Lump-sum taxation in Switzerland: 2026 amounts and what they mean for buying a property

By Stanislas Roux, founder of OFFER

In two sentences: taxation according to expenditure — known as lump-sum taxation — allows a foreign national who settles in Switzerland without working there to be taxed on their cost of living rather than on their income. In 2026, the minimum tax base is CHF 435'000 for direct federal tax, and it cannot be lower than seven times the rent or the imputed rental value of the home: the choice of residence therefore sets a floor for the tax.

Who can use it

Article 14 of the Federal Act on Direct Federal Taxation (DFTA, French text) sets three cumulative conditions: not holding Swiss nationality; becoming subject to unlimited tax liability in Switzerland for the first time or after an absence of at least ten years; and not pursuing any gainful activity in Switzerland. For a married couple living in the same household, both spouses must meet these conditions.

It is not a universal regime. Several cantons have abolished it — Zurich in 2009, then notably Appenzell Ausserrhoden, both Basel cantons and Schaffhausen, as an interpellation in the Vaud Grand Council recalled in 2020; the Council of State then stated that 23 cantons applied it. It exists in Geneva, in the canton of Vaud and in Valais, each with its own cantonal minimums.

How the tax base is calculated

The tax is calculated on the annual expenditure of the taxpayer and their dependants, in Switzerland and abroad, to maintain their standard of living — but at least on the highest of four amounts (art. 14 para. 3 DFTA):

• CHF 435'000 a year for the 2026 tax year (CHF 434'700 in 2025): the amount is adjusted every year to the Swiss consumer price index;
• for a head of household, seven times the annual rent or the imputed rental value of their home;
• for other taxpayers, three times the annual price of board and lodging;
• the total of certain gross income from Swiss sources: income from real estate located in Switzerland, from capital invested in Switzerland, Swiss pensions and annuities, and income for which a double taxation agreement is invoked, among others.

The tax is then calculated on this base at the ordinary rates.

The link with your future home: the seven-times rule

This is the point buyers often discover too late. For a head of household, the tax base cannot be lower than seven times the imputed rental value of the home they occupy. A purely arithmetical example: a property whose imputed rental value were set at CHF 90'000 a year leads to a tax base of at least CHF 630'000, well above the federal minimum of CHF 435'000. The larger the property, the higher the floor.

This link will survive the 2029 reform. The act abolishing the imputed rental value (French text) for owner-occupiers keeps, for lump-sum taxation, the reference to seven times the annual rent or the rental value determined according to local conditions. The choice of residence will therefore remain a factor in the tax discussion — hence the value of handling the choice of property and the exchange with the tax authority together, with a tax adviser, before the deed is signed.

2026 amounts in the cantons where we work

For third-country nationals, Geneva also publishes an example of an agreement based on the minimums applied for a “major fiscal interest”: CHF 750'000 for direct federal tax and CHF 825'000 for cantonal and communal tax (10% surcharge included) for 2021, indexed since, i.e. CHF 804'272 and CHF 871'759 in 2026 in this example.

To gauge the scale of the regime in the canton of Vaud: 963 taxpayers were taxed according to expenditure there on 1 January 2020, compared with 1'394 on 1 January 2012, according to the Council of State.

What lump-sum taxation does not cover

Lump-sum taxation replaces income tax and, depending on cantonal rules, serves as the basis for wealth tax. It does not exempt you from taxes linked to the property itself: transfer duties on purchase, depending on the canton, and property gains tax on resale — see our guides for Vaud and Valais (in French).

Nor does it settle the question of acquisition. For a foreign national, it is the Lex Koller that determines whether they may buy: an EU or EFTA national domiciled in Switzerland buys like a Swiss national; a third-country national domiciled in Switzerland may acquire their main residence. A second home is subject to stricter rules, and to the Lex Weber in the communes concerned.

How the process works

Lump-sum taxation is determined with the tax administration of the canton of residence, on the basis of a file that quantifies the cost of living and the intended residence; Valais, for example, designates a contact person for ruling requests on expenditure-based taxation. For a buyer, the logical order is: choice of canton, preliminary tax discussion, search for the property, then acquisition — not the other way round.

The properties these buyers look for — lakeside mansions, estates in Cologny or Terre Sainte, chalets in Verbier or Gstaad — rarely change hands through a listing. A confidential search mandate makes it possible to approach them without exposure, on both sides.

This article is an information summary, not tax advice. Conditions and amounts change every year; only the competent tax authority can confirm a tax base. Sources: art. 14 DFTA (SR 642.11, as at 1 January 2026) on Fedlex; Federal Tax Administration, circular letter 2-215-D-2025-f of 11 September 2025; Republic and Canton of Geneva, “Indexations des conventions d’imposition d’après la dépense” (update of 26 May 2026); Federal Tax Administration, Valais cantonal fact sheet (as at September 2025); Vaud Council of State, reply to interpellation 20_INT_434 (May 2020); Federal Act of 20 December 2024 (FF 2025 23). A French version of this guide is available: Forfait fiscal en Suisse romande.