Germany–Switzerland
Topic 05Real Estate Between Germany and Switzerland
Cross-border property questions commonly arise when a German resident acquires or owns real estate in Switzerland, or retains German property after moving to Switzerland. The main issues are purchase, use, letting, financing, sale and treaty treatment of directly owned real estate.
Overview
Assessing Direct Property Investments Across Borders
For property involving Germany and Switzerland, the starting points are where the property is located, who owns it and how it is used.
The country in which real estate is located has a particularly important role in its taxation. The owner’s country of residence may also take tax consequences into account. Swiss and German treatment therefore needs to be coordinated.
This section focuses on direct ownership of land and real estate. Where a company, a real estate fund or tax residence becomes the main issue, the assessment continues in the relevant specialist section.
This Topic from the Swiss Perspective
TaxRep Switzerland covers German real estate owned by Swiss residents, letting, financing, sales and the Swiss tax consequences of cross-border property ownership.
Approach
Four Stages of the Property Assessment
Property Location
Is the property located in Germany or Switzerland?
Owner & Use
Individual or company? Personal use, holiday home or rental property?
Local Taxation
Which ongoing taxes and tax consequences of a sale arise in the country where the property is located?
Treaty & Country of Residence
How does the other country treat the income, taxes and capital gains?
Property Ownership and Tax Residence Require Separate Assessment
A holiday home or second home may also raise questions about domestic residence and treaty residence. The residence assessment is covered in Residence & Relocation .
Use & Ownership Lifecycle
Buying, Using, Letting, Financing and Selling
Buying a Property
Eligibility under Lex Koller, the ownership structure, financing, purchase agreement and land register need to be coordinated before acquisition.
Personal Use or a Holiday Home
Acquisition restrictions, actual use and possible effects on domestic and treaty residence need to be assessed separately.
Swiss Rental Property
Rental income, interest expenses, maintenance, losses, Swiss tax and German treatment need to be analysed together.
Financing
A Swiss mortgage, German financing, CHF/EUR currency risk and the tax allocation of financing costs can influence the structure.
Selling
Swiss real estate capital gains tax, German residence and the treaty treatment of the sale need to be coordinated.
German Property After Departure
Retaining German real estate may result in continuing German tax consequences after moving to Switzerland.
Situations
Typical Germany–Switzerland Property Situations
These situation pages bring together the tax and legal questions relevant to each practical cross-border scenario. Individual questions are explored in greater detail in the articles below.
Swiss Real Estate Owned by a German Resident
For German tax residents acquiring, owning, using, letting or subsequently selling property in Switzerland.
Explore situationSwiss Holiday Home Owned by a German Resident
A holiday home or second home involving purchase eligibility, personal use, occasional letting and possible effects on domestic and treaty residence.
Explore situationGerman Real Estate After Moving to Switzerland
German property retained after relocating to Switzerland: personal use or letting, German tax liability and treaty consequences.
Explore situationTax Articles
Five Key Articles on Swiss Real Estate
These articles follow the typical ownership lifecycle of Swiss real estate held by a German resident: checking purchase eligibility, completing the acquisition, arranging financing, assessing rental taxation and coordinating the sale.
Buying Swiss Real Estate as a German Buyer
When is a German buyer considered a person abroad? Which properties require authorisation, and which exceptions apply to holiday homes, cross-border commuters or properties used for business operations?
Explore Lex KollerThe Swiss Property Purchase Process
Property due diligence, purchase eligibility, financing, the notarised purchase agreement, land registration, acquisition costs and tax preparation.
Explore the purchase processFinancing Swiss Real Estate from Germany
A Swiss mortgage or financing from Germany, CHF/EUR currency risk, collateral, equity and the tax allocation of financing costs.
Explore financingSwiss Rental Property Owned by a German Resident
Rental income, income calculation under German law, Swiss tax, treaty tax credits, interest expenses, maintenance costs and restrictions on loss deductions.
Explore rental taxationSelling Swiss Real Estate as a German Resident
Swiss real estate capital gains tax, German residence, the gain on sale and cross-border treaty treatment.
Explore property salesRental Income, Interest Expenses and Maintenance Costs
The tax treatment of interest expenses, maintenance costs, rental income and losses is explained together in Swiss Rental Property Owned by a German Resident . This allows the income and related expenses to be assessed as part of the overall rental situation.
Ownership Structures
Personal Ownership, a German GmbH or a Swiss Company?
Where the company structure becomes the main issue, the assessment extends beyond the property itself to business and shareholder taxation.
Comparing Corporate Ownership Structures
Comparing direct ownership by a German GmbH with ownership through a Swiss AG or GmbH involves corporate income tax, income from shareholdings, distributions, the German Foreign Tax Act (AStG), financing and the eventual exit structure.
- A German GmbH as the direct property owner
- A Swiss AG or GmbH as the property holding company
- Section 8b KStG and taxation of shareholdings
- Swiss withholding tax
- Controlled foreign company rules under the AStG
- Asset deals and share deals
Comparing Structures in the Business Section
The article German GmbH or Swiss AG for Swiss Real Estate? explains the comparison in greater detail within Businesses & Shareholdings .
Germany–Switzerland Tax Advice
Do You Own or Plan to Acquire Property Involving Germany and Switzerland?
We assess acquisition, use, letting, financing, sales and cross-border treaty treatment, together with the effects of moving between Germany and Switzerland.
Have Your Property Situation Reviewed