Deductibility of contributions to a renovation fund as property costs for direct federal tax and state and municipal taxes

Facts

The appellants, spouses [B.A.] and [A.A.] , claimed a deduction for property costs in the amount of CHF 9,583.-- in their tax return for the 2013 tax period. The cantonal tax authority did not allow the effective property costs, which were paid through the renovation fund, with the reasoning that the contributions could be claimed when paid into the renovation fund and not when paid out of the renovation fund.

The appellants requested that the judgment of the Administrative Court of the Canton of Zurich of July 3, 2015, be set aside and that the deductions from the self-occupancy value for the repair costs paid through the repair fund, which they had claimed in their tax returns for state, municipal, and federal taxes 2013, be recognized.

Considerations

The Federal Court has admitted the appeal in public law matters and examines whether the lower court applied the statutory provision of Art. 1 para. 1 lit. a no. 2 of the FTA Property Costs Ordinance in accordance with the statutory provisions on the periodicity of taxation.

The Federal Court comes to the conclusion that the lower court applied the statutory provision correctly and that the appellants have no claims to equal treatment in the wrong. The lower court also applied the statutory provisions on the periodicity of taxation correctly, in that it only allowed the contributions made to the renovation fund during the relevant tax…