In view of a recent energy shortage, we would like to install a photovoltaic system on our family home and combine it with a battery. The costs amount to CHF 45,000. What options do we have to make this investment? Can we use pension funds?
You are not alone with your concern to install a photovoltaic system. In our current dream home study, we were able to determine that a little more than half of the surveyed owners would like to make investments in their own home in the next two years and around a third of them want to install a solar system. With electricity production alone, it takes a few decades at current electricity prices for a photovoltaic system to be amortized. However, if you make the investment with pension funds and/or a mortgage increase and take into account the government subsidies and tax savings, the venture is not only worthwhile as a sustainable contribution to alleviating the energy crisis and for the environment, but also for your wallet.
Use pension funds and/or increase your mortgage?
You can withdraw pension funds, such as those from the pension fund and the third pillar, every five years – including for a photovoltaic system. Pension funds have various requirements for withdrawals for renovations. For example, a minimum early withdrawal may be specified, which is why it is advisable to clarify this in advance. You must also note that the withdrawal leads to a capital performance tax. In order to avoid this and at the same time claim higher mortgage interest expenses in the tax return, pledging with a simultaneous increase in the mortgage can be considered instead of withdrawal. The pension assets remain in the pension fund or in the third pillar and continue to earn tax-free interest.
Price increases create scope for mortgage increases
Investing in a photovoltaic system is also particularly attractive because it is considered a value-preserving investment for tax purposes and can be deducted, but at the same time increases the property value by the investment amount. The latter effect automatically results in a lower loan-to-value ratio and thus scope for an increase in the mortgage, provided that it is still affordable. Due to the general increase in real estate prices in recent years, it is very often the case that you do not need any pension funds to top up your mortgage.
Pay attention to subsidies and tax savings
With an investment of CHF 45,000, you should receive government subsidies of around CHF 5,000. You can also deduct the investment from your taxes, which should bring you a one-time tax saving of a similar amount. You have then already amortized a quarter of the investment costs. You can then easily make up for the slightly higher mortgage costs of around CHF 1,000 per year with higher tax deductions, the feed-in tariff for electricity you do not use yourself and the electricity costs saved.
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2023-07-03 05:00:14
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