Property gains tax
When you sell a property in Switzerland, the property gains tax ("Grundstückgewinnsteuer" in German, "Impôt sur les gains immobiliers" in French) is due. This tax is levied on the profit, that is, the difference between the selling price and the acquisition costs. Value-enhancing investments, as well as additional costs (notary fees, broker commissions, etc.), can be deducted from the profit.
The property gains tax exists in all cantons. In Zurich and Zug, the property gains tax is collected by the municipalities, while in Basel-Stadt, Bern, Freiburg, Graubünden, Jura, Obwalden, and Schaffhausen, it is levied by both the canton and the municipalities. In all other cantons, it is only collected by the canton. The tax rate is usually around 40% on profits over 100,000 CHF. Smaller profits are often subject to lower taxation or are entirely tax-free.
All cantons except Solothurn impose a percentage surcharge on properties that were acquired recently. This was put in place to discourage speculation and stabilize the market. Conversely, as the holding period increases, the tax rate decreases. Depending on the duration of ownership, you can save a significant amount of money by waiting a few months before selling and thus moving into a lower tax bracket.
If you use the proceeds from the sale to acquire a new property within a specific timeframe, the property gains tax is waived. This scenario, known as a 'replacement purchase' ("Ersatzbeschaffung/ "acquisition d'un logement de remplacement"), can only be claimed for properties that are permanently and owner-occupied.
Property transfer tax
Property transfer tax ("Handänderungssteuer" / "Droit de mutation") is levied on the transfer of ownership of a property to a new owner. The tax rate varies depending on the canton, typically ranging from 1 to 3% of the purchase price. Some cantons reserve the right to tax the fair market value instead if the transfer is made at a price below market value.
The property transfer tax is paid either by the buyer or by both the buyer and the seller. In most cases, the tax is divided equally between the buyer and the seller, with both parties jointly responsible. In the cantons of Zurich, Uri, Glarus, Zug, Schaffhausen, Aargau, and Ticino, there is no property transfer tax in the traditional sense.
In most cantons, property transfers between spouses and descendants are tax-exempt or subject to lower taxation. Property transfer tax is also waived in many cantons for gifts and inheritance.
For the exact legal provisions in your location and for your specific case, it is advisable to consult with your local real estate agent.
Notary fees
In Switzerland, any property transfer involving real estate must be publicly notarised. This means that a purchase agreement is only valid when it is authenticated by a notary.
For the notarisation of the purchase agreement, notary fees are incurred. These fees are either a percentage of the purchase price (typically around 0.1 to 0.5%, depending on the canton), or they are based on the time and effort expended. Usually, the notary costs are split equally between the parties involved.
Since notarial services are under the jurisdiction of the cantons, there are significant variations in notary fees as well as the process of property transfer from one canton to another. The most important distinction is the one between cantons with official notaries ("Amtsnotar" or "notariat d’État/notariat officiel") and those without:
- In cantons without public notaries, notaries (who are licensed by the canton) operate as independent service providers. To have your property transfer notarized and, if desired, to draft the purchase agreement, you may choose a notary of your preference. In almost all cases, the notary must be based in the canton where the property is located.
- In cantons with official notaries, notaries are employees the canton and, therefore, public servants. In most cases, you won't be able to choose the notary.
- In cantons with a mixed notarial system, there are both public notaries and independent notaries, each with jurisdiction over specific areas of expertise.
For all inquiries related to notarial services in your canton, you should reach out to your local Neho real estate agent. With his or her experience from numerous property sales, he or she is well-versed in the specific regulations of your canton and can guide you through the property transfer process with confidence.
Land Registry fees
To complete a property transfer, the new owner of the property must be entered into the land registry. Land registry offices charge a fee for this service. In most cantons, this fee amounts to between 0.1% and 0.2% of the purchase price. Usually, the land registry fees are divided equally between the parties involved.
Please note that the 0.1% to 0.2% mentioned here are specifically fees for the land registry entry. In cantons where the land registry office also acts as a public notary by authenticating the purchase agreement, additional fees may apply for these services.
Other costs
Most banks charge a prepayment penalty or fee when redeeming your mortgage prematurely. This fee is calculated based on the mortgage amount, the interest rate, and the remaining term. Exiting a long-term fixed-rate mortgage can quickly become very expensive (e.g. over ten thousand Swiss francs per remaining year).
If you do not want to pay off the mortgage prematurely, the buyer may be willing to assume the existing mortgage under the same terms. Alternatively, you can transfer the mortgage to the new property if you are buying another property concurrently with the sale.
Additional costs are incurred for the creation of an energy performance certificate (GEAK/CECB). However, it is not mandatory in all cantons.
Brokerage commission and advertising
If you engage a real estate agent to sell your property, as the client, you will naturally be responsible for the associated costs. In addition to the brokerage commission or fee, typically around 3% of the selling price, the agent may pass on additional expenses, such as travel expenses or advertising costs, to you. With a traditional real estate agent, these costs can quickly add up to 30000 to 50000 Swiss francs.
At Neho, we do not charge a brokerage commission but instead a fixed fee of CHF 12000, independent of the property's value. The costs for photography, virtual tours, and advertising are included in this price!
