Those who have a long way to work can deduct more money from their tax from next year. For whom the new distance flat rate is worthwhile and how it is calculated.
Employees who have to commute to work receive tax benefits from the state. Commuter flat rate is called the benefit – and it will be even greater in the coming year. However, not all commuters benefit from the higher rates.
We explain exactly what changes in the distance flat rate, who actually benefits from it and what applies to employees who do not pay any wage or income tax.
What is the commuter allowance?
Commuter allowance is the unofficial name for the distance allowance that every taxpayer is entitled to for his easy way to the first place of work. It does not matter whether the journey to work is covered by car, on foot, on a bike, by train or on an e-scooter. Only flights don’t count. Previously, you received a flat rate of 30 cents per working day for every kilometer of the simple – and shortest – route. But that will change in 2021.
What changes in the commuter allowance?
From January 1, 2021, the commuter allowance will increase. “For the first 20 kilometers of the distance from the apartment to the first place of work, the familiar 30 cents remain,” explains Uwe Rauhöft, managing director of the Federal Association of Wage Tax Assistance Associations in Berlin.
Only from the 21st kilometer can 35 cents per kilometer be included in the income tax return. The commuter allowance can be claimed for one way, not for the outward and return journey together.
The new rates apply until December 31, 2023. After this date, 38 cents per kilometer can be applied in the income tax return from the 21st kilometer. This then applies until December 31, 2026.
Where do I enter the commuter allowance in the tax return?
The commuter allowance is part of the advertising expenses. You can specify this in Appendix N. Then enter the corresponding number of kilometers there. If you use a route that is longer than the shortest possible, but faster – for example because a road is closed or you are avoiding frequent traffic jams – enter this longer route. The tax office must recognize the detour.
The distance flat rate covers additional expenses, for example for parking tickets or car financing. However, if you have an accident on the way to work that incurs costs, you can bill this in addition to the commuter allowance. The prerequisite for this is that neither your employer nor the insurance company pay for these costs. Read here another 15 tips on what you can do everything from tax.
Who is the new commuter flat rate for?
“For example, if an employee is 35 kilometers away from work and visits it 210 times a year, advertising costs will be almost 160 euros higher in 2021 than in 2020,” Rauhöft calculates.
In 2024, they rose again by around 95 euros. For employees whose commute to work is up to 20 kilometers, there are no higher advertising costs.
What is the new mobility award?
Another new feature from 2021 is that employees who do not pay any wage or income tax will also benefit from the increased commuter allowance. “These employees can apply for a so-called mobility premium,” explains Rauhöft.
These employees receive the tax benefit from the higher commuter allowance that would result from a tax-paying employee as a bonus.
“If the employee does not have a tax effect on the 35-kilometer commute to work and 210 trips to work because his income is too low, he can receive a mobility premium of 154.35 euros,” Rauhöft calculates. The mobility allowance, like the commuter allowance, is requested from the responsible tax office.
How do I calculate the commuter allowance?
Let’s assume your commute to work is 35 kilometers long. The higher commuter allowance from 2021 would then make a difference of 157.50 euros for you:
- 2020: 210 trips x 35 km x 0.30 euros = 2,205 euros
- 2021: 210 trips x 20 km x 0.30 euros + 210 trips x 15 km x 0.35 euros = 2,362.50 euros
The next increase in 2024 brings you another 94.50 euros, which you can claim:
- 2024: 210 journeys x 20 km x 0.30 euros + 210 journeys x 15 km x 0.38 euros = 2,457.00 euros
How do I calculate the mobility premium?
For a commute of 35 kilometers, the following applies:
- 210 trips x 20 km x 0.30 euros = 1,260 euros (normal commuter flat rate, already exceeds employee flat rate of 1,000 euros, prerequisite for the mobility bonus from 21 kilometers)
- 210 trips x 15 km x 0.35 euros = 1,102.50 euros (increased commuter flat rate)
- 1,102.50 euros x 0.14 (14 percent; basic tax rate) = 154.35 euros premium