Federal tax benefits for second homes are disappearing: what does this mean for you?

1) What disappears as of assessment year 2026?

Up to and including assessment year 2025, you could deduct the interest on a loan for a non‑primary residence from your taxable real estate income.
As of assessment year 2026, this interest deduction disappears entirely, both for new and existing loans.

In concrete terms, this means that interest on a loan for a second home or a property you rent out no longer provides a tax benefit.

The circular also confirms that the following advantages will no longer apply:

• Federal tax reduction for green loans
• Federal tax reduction for additional interest
• Federal tax reduction for construction savings
• Federal “woonbonus” (tax reduction for the sole primary residence)

However, the 1.5% interest bonus for green loans remains applicable.

2) What is still possible?

For real estate income, only the fees related to emphyteusis and superficies rights can still be deducted.
In addition, in certain situations, capital repayments and related premiums that previously fell under construction savings may still qualify for the federal tax reduction for long‑term savings.

Note:

• this depends on your personal situation,
• and on other ongoing savings schemes.

Individual advice therefore remains essential to determine whether you can still benefit from any tax reduction.

3) What does this mean for you in practice?

The elimination of the interest deduction for non‑primary residences will, in many cases, lead to a higher tax burden.
The interest can no longer be deducted from taxable real estate income, resulting in more personal income tax owed.

Do you rent out a property? Then it becomes even more important to critically assess your rental income and overall return.
The disappearance of the tax benefit can have a noticeable impact on the net result of your real estate investment.

Even those who maintain a second residence for personal use should take into account a less favourable tax treatment.

4) Conclusion

Federal real estate taxation is clearly becoming stricter for private investors.
As of assessment year 2026, the interest deduction and almost all federal tax benefits for non‑primary residences will disappear, regardless of whether the loan is new or existing.

As a result, real estate returns will depend less on tax incentives and more on actual income.
In many cases, a revision of financial and tax planning is advisable to avoid unpleasant surprises in the tax return.

Our PKF BOFIDI experts are here to support you

Our experts are happy to look with you at what these changes mean for your specific situation and how you can best respond.
Feel free to contact us. Our PKF BOFIDI experts are ready to assist you.

This article was written by Sofie Andries.