Property gains tax in the canton of Bern: rates and tips

1. Who is liable to pay property gains tax?

If you make a profit on the sale of a property, you owe the respective canton property gains tax. The profit on the property is the difference between the proceeds collected and the costs incurred for the property

These costs are also referred to as investment costs. These include:

• The purchase price at the time

• Expenses for notary fees and land registry fees

• Estate agent costs

• Value-enhancing investments

• Other costs related to the sale of the property

The amount of the property gains tax depends on how the property is used, how long it was held and the amount of profit generated from the sale.

To determine the property gains tax, the basic tax rate is multiplied by the applicable tax rate.

Example calculation of property gains tax in the canton of Bern

The calculation is based on a purchase of a property in the city of Bern on 1 March 2007 and a sale on 1 March 2022. The property was therefore owned by the seller for 15 years.

Sale price of the property       CHF 650,000  on 1 March 2022

– Purchase price of the property      CHF 500,000  on 1 March 2007

– Capital expenses             CHF 12,000   Investments/renovations,      listing costs

Profit on the property           CHF 138,000

– Deduction for the duration of ownership (30% for 15 years) CHF 41,400

Taxable profit on the property     CHF 96,600

For the first CHF 2,700   1.44% = CHF 38.90    (1.44% of CHF 2,700)

For the next CHF 2,700   2.40% = CHF 64.80   (2.40% of CHF 2,700)

For the next CHF 7,900   4.08% = CHF 322.30   (4.08% of CHF 7,900)

For the next CHF 13,000   4.92% = CHF 639.60   (4.92% of CHF 13,000)

For the next CHF 26,100   6.41% = CHF 1,673.00   (6.41% of CHF 26,100)

For the next CHF 78,100   7.26% = CHF 3,208.90  (7.26% of CHF 44,200)

For the next CHF 195,300     7.81% = CHF 0

For further profits        8.10% = CHF 0

Basic tax            CHF 5,947.50

× 3.025 (cantonal tax rate)        CHF 17,991.30

× 1.54 (communal tax rate)       CHF 9,159.20

Total cantonal and communal tax:   CHF 27,150.50

Tip: the tax authority of the Canton of Bern provides an online calculation tool for property gains tax.

3. How can I reduce property gains tax in the canton of Bern?

There’s no way to avoid tax being charged on the sale of your property. However, it can be deferred if, for example, you buy another property with the proceeds of the sale. The tax can also be deferred in the case of donations or changes to matrimonial property regimes.

There are, however, ways to reduce property gains tax in the canton of Bern. You have several options to do this:

Claiming all deductions

As a general rule, the longer the property was owned, the lower the tax. Remember to claim all possible deductions. These include any value-enhancing investments such as renovations, estate agent commission, the costs of advertising the property, property transfer taxes, notary fees and early repayment charges paid to the bank.

Tip: when you buy a property, you should create a list containing the purchase price, investments and maintenance costs. Here you should list all expenses related to the property, including the date and amount. This allows you to check what deductions you can claim before selling. If you consult a professional tax advisor, they can determine the optimum solution for you based on the complete documents.

Deferring property gains tax

Under certain circumstances, you can defer property gains tax in the canton of Bern. This is the case with property transfers. Tax-deferring property transfers include:

• Change of ownership through inheritance (succession, division of inheritance and bequests), inheritance advances or gifts

• Change of ownership between spouses in connection with matrimonial property law

• Land apportionment and similar events

• Replacement purchase for agriculture/improvement of agricultural or forestry land

• Buying a new home

• Restructuring

• Replacement purchase of business-critical fixed assets

Please note that both the sale of the property and the replacement purchase must be carried out by the same person for there to be a deferment. In order to have the effect of deferral, you may make the replacement purchase in Bern up to a maximum of two years after the sale.

You can find more forms, information sheets and details about property gains tax in the canton of Bern on the cantonal website (not available in English).