Anyone in Switzerland who lives in their own house or owner-occupied flat has no rental costs, so they save money a tenant would have to spend on rent. The legislator treats this housing benefit as income and taxes it: the imputed rental value. It is added to other taxable income and thereby raises income tax.
How it is determined: the cantonal tax authority sets the imputed rental value based on location, size, fit-out standard, and age of the property. As a rule it is below the actual market rent, often in the region of about 60–70 % of a comparable rent, although the methods vary from canton to canton. Once set, the value is declared each year as income on the tax return.
The counterpart, deductions: as an offset, owners may deduct certain costs from income, in particular mortgage interest (debt interest) and value-preserving maintenance costs (repairs, replacement, upkeep, but not value-adding investments in the year they occur, except energy-saving measures). With a low mortgage and little maintenance the imputed rental value can raise the tax burden; with a high mortgage and a lot of maintenance the net result can even be an advantage.
Important note on the system change: abolishing the imputed rental value has been politically contested for years and was the subject of a federal proposal. Whether and from when today's system will be replaced by a new one (without imputed rental value, but also with restricted deductions) should be checked case by case against the current status. Until a definitive changeover, the existing system continues to apply.
A fiduciary or financial advisor helps declare the imputed rental value and deductible costs correctly, plan the optimal handling of the mortgage (amortisation vs. interest deduction), and time maintenance work in a tax-smart way. A single franc figure cannot be given, as it depends heavily on the property and canton (no guarantee).