Federal Direct Tax Law

As a result of the amendment, effective as of the 1st of January 2020, to article 32 paragraphs 2 and 2bis of the Federal Direct Tax Law (FDTL) and to article 9 paragraphs 3 and 3bis of the Federal Act on the Harmonization of Direct Taxes of the Cantons and Municipalities (THL) and to the corresponding cantonal laws, private property owners may now deduct from their taxable income, expenses related to the demolition of a building, when the purpose of the demolition is to replace it by a new construction. In addition, these demolition costs as well as energy saving and environmental investment costs can be carried forward to the next two tax periods, if they cannot be fully taken into account for tax purposes in the year in which they were incurred.