An inherited property is often the most valuable asset in an estate — and the most complicated. Between inheritance tax, usufruct and the community of heirs, there are numerous pitfalls. This guide explains your options and your tax obligations.
Inheritance Tax on Property
Inheritance tax in Switzerland is governed at cantonal level — and the differences are enormous:
| Heir | Most cantons | Special features |
|---|---|---|
| Spouse | Tax-free | Exempt in all cantons |
| Children (direct descendants) | Tax-free in most cantons | Exceptions: VD, NE, LU (reduced rates) |
| Siblings | 5–20% | Highly dependent on the canton |
| Non-relatives | 20–50% | Unmarried partners: often taxed as strangers |
Important: The tax value of the property (not the market value) is decisive — and this is often 20–40% below the market value.
The 5 Options After the Inheritance
Option 1: Use the property yourself
- The imputed rental value is added to your taxable income
- Mortgage interest and maintenance costs are deductible
- No property gains tax (no sale)
- Co-heirs must be bought out
Option 2: Rent it out
- Rental income is taxable
- Maintenance costs, mortgage interest and management costs are deductible
- Check the yield (→ Yield calculator)
- Factor in the management effort
Option 3: Sell
- Property gains tax is due — the deceased's holding period is credited
- The deceased's investment costs can be deducted
- Off-market sale recommended for discretion (→ Selling discreetly)
Option 4: Transfer to co-heirs
- Internal allocation within the estate division
- No property transfer tax (division under inheritance law)
- The valuation must be fair to all co-heirs
Option 5: Grant a usufruct
- The surviving spouse uses the property while the children are the owners
- The usufructuary bears the maintenance costs
- The imputed rental value is attributed to the usufructuary
- Sale only with the consent of all parties
Community of Heirs: When Several People Inherit
When several people inherit a property, they form a community of heirs. This can only act unanimously — a frequent source of conflict:
- Any co-heir may demand the division of the estate at any time (Art. 604 Swiss Civil Code)
- Agreement on value and allocation is required
- In case of disagreement: the court orders a sale
- Bring in a mediator or a neutral appraiser early on
Tax Optimisation for Inherited Property
- Credit the holding period: For the property gains tax, the deceased's holding period counts — the longer it is, the lower the tax on a sale
- Document renovations: The deceased's value-enhancing investments can be deducted as investment costs when selling
- Tax value vs. market value: Inheritance tax is based on the lower tax value — advantageous
- Staggering: Spread renovations after the inheritance across several years for tax purposes
An inherited property — what now?
We advise you discreetly and personally on your options — valuation, sale or letting.
Request a consultation→ In-depth guide: Selling an inherited property: 7 steps
→ Tax calculator: Calculate property gains tax
As of April 2026. Not legal or tax advice — please consult a specialist in inheritance law.