Your car in your tax return: what it's worth, and why

For most people the car is the most valuable thing they own after their home, so it is natural to wonder how it lands in the tax return. The good news: in tax terms a private car is usually worth far less than you think, and it rarely moves your bill by much. Here is how it works in Zurich and Aargau, and what changes when you buy used, buy out a lease, or own a classic.

Your car is wealth, but at today's value

A privately owned car is part of your taxable wealth (Vermögen), alongside your bank balances and securities. What matters is not the price you once paid but what the car is worth now, and that figure falls every year.

Think of it like the trade-in value at a garage: nobody offers you the new price for a three-year-old car. The tax office uses the same idea. It starts from a base price and writes the value down each year, so the amount that reaches your wealth tax shrinks as the car ages.

How the value is worked out (Zurich vs Aargau)

The two cantons get to a similar place by different routes. The percentages below are guide figures for the current method. Rates and tables are reviewed periodically, so it is worth confirming the current values in your cantonal guide (the Wegleitung).

Zurich (Wegleitung §39) uses a declining balance: each year the car keeps about 60 % of the previous year's value, so it loses roughly 40 % a year, starting from the price you paid. Aargau (Wegleitung §28) takes a fixed percentage of the catalog (list) price based on the car's age since first registration.

Worth checking: these percentages are the ZH and AG methods and are guide figures. Other cantons use their own rules, and the exact tables can change, so verify the current figures with your cantonal tax office before relying on them.

A worked example

Say you buy a new car in Zurich for CHF 30'000, first registered in 2023. For the 2025 tax year the car is two years old, so its tax value is:

CHF 30'000 × 0.6² = CHF 10'800

That CHF 10'800 is added to your taxable wealth for the year. Because wealth tax rates in Switzerland are low and depend on your canton, your municipality and your total wealth, the actual tax on a car like this is typically a handful of francs to a few tens of francs, not a meaningful sum. The figures here are guide amounts; your own canton and year decide the exact result.

Buying a used car

A used car follows the same logic. You declare what you actually paid, not the original showroom price, and the value keeps falling each year from there. An older second-hand car therefore enters your wealth at a modest figure and shrinks further over time. What the tax office wants to know is straightforward: the price and the year the car was first put on the road.

Leasing, and buying the car at the end

While you lease, the car is not yours on paper. It belongs to the leasing company, so it does not appear in your wealth at all, and the lease payments on a privately used car are not a deduction.

That changes the day you pay the residual value and become the owner. From that point the car is your asset and is declared like any other car you bought: from the price you paid for the buyout, written down each year as it ages.

A car bought on a loan

If you financed the car with a loan rather than a lease, the picture is different again. You own the car, so it is declared at its tax value. But the outstanding loan is a debt (Schulden), and debts are subtracted from your wealth, with the loan interest deductible from your income. So a financed car adds its tax value on one side and removes the loan balance on the other.

Classic cars are the exception

The yearly write-down means an ordinary 15-year-old car is worth almost nothing for tax. A classic or collector car (an Oldtimer) breaks that pattern, because instead of falling to zero its market value can be high and may even rise. A car like that is worth its real market value, and that is the figure that belongs in your wealth, not the near-zero a depreciation table would suggest. If you own a valuable classic, it is worth checking with your tax office how they would like it valued, and keeping evidence of a realistic market value.

Where TaxWize helps

You enter the price and the year your car was first registered, and TaxWize works out the tax value for your canton, keeps leased cars out of your wealth automatically, and flags a financed car's loan as a deductible debt. One less line to puzzle over.