Jurisdiction
In the canton of Vaud, real estate gains tax is levied by the cantonal authorities who then pay the five twelfths to the commune where the property is located. If the property is located in more than one commune, then the share of the tax is distributed in proportion to the taxable gain in each commune.
Tax rate
The tax rate in the canton of Vaud is proportional, which means that each gain is taxed at the same rate, regardless of its amount. The length of ownership of the property is nevertheless taken into account in the calculation.
Holding period
As previously indicated, the years of ownership of the property are taken into account in the calculation of the tax rate in the canton of Vaud. A sliding scale of rates is applied. This means that the maximum tax rate is 30% for a period of ownership of less than one year. This is reduced year by year to reach the minimum rate of 7% after 24 years of ownership of the proceeds of the alienation.
It is also important to note that the years of occupation of the property by the seller him- or herself can be proven to count double in the calculation of the period of ownership.
Taxation mode - Monistic or dualistic system
In the canton of Vaud, the real estate gains tax is a one-off tax that is not part of the income tax but must be paid upon transfer only for gains from private assets. In all other cases, the tax is levied in the same way as income or profit tax.
Thus, only the profits from assets held as part of private assets are subject to a special tax, independent of the ordinary tax. In the case of property that is part of a business estate, the tax on real estate gains is part of the ordinary income tax. If the profits are derived from a business operation, they are subject to profit tax (dualistic system).
Minimum amount
Gains of less than CHF 5’000 are exempt from tax. Real estate gains tax is applied when the gains are equal to or greater than CHF 5'001.
Basics and useful links
You will find here the corresponding legal texts: Extracts from the law of 4 July 2000 on cantonal taxes
This link allows you to fill in the declaration for the taxation of real estate gains.
All the indications in this article are provided for information purposes only. We invite you to contact the competent authorities or an advisor for a personalised recommendation.
General information on the Swiss property gains tax can be found here.
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