How does property transfer tax work in Valais?
- How does property transfer tax work in Valais?
- How much is property transfer tax in Valais, really?
- When and how is property transfer tax paid?
- Transfer tax, notary and land registry: what costs should you expect?
- Exemptions, off-plan purchases and existing mortgage notes: special cases
- Transfer tax and property gains tax: what is the connection?
Planning to buy an apartment, house or chalet in Valais? Property transfer tax is an additional expense to budget for alongside your equity and mortgage. Contrary to a common assumption, the applicable rate does not depend solely on the municipality: a cantonal rate schedule based on the value of the transaction applies first, and a municipal surcharge may then be added.
How much should you budget for a property costing CHF 500’000, CHF 800’000 or CHF 1.2 million? Why can two municipalities charge different amounts? And how much does it actually cost to establish a new mortgage note? Here are the rules in Valais, original calculations and the checks to make before signing. Rules and examples concern ordinary transactions without exemptions.
How does property transfer tax work in Valais?
Property transfer tax is levied when ownership of a property is transferred. In Valais, the Act on Property Transfer Taxes (LDM) provides for a cantonal tax and allows municipalities to levy an additional tax. A residential property sale is the most common case, but the law also covers other transactions, including exchanges, certain gifts and transfers of the economic ownership of real estate, subject to statutory exemptions.
A distinctive feature of Valais: the canton sets the rates and municipalities may add a surcharge
The canton applies the rates set out in Article 14 LDM to the taxable value. Under Article 15, the municipal surcharge cannot exceed 50% of the cantonal tax. For example, a cantonal tax of CHF 10’400 can therefore be increased by no more than CHF 5’200. A municipality cannot simply set an unlimited overall tax rate.
A real-world comparison illustrates this: the official table of municipal supplementary rates published by the Land Registry Service shows 50% in Sion, Sierre and Martigny, 40% in Bürchen and 30% in Vernayaz. These percentages apply to the amount of cantonal tax, not directly to the purchase price. Ask your notary to confirm the rate in force in the relevant municipality when the deed is registered.
The taxable basis: not necessarily just the advertised price
For an ordinary sale, Article 11 LDM uses the consideration given for the acquisition: the price paid and, where applicable, any other obligations assumed by the buyer in exchange for the property. Unless there is evidence to the contrary, the taxable basis is at least the cadastral value. An artificially low sale price therefore does not automatically reduce the transfer tax.
Before signing the deed of sale, ask your notary which value will actually be used, particularly if the transaction involves the assumption of debt, additional consideration, an off-plan purchase or a sale within the family.
Who is legally liable for property transfer tax?
The buyer is the taxpayer under Article 10 LDM, and the buyer and seller are jointly and severally liable for payment. The parties may agree on a different contractual allocation of costs, but this does not remove the statutory liability. Buyers should therefore include these amounts in their budget unless there is a clearly documented arrangement approved by their notary.
How much is property transfer tax in Valais, really?
First, identify the value bracket in Article 14 LDM. This is not a marginal tax schedule: the rate for the relevant bracket applies to the transaction’s entire taxable value, not only to the amount above the threshold.
| Taxable value | Cantonal tax | With a 50% municipal surcharge |
|---|---|---|
| Up to CHF 1’000 | Exempt from proportional tax (Art. 18) | — |
| CHF 1’001 to 50’000 | CHF 20 | CHF 30 |
| CHF 50’001 to 500’000 | 1.0 % | 1.5 % |
| CHF 500’001 to 1’000’000 | 1.3 % | 1.95 % |
| From CHF 1’000’001 | 1.5 % | 2.25 % |
Mind the thresholds: for a taxable value of CHF 500’000, cantonal tax is CHF 5’000; at CHF 500’100 it rises to CHF 6’501.30 (1.3% of CHF 500’100). The difference results from moving into a new tax bracket, not from a surcharge applied only to the extra CHF 100. The CHF 1 million threshold deserves the same attention. Factor this into your calculations without artificially understating the price.
Comparative calculations: three purchase prices
Original calculations by pretimmobilier.ch — for ordinary sales where the taxable value equals the purchase price, in a municipality applying a 50% surcharge. The figures below cover transfer tax only, excluding notary and land registry costs.
| Purchase price | Cantonal tax | Municipal surcharge (50%) | Total transfer tax |
|---|---|---|---|
| CHF 500’000 | CHF 5’000 | CHF 2’500 | CHF 7’500 |
| CHF 800’000 | CHF 10’400 | CHF 5’200 | CHF 15’600 |
| CHF 1’200’000 | CHF 18’000 | CHF 9’000 | CHF 27’000 |
Sion versus Vernayaz: a CHF 2’080 difference on a CHF 800’000 purchase
On a property costing CHF 800’000, cantonal tax is CHF 10’400 in either location. The municipal surcharges in the official table produce different totals:
| Municipality | Surcharge on cantonal tax | Municipal tax | Total transfer tax |
|---|---|---|---|
| Sion (50%) | 50 % | CHF 5’200 | CHF 15’600 |
| Vernayaz (30%) | 30 % | CHF 3’120 | CHF 13’520 |
Difference: CHF 2’080. This does not mean you should choose a municipality purely for tax reasons: property prices, transport, ongoing costs and financing are more important. It does show why a calculator that applies a blanket “1.5% in Valais” may underestimate or incorrectly break down acquisition costs. Always check the municipal rate applicable when the deed is executed.
When and how is property transfer tax paid?
It is important to distinguish three events: signing the notarised deed, its processing by the land registry and the point at which the tax becomes payable. All three are part of the same transaction, but they do not necessarily happen on the same date.
The notary’s role and advance payment of costs
The notary prepares the deed, coordinates documents and financing, and arranges the land registry formalities. In practice, the notary usually requests an advance payment to cover taxes, registry fees and notarial services. This helps secure the transaction; it does not necessarily mean that the tax has already become legally due.
Under Article 29 LDM, the tax becomes due when the tax assessment decision is notified and must be paid within 30 days. It would therefore be incorrect to say that transfer tax must always be definitively paid before the land registry entry. Your notary can explain how advance payments and final settlement will be handled in your case.
What to ask before you sign
Request a detailed provisional cost breakdown showing cantonal tax, municipal surcharge, land registry fees, notarial fees or charges, any new or transferred mortgage note, administrative costs and VAT where applicable as separate items. Also ask which amounts are advances and which are final charges.
Transfer tax, notary and land registry: what costs should you expect?
The catch-all expression “notary fees” can hide several charges with different legal bases and recipients. A precise budget should distinguish the costs of acquiring ownership from those of financing the purchase.
1. Transfer tax: cantonal tax and any municipal surcharge
This is the tax on the transfer of ownership, calculated using the cantonal schedule and the municipal surcharge. It is not remuneration for the notary. For an ordinary CHF 800’000 transaction in Sion, we calculated CHF 15’600 in property transfer tax.
2. Land registry: registering the new owner
Article 32 of the cantonal Land Registry Ordinance (OcRF) generally sets the proportional fee for registering ownership at 2 ‰ (0.2 %) of the reference value, subject to a minimum of CHF 100 and a maximum of CHF 5’000. On CHF 800’000, the fee is CHF 1’600, excluding any additional transactions.
3. The notary: a regulated fee schedule, not a universal percentage
Notarial services are governed by the cantonal regulation on notarial fees and expenses. Costs depend on factors such as the value and type of deed, whether a property security interest must be established, additional formalities and any available fee reductions. Quoting “0.5% to 0.7% of the price” as a universal rule for every sale would be misleading. Request an individual estimate; our guide to notary fees provides further details.
4. Mortgage security: two costs buyers often overlook
If the financing requires the creation of a new registered mortgage note, two separate charges arise:
- Tax on establishing the mortgage security: generally 0.2% of the secured amount from CHF 20’001 upwards (Art. 16 LDM).
- Fee for registering the registered mortgage note: 1‰ (0.1%) of the reference amount, with a minimum of CHF 100 and a maximum of CHF 2’500 (Art. 32 OcRF). A paper mortgage note is subject to a different fee schedule.
The secured amount is not necessarily the same as the outstanding mortgage loan. An existing mortgage note may also be transferred or amended, affecting which transactions are taxable and what fees apply. Before budgeting for a new note, ask your lender and notary to confirm the amount to be secured and how any existing note will be handled.
Original budget calculation: CHF 800’000 purchase with 80% financing
Assumptions: ordinary purchase in Sion (50% municipal surcharge), taxable value CHF 800’000, buyer equity CHF 160’000, mortgage CHF 640’000 and a new registered mortgage note for CHF 640’000. No existing security is transferred. The statutory charges below are calculated separately, excluding notarial fees and other incidental costs.
| Item | Calculation | Amount |
|---|---|---|
| Cantonal transfer tax | CHF 800’000 × 1.3 % | CHF 10’400 |
| Municipal surcharge | CHF 10’400 × 50 % | CHF 5’200 |
| Registration of ownership | CHF 800’000 × 0.2 % | CHF 1’600 |
| Tax on the new mortgage security | CHF 640’000 × 0.2 % | CHF 1’280 |
| Registration of the mortgage note | CHF 640’000 × 0.1 % | CHF 640 |
| Total of these five items | — | CHF 19’120 |
Including the CHF 160’000 of equity, the buyer must therefore budget at least CHF 179’120 before notarial fees and other excluded costs, subject to the financing terms accepted by the lender. Acquisition costs are not automatically covered by an 80% mortgage. This calculation is designed to separate individual charges, not to replace a notary’s final statement.
These acquisition costs are additional to the equity required to purchase the property and should be included in the financing plan. To understand how lenders assess the property’s value, the required equity and mortgage affordability, read our guide to mortgage financing in Valais.
In Vernayaz, keeping the same assumptions and using the 30% municipal surcharge in the official table, the total for these five items would be CHF 17’040, or CHF 2’080 less. Only the municipal portion of transfer tax changes in this comparison.
Exemptions, off-plan purchases and existing mortgage notes: special cases
Buying off-plan or turnkey: check the taxable basis
Article 11 LDM expressly provides that when a building or condominium unit is sold turnkey, or where the sale is linked to a construction contract equivalent to a turnkey purchase, tax is assessed on the total price of the land and construction. Do not assume that a separate contract for the land automatically limits the tax to the land value. Have the full contractual arrangement reviewed before signing.
Transfers between parents and children, spouses or registered partners
Under Article 18 LDM, transfers in a direct line of descent and between spouses or registered partners benefit from an exemption from proportional tax, including the situations specified in that article involving the division of matrimonial property or dissolution of a registered partnership. This does not cover every family member automatically: siblings, cousins and other relatives are not treated as direct-line relatives.
An exemption from proportional tax does not mean the transaction has no costs or other tax consequences. Fees, fixed charges and separate inheritance or tax implications may still arise. Ask a notary to check the precise nature of the transfer.
Reusing an existing mortgage note: a possible saving
Before agreeing to establish a new mortgage note, check whether the property already has suitable security and whether the lender will accept its transfer. A change of creditor, conversion, increase in the secured amount or establishment of new security do not have the same tax or fee consequences. Reusing a note can reduce certain costs, but it does not guarantee an automatic exemption: the amount and any necessary changes must be verified.
Checklist before signing the deed
- Ask for written confirmation of the taxable value used and the applicable bracket under Article 14 LDM.
- Check the current municipal surcharge: the official table is a starting point, not a guarantee for future transactions.
- Request a detailed notarial cost statement covering taxes, registration of ownership, notarial services and any mortgage security.
- Check whether an existing mortgage note can be reused and how much security the lender requires.
- For an off-plan purchase, a family transfer or a transaction involving the assumption of debt, have the special tax rules confirmed before entering into an irrevocable commitment.
Transfer tax and property gains tax: what is the connection?
Transfer tax is paid when the property is acquired, whereas tax on a property gain applies to a profitable resale. These are separate taxes. However, certain acquisition costs may be relevant when calculating the taxable gain on a subsequent sale.
Keep evidence of transaction costs and capital improvements
The official Valais guidance on declaring property gains allows certain costs of the acquisition deed, including some security-related expenses, to be taken into account where the relevant requirements are met. It also distinguishes lasting improvements that increase a property’s value from maintenance and repairs, which are not necessarily deductible in the same way.
Keep the purchase deed, tax statements, land registry invoices, notary receipts and supporting documentation for building work. Do not assume that every renovation is deductible when calculating a property gain: the nature of the work, its previous tax treatment and the available evidence all matter.
Simplified example: reducing taxable gains does not mean reducing the tax rate
Suppose you purchase a property for CHF 500’000 and sell it a few years later for CHF 580’000. The gross difference is CHF 80’000. If CHF 12’000 of acquisition costs and investments are actually accepted in the calculation, the gain in this simplified example falls to CHF 68’000 before any other adjustments. This is not an automatic CHF 12’000 reduction in the tax payable: it reduces the basis on which the tax is calculated.
The property gains tax rate depends, among other things, on the taxable gain and the holding period, under the schedule in force at the time of sale. For a reliable estimate, obtain a calculation based on your circumstances rather than relying on a single percentage without context.
Official sources to consult for your transaction
- Valais Act on Property Transfer Taxes (LDM, RS 643.1): tax liability, taxable basis, rates, exemptions and payment dates.
- Land Registry Service: municipal supplementary rates: differences between municipalities.
- Cantonal Land Registry Ordinance (OcRF, RS 211.611): fees for registrations and mortgage notes.
- Regulation on Notarial Fees and Expenses (RS 178.104): notarial fee schedule.
- Cantonal guidance on declaring property gains: eligible costs and investments.
General information based on official sources. Rates and municipal surcharges may change, and exemptions and additional costs depend on the transaction. This article is no substitute for a notary’s cost calculation or personalised tax advice.
