tatje: Yes. That's In the future, will be cheaper to control a property

Bastian Thurneysen: I say for that would be something could after the termination to own level to be little more tax-optimized. renovate.

Julia Tatje: on to have because the income tax simply drops. But the big tax savings levers in individual years big renovations simply away. ⁓

Bastian Thurneysen: Yes. Although, whether you effectively or under the control the I'm to a question mark behind it, because at the end of the day will be a tax evasion at the commonwealth and somehow it to compensated. Because on the spending side, we all that, it is always difficult to shorten, so is better to to the revenue side how to optimize Therefore, I could imagine that

Julia Tatje: Exactly. The tax foot for all rises.

Bastian Thurneysen: Exactly, that the tax burden on the income to for this loss in the own household. But what would be the Exactly, because at the end of the day, everyone has carry all tax-saving and not just the owner

Julia Tatje: What would be for owners than for entire population? Do you know what happened? There in certain canton, for example in Zurich, court that rent values had be which had simply been creative for that had enormous market value. Very small rent values. In addition, a new building was with apartments that, in every sense, much less valuable than the house

Bastian Thurneysen: Do you know what happened? were the of the value had to For decades, creative deep work. For objects that were the very small. The of the ⁓ house.

Julia Tatje: rents, simply because they on the purchase price. This has lot of discontent, that people who it for decades profit from rents from the 70s and 80s. there were attempts to them. So the canton of Zurich said, you don't in all cantonal do you that?

Bastian Thurneysen: As so often in Switzerland there is a maximum wild growth. I don't here as a tax advisor or tax expert, but as a citizen. The canton of Zurich was actually exemplary it regularly its property tax values and also supports on these values.

Julia Tatje: Yes. Yes.

Bastian Thurneysen: compared to other canton. For example, my home canton of the Baselstadt has in several decades. then, when it around 6, 7, 8 years people started to these values ​​to the market values. So not on the market value, but you always little lower when to property tax value and my own rental value. I mean, there it was also. So, there were wills in Basel that had their own value. You have to say, yes, that has something to do with Yes, exactly. can longer human mind. So, that point view, but that's they've just reported. But of course was then there a lack courage, because most of the these wills by one person.

Julia Tatje: Like a garage. Yes, course. That's also much easier to avoid. You would also like this will.

Bastian Thurneysen: And then suddenly the tax system you had a five-fold rental value compared to the previous year and then you had to up. That was confiscatory and that doesn't But that you the last 20 years, you can easily avoid But I absolutely agree envy speaks out of me because I would like in a villa somewhere on the Bruderholz in Baselstadt, but that's

Julia Tatje: So

Bastian Thurneysen: different topic.

Julia Tatje: if someone a villa to on the Bruder Holz, can make contact with him. Yes, everything. There is really everything.

Bastian Thurneysen: I think that's the country is so different. There's everything. And I it interesting to this to a foreigner when he to Switzerland.

Julia Tatje: Yes.

Bastian Thurneysen: And then you explain to how this in Switzerland, that every municipality can set own for As far as possible. Of we a tax harmonization law that covers most of it, but you still for one or the other. And that is for one who, for from France,

Julia Tatje: as general rule of all centralised, and more than that, maximum incomprehensible. So that is for foreigners maximum incomprehensible and the complete concept of self-renting value is also very difficult tell and one customer said it nicely once, said it's like I buy and every time I wear I have to pay and it's a bit like

Bastian Thurneysen: where everything centralist, from Paris, which is determined as incomprehensible. Yes. Yes, exactly. But we say that Switzerland was the only country...

Julia Tatje: that.

Bastian Thurneysen: that a private rental value was It was in Europe and most, or actually all countries, abolished think Germany had it until 1970 or so, but it was something similar the private rental value. But Switzerland was also pioneer. The canton of Baselstadt was the first to the private rental value. No, they other way around. They said you can the rent.

Julia Tatje: For the villa on the Bodau. ⁓

Bastian Thurneysen: I said, yes, that's not so bad, we prefer to our own rental value, but you the rent. If you look the development is still quite interesting. And then, overall Switzerland, it the war years between 1930 and 1945, in the proper law, and since then this own rental value Sometimes it more loved, sometimes it less loved.

Julia Tatje: So in the next two or three years he will be loved hotly.

Bastian Thurneysen: I say it depends on the tax environment. In past, the tax burden Then the own rent was actually grateful. the tax burden higher than the own rent, then could the income Then nobody bothered. And now with the low taxes, 15-16 years, has to the focus I think that is certainly one of reasons why it has abolished.

Julia Tatje: We can still enjoy it. We when the right time will but it will come. What you say are the top tips? What do you to consider now so that you still profit?

Bastian Thurneysen: In any case, if you ownership, what can you renovate And can you make I read summer of 2016 the is supposed to a statement. Then have planning security, when this ownership is being And then, really see how I can, or which tax period, make any deductions still valid.

Julia Tatje: Yeah. I have read the 26th should be compensated and then the plan security should be started. And is there really any way to In which time period can I any payments? I the hospital? Is it

Bastian Thurneysen: I can the hypothec. Later is more to amortize because I the interest rate complete or even I maybe invest in future, I will the maintenance now, but over the years I will see what I can do. What else is coming? The canton can...

Julia Tatje: Yes. But over the years we have been what we should do. What is more, the companies can

Bastian Thurneysen: measures or investments for environmental protection and energy savings measures can still to be

Julia Tatje: make investments in environmental protection and energy savings and can contribute to application. Better windows. PV systems.

Bastian Thurneysen: With the direct infrastructure, this no longer possible. That means if I also make a new roof there, with new insulation, better windows, heat pumps, all that stuff. If the canton or my residential canton allows in the future, then I also it back. In most cantonal revenue tax is higher than the direct federal

Julia Tatje: Yes. Probably. Because it is in the public interest that such energy repairs are made. ⁓

Bastian Thurneysen: tax. So then you can from the deduction. This applies until 2050, according to the tax harmonization law. Then this deduction is passé for the canton. But you have to decide which canton will this deduction. I personally think that most the will this position. Absolutely. Exactly. If you a position that is

Julia Tatje: I am happy or unhappy situation. You can see it however you want.

Bastian Thurneysen: I understood you, you are in... It disadvantages depending on which office you work tasks also still be off. Also for the direct federal tax. If you want there, don't it out. But certainly the value-added investments, you new bathroom, a new kitchen, etc. All this is recommended to now.

Julia Tatje: And I can only say that now we will contact craftsmen and see who has time and the fact that I often see that wrong, for example when the entrance is blocked, that's where I idea. Some companies put the payment data on account, and they just to try what country, for where I live,

Bastian Thurneysen: And what are also cantonal differences, and this is also something that I often see that wrong to come to an entry question, what has come mind now. Certain cantonal offices rely on the accounting date of the craftsman, certain on payment date, and there they are always confused again. So Basel Land, for where I live, In Baselstadt date is measured, in Baselstadt the payment date measured. So there you to decide which

Julia Tatje: where the payment data measured, what state the payment data is measured in, so there I just see

Bastian Thurneysen: practices are in the residential area, so that this planning nicely over several years, so that can as well as possible

Julia Tatje: Exactly, because that's what to all large sales. From a point view, is not reasonable to have enormous sales and in the next. The question is, can you over two calendar years to the top tax protection and simply the lower areas.

Bastian Thurneysen: with direct federal taxes, is definitely the case. from a taxable income of 100,000, the progression quite strong. So if you the progression there, it a great tax advantage.

Julia Tatje: Yes, is planning and distributing. I can summarize planning is really a must here.

Bastian Thurneysen: Thank

Julia Tatje: Both in a structural perspective and in planning perspective. Which craftsman can what and when and in a tax perspective. think all three. And with the bank, depending on...

Bastian Thurneysen: Yes, everything has to be in line with one another, so that you make of Or even with bank, if you foreign financing or something like that.

Julia Tatje: Yes.

Bastian Thurneysen: that you get a good sense there. As long as you the first hypothec, it is usually and good. So start planning early, because the end is coming soon and then it more

Julia Tatje: For all you do have a house I personally assume that the prices for renovated apartments will drop after the demolition of the property. And will be no longer the large tax savings for renovations. But under circumstances, of course, this a bit a glass-bottom look, but...

Bastian Thurneysen: I think that prices for sanitary products should be after the 8th of August. And there is no big tax-saving model for sanitary But in some circumstances, of course, it a bit of glass-bottom, but

Julia Tatje: I think that the buying prices for such real estate will probably go long run and that we can

Bastian Thurneysen: I think that the purchasing prices should be long term. And that will be a little later.

Julia Tatje: a reasonable price later, which is currently offered at a very high price.

Bastian Thurneysen: Absolutely, think that will also be somewhere because the tax advantage of a ruin is enormous. Since the creation of so-called Tymon it has been a tax savings vehicle. So that will definitely fall away.

Julia Tatje: Yes. Yes. And that is perhaps as comfort.

Bastian Thurneysen: Yes, and what I personally in this context is also will that be, so when you address

Julia Tatje: Yes. If I don't manage to find ruins should wait until 2030 and the ruins then.

Bastian Thurneysen: and

Julia Tatje: that the next ten years, purely demographically, that some ruins will the market. Yes, what I would like to say is this society, there a... Ruine is a big word, it doesn't have to be combined. That's right.

Bastian Thurneysen: Yes, of course. No, that's not as I said, if I look at the city life and the real estate in they usually very in the European comparison. And I'm

Julia Tatje: I

Bastian Thurneysen: curious how it develop if the real estate is no longer there, because the tax incentive is simply no longer there. the real estate to be or not so big anymore. And as you know, if you can you usually that. And especially if you in yourself, you have a direct benefit from So I'm curious how it will whether the real estate will still

Julia Tatje: this

Bastian Thurneysen: be good together in 20, 30 years as they are now.

Julia Tatje: It will be exciting to see that, because repairs are principle a quarter or a third more Depending on the canton, depending on income, roughly divided by the thumb, that should be about the damage.

Bastian Thurneysen: Exactly, depending on the canton. And it will be interesting to observe how the practice of tax administration will change in view of the value of the current investments. That was also the for this conference where I participated.

Julia Tatje: Yes. I ⁓

Bastian Thurneysen: that you may be bit coolant in terms of the profit tax. If you a luxury renovation of a kitchen, that you may later make a value-added part in which was perhaps not possible because it from the income tax. But that will show and there will also a cantonal practice. development, so it will be exciting.

Julia Tatje: The game will change. Today we try to every renovation as valuable. And from 2030 we will course the story around completely. If I take from our episode today, the property value may but the decisions we are making today also affect the withdrawal of the property value. Yes.

Bastian Thurneysen: Yes, absolutely. Especially if you property yourself. The immediate benefit you have from the investment is something nice.

Julia Tatje: We have also received additional advice on how to We your questions. To everyone out you have or are take care Don't everything alone, look for the necessary support from experts, is

Bastian Thurneysen: It is also good if you an additional incentive to your own position, you tax benefit with you.

Julia Tatje: All relevant links and information, contact information, also from Bastian, you in the show notes. Thank for being here and for us a few stories for the complex topic will from again in the podcast, because there two three tax topics that I would like to discuss with you. Thank you for being And just another episode of Tax in the City. Thank you, Bastian.

Bastian Thurneysen: Thank you for the invitation.